Vietnam Clears First Offshore Wind Auction, Awarding 4GW Off Binh Thuan

HANOI — After four years of redrafted decrees and a regulatory limbo that scared off two foreign developers, Vietnam awarded its first competitive offshore wind concession on Tuesday, handing 4 gigawatts of seabed off Binh Thuan province to a consortium of Denmark's Orsted-aligned developer Nordvind and the Hanoi-listed PetroVietnam Power unit PV Wind.

The award, confirmed by the Ministry of Industry and Trade after a sealed-bid round, sets a strike price of 8.7 US cents per kilowatt-hour over a 20-year contract — below the 9.5-cent ceiling officials had quietly circulated, and roughly a third under the feed-in tariffs that powered the country's onshore solar boom of 2019.

For an industry that has watched Vietnam announce a 6GW offshore target for 2030 and then build none of it, the result is the first hard evidence that the pipeline is more than a slide in a planning document.

What the award covers

The Binh Thuan zone sits about 18 kilometres off the south-central coast in water 25 to 40 metres deep, shallow enough for fixed-bottom monopiles rather than the costlier floating platforms that push up budgets off Japan and South Korea. Nordvind's filing puts capital expenditure at roughly $9.4 billion, with first power targeted for the fourth quarter of 2029 and full commissioning a year later.

Under the terms, PV Wind holds 51 percent — preserving the majority-domestic ownership that Hanoi has insisted on for any project touching national waters — while Nordvind takes 49 percent and the engineering lead. Vietnam's state grid operator, EVN, has committed to a 500-kilovolt connection point at Vinh Tan, though developers privately concede that the substation upgrade is itself a two-year build.

A second 1.2GW block off Ba Ria-Vung Tau drew only one compliant bid and was held back for a re-tender in the third quarter, the ministry said.

Why the price matters

The 8.7-cent clearing price is the number the rest of the region will study. It lands above the sub-5-cent offshore tariffs seen in mature European auctions but well inside what Southeast Asian utilities expected for a first-of-its-kind project in a market with no domestic turbine supply chain and an untested permitting regime.

A clearing price under nine cents on the very first auction tells you the developers believe the permitting risk is finally falling, not rising. That is the signal capital was waiting for, said Le Thi Mai Anh, head of Asia power research at the consultancy Mekong Grid Partners.

Mekong Grid estimates the project will displace about 7.2 million tonnes of carbon dioxide a year once at full output, equivalent to retiring a mid-sized coal unit — though Vietnam is still building coal capacity in parallel, a contradiction critics inside the National Assembly have begun to raise more loudly.

The obstacles that remain

Financing is the next test. Nordvind wants to reach a final investment decision by mid-2027, but that requires a bankable power-purchase agreement that international lenders can accept — and Vietnam's standard PPA has historically lacked the take-or-pay guarantees and clear curtailment compensation that project-finance banks demand. Negotiations on those clauses are expected to run for months.

There is also the seabed-survey backlog. Only two vessels in the region are certified for the geotechnical work the project needs, and both are booked into 2027 on Taiwanese contracts. Industry figures say the survey bottleneck, not the turbines, is the likeliest cause of slippage.

Still, for a sector that spent half a decade waiting on Decree 80 and its successors, an actual award with an actual price changes the conversation. The question in Hanoi is no longer whether offshore wind will happen, but whether the grid can catch up to it.