Other BriefingsInvesting in Vietnam’s Renewable Energy Sector: A Market Entry Guide for Foreign Investors
Vietnam’s rising electricity demand, expanding renewable energy targets, and position as a major export manufacturing hub are creating investment opportunities across solar, onshore and offshore wind, energy storage, grid infrastructure, and corporate renewable electricity. The scale of planned power-sector expansion is also increasing demand for project development, engineering, technology, financing, and supporting energy infrastructure.
Vietnam’s renewable energy market
Vietnam has developed one of Southeast Asia’s largest renewable energy markets following rapid investment in solar and wind generation. Solar and wind accounted for more than 25 percent of the country’s installed electricity capacity in 2024, establishing a substantial renewable generation base as industrial growth continues to increase electricity demand.
The next phase of expansion is considerably larger. Under the adjusted Power Development Plan VIII (PDP8), approved in April 2025, Vietnam targets total domestic power generation capacity of approximately 183.3 GW to 236.4 GW by 2030. Implementing the adjusted power plan is expected to require around USD 135–136 billion in power-sector investment through 2030.
Renewable energy represents a major component of this expansion. Vietnam targets approximately 46.5 GW to 73.4 GW of solar capacity by 2030, while onshore and nearshore wind capacity is expected to reach approximately 26.1 GW to 38 GW. The scale of these targets creates opportunities not only for project developers but also for investors and companies providing engineering, equipment, financing, grid infrastructure, and supporting technologies.
Energy storage will become increasingly important as variable renewable generation expands. The adjusted PDP8 targets between 10 GW and 16.3 GW of battery storage capacity by 2030, alongside between 2.4 GW and 6 GW of pumped-storage hydropower. These additions create a separate investment market in battery systems, integration technologies, engineering, and grid services.
Where foreign investors can participate in Vietnam’s renewable energy market
Utility-scale solar and wind
Solar and onshore wind remain major areas for renewable energy investment. At the upper end of the adjusted PDP8 targets, solar capacity could reach approximately 73.4 GW by 2030, while onshore and nearshore wind could reach approximately 38 GW.
The commercial environment has, however, changed from the earlier period of rapid renewable deployment supported by feed-in tariffs. New projects must be assessed against Vietnam’s current power development framework, electricity pricing and procurement arrangements, grid availability, and project approval requirements.
A strong solar or wind resource is therefore only one component of project viability. Investors also need to determine whether the proposed development is consistent with applicable electricity and provincial planning, whether sufficient grid capacity is available, how electricity will be sold, and whether the project can secure the approvals necessary to proceed.
Offshore wind
Offshore wind represents one of Vietnam’s largest longer-term renewable energy opportunities. World Bank technical mapping estimates Vietnam’s fixed and floating offshore wind potential at 599 GW, comprising approximately 261 GW of fixed-bottom potential and 338 GW of floating potential.
The adjusted PDP8 targets between 6 GW and 17 GW of offshore wind capacity during the 2030–2035 period. Commercial deployment at this scale would still represent only a fraction of the country’s estimated technical resource, leaving considerable potential for longer-term development.
The investment requirements differ substantially from established solar and onshore wind projects. Offshore developments require significant capital and involve marine surveys, sea-area access, transmission infrastructure, environmental assessment, specialized construction capabilities, and long development periods.
For international energy companies, infrastructure investors, turbine manufacturers, engineering groups, and offshore service providers, opportunities can therefore extend beyond project ownership into the infrastructure and services required to develop Vietnam’s offshore wind industry.
Grid infrastructure and energy storage
Vietnam’s renewable energy expansion cannot be separated from investment in its electricity network. The country’s earlier rapid solar expansion exposed transmission constraints in renewable-heavy areas, making grid availability an important commercial consideration for new generation projects.
The scale of planned solar and wind additions increases the requirement for transmission lines, substations, electricity storage, and grid-management technologies. For generation investors, the availability and timing of grid connections can therefore materially affect project development and commercial operation.
Battery energy storage is particularly significant. With Vietnam targeting between 10 GW and 16.3 GW of battery storage by 2030, opportunities are emerging for battery manufacturers, system integrators, engineering companies, technology providers, and investors supporting renewable integration and grid stability.
The opportunity is also increasingly connected to solar development. The adjusted PDP8 envisages battery storage accompanying centralized solar capacity, strengthening the commercial relationship between investment in new renewable generation and investment in storage infrastructure.
Renewable energy for industrial and export manufacturing
Vietnam’s position as a major manufacturing and export platform creates a renewable energy market extending beyond conventional utility-scale electricity generation.
