Vietnamese biopower producer Hau Giang Power Plant Joint Stock Company and Malaysia's CHE Group have signed a memorandum of understanding to build 20 biomass-fired power plants across southeast Vietnam.
The plants, each to generate 10MW of renewable energy, will use rice husk as feedstock. They will be located in six provinces: Dong Phap, Hau Giant, An Giang, Can Tho, Kiew Giang and Soe Trang.
CHE won the RM1.97 billion (€450 million) contract, which will see it design, engineer and commission the 20 rice husk plants. It was awarded the contract over other interested bidders from China and Singapore. The contract also involves the supply of related equipment for power generation at all plants.
Chong Che Chek, business director of CHE, says: 'The plants will be installed in four phases over five years with the engineering work of the first plant to start by year-end. This is the first of its kind power plant to be built in Vietnam and one of its unique features is the ability to produce non-hazardous high quality ashes.'
These ashes have the potential to be converted into cement substitute and silica fume for the semi-conductor industries.
According to the CHE's MD Chang Khong Keong, rice husks are readily available in Vietnam but many investors are not keen to invest in such biomass plants due to the low Feed-in Tariff compared to countries such as Malaysia, Cambodia, Thailand and the Philippines.
As a result of this, he says, the rice husks are being disposed of through environmentally harmful manners, such as open burning. 'The Vietnamese government is now providing incentives by improving the feed tariff to encourage investors to seriously consider biomass power generation projects,' he remarks.
In addition to Vietnam, the company is also looking to expand into Cambodia and Myanmar as both countries offer good prospects in the renewable energy sector. It has also received interest for rice husk-based plants in the Philippines and Indonesia.