The Asian Development Bank said Thursday it has approved a loan of US$309.89 million for a new power plant in southern Vietnam, because the demand for electricity is growing in the country.
The 750-megawatt O Mon IV plant is one of four being developed at the O Mon thermal power complex in Can Tho City. The plant, due for completion