Electronics, textiles, footwear, machinery, and other export-oriented industries operate within international supply chains where multinational companies are increasingly setting renewable electricity and emissions-reduction targets. Foreign-invested companies are particularly important to Vietnam’s export economy, accounting for around 70 percent of the country’s exports.
Continued manufacturing investment is simultaneously increasing electricity requirements within Vietnam’s major industrial regions. This creates commercial demand for renewable electricity procurement, rooftop solar, self-production and self-consumption systems, battery storage, and other energy solutions serving factories and industrial facilities.
For renewable energy investors, industrial consumers therefore represent an increasingly important source of demand alongside the national electricity system, particularly where manufacturers seek greater control over the source and carbon intensity of their electricity.
How Vietnam’s DPPA framework changes the investment opportunity
Vietnam’s Direct Power Purchase Agreement (DPPA) framework creates an additional commercial route connecting renewable energy generators with large electricity consumers.
Decree No. 57/2025/ND-CP established the mechanism for direct electricity trading between renewable energy generators and large electricity consumers. Decree No. 243/2026/ND-CP, effective from June 26, 2026, subsequently amended the DPPA framework together with provisions governing renewable and new energy development.
Depending on the applicable model, direct electricity trading can take place through a private connection or arrangements involving the national electricity grid. For renewable energy developers, this creates an additional route to industrial electricity demand, particularly from multinational manufacturers seeking renewable electricity for their operations and export supply chains.
For manufacturers, DPPA arrangements can provide a mechanism for aligning electricity procurement with corporate renewable energy and emissions-reduction targets. However, eligibility, connection arrangements, electricity market participation, and contractual structure must be assessed against the applicable framework before a project is structured.
Choosing the right renewable energy investment structure
There is no single market-entry structure for renewable energy investment in Vietnam. The appropriate route depends on whether the investor intends to develop electricity generation, supply renewable electricity to industrial consumers, manufacture equipment, or provide engineering and technical services.
|
Business activity |
Typical structure |
Key commercial and regulatory considerations |
|
Utility-scale solar or wind generation |
Foreign-invested project company |
Project approvals, power planning, electricity sales, land, environmental requirements, and grid connection |
|
Offshore wind |
Project company or joint investment structure |
Investment approval, marine surveys, sea-area requirements, transmission, project development rights, and financing |
|
DPPA renewable generation |
Project company |
Consumer eligibility, DPPA structure, grid or private-line model, and electricity market requirements |
|
Industrial renewable energy and rooftop solar |
Project company, industrial company, or permitted contractual model |
Self-consumption, surplus electricity, site requirements, and connection arrangements |
|
Renewable energy equipment manufacturing |
Foreign-invested enterprise |
Industrial location, investment incentives, environmental requirements, and supply chain |
|
EPC and technical services |
Foreign-invested enterprise or permitted contractual structure |
Construction requirements, technical capability, and project-specific licensing |
For power generation projects, establishing the investment vehicle is only one part of market entry. The underlying project must also satisfy the investment, land, environmental, construction, electricity, and grid requirements applicable to its technology and location.
The regulatory pathway can therefore differ substantially between a utility-scale wind farm, offshore wind development, rooftop solar installation serving a factory, and renewable energy equipment manufacturer.
This distinction is particularly important for foreign investors considering acquisitions or joint ventures. Existing project rights, land arrangements, grid access, development approvals, electricity sales arrangements, and outstanding regulatory obligations can materially affect whether an acquired renewable energy project can proceed and generate revenue.
Investment incentives for renewable energy projects
Vietnam provides investment incentives that can materially affect the economics of qualifying renewable energy projects. Qualifying clean and renewable energy projects can receive a preferential corporate income tax rate of 10 percent for 15 years, compared with the standard 20 percent rate, together with a four-year tax exemption and a 50 percent reduction in tax payable for the following nine years.
The actual incentive package depends on whether the project satisfies the applicable activity, location, and investment requirements. Projects may also qualify for import-duty exemptions on eligible imported goods used to create fixed assets and land-related incentives where the statutory requirements are satisfied.
The available treatment should therefore be assessed against the specific investment rather than assuming that every business operating within the renewable energy value chain receives the same incentives. Renewable electricity generation, equipment manufacturing, offshore wind, and supporting infrastructure can have different investment characteristics and incentive eligibility.
For capital-intensive renewable energy investments, preferential tax treatment can materially affect project returns over the investment period. Incentive eligibility should therefore be evaluated alongside the project’s investment structure, location, financing model, and regulatory pathway.
Contact Us About Renewable Energy Investment in Vietnam
Foreign investors evaluating renewable energy projects in Vietnam can contact Lok Kah Seng to discuss investment opportunities, market entry, project structuring, and the regulatory requirements for establishing and operating in the market.
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