The new Vietnam Power Report from BMI forecasts that the country will account for 1.16% of Asia Pacific regional power generation by 2012, with an increasing generation surplus that provides a theoretical export capability. BMI’s Asia Pacific power generation estimate for 2007 is 6,865 terawatt hours (twh), representing an increase of 9.6% over the previous year. We are forecasting an increase in regional generation to 9,370twh by 2012, representing a rise of 36.5%. Asia Pacific thermal power generation in 2007 is estimated by BMI at 5,431twh, accounting for 79.1% of the total electricity supplied in the region.

Our forecast for 2012 is 7,104twh, implying 46.6% growth that reduces the market share of thermal generation to 75.8% – thanks partly to environmental concerns that should be promoting renewables, hydro-electricity and nuclear generation. Vietnam’s thermal generation in 2007 was 33.7twh, or 0.62% of the regional total. By 2012, the country is expected to account for 0.94% of thermal generation. For Vietnam, oil is the dominant fuel, accounting for around 50% of primary energy demand (PED), followed by hydro-power at 20%, coal at 18% and gas with a 12% share of PED. Regional energy demand is forecast to reach 4,830mn tonnes of oil equivalent (toe) by 2012, representing 37.3% growth over the period.

Vietnam’s 2007 market share of 0.45% is set to rise to 0.57% by 2012. Vietnam’s 25.6twh of hydro-electric demand in 2007 is forecast to reach 37.6twh by 2012, with its share of the Asia Pacific hydro market falling from 3.16% to 2.58% over the period. Vietnam is ranked third ahead of Pakistan in BMI’s updated Power Business Environment rating, thanks largely to the growth potential of power consumption and energy demand, plus healthy scores in several other categories. The country is at little risk from Pakistan below it, and probably doesn’t have the potential to catch India above it. BMI is forecasting Vietnamese real GDP growth averaging 8.03% per annum between 2007 and 2012, with the 2008 forecast being 7.00%.

Population is expected to expand from 86.6mn to 92.7mn over the period, with GDP per capita and electricity consumption per capita forecast to increase significantly (by 130% and 26% respectively). The country’s power consumption is expected to increase from an estimated 53twh in 2007 to 72twh by the end of the forecast period, assuming 11.5% annual growth in generating capacity. Between 2007 and 2018, we are forecasting an increase in Vietnamese electricity generation of 156.9%, which is top of the range for the Asia Pacific region. This equates to 33.8% in the 2013-2018 period, down from 74.6% in 2007-2012. PED growth is set to decrease from 30.7% in 2007-2012 to 29.9%, representing 79.1% for the entire forecast period. Hydro generation is expected to rise by 47% between 2007 and 2018, with thermal power generation forecast to increase by 98% over the same period. More detail of the long-term BMI power forecasts can be found in the appendix of this report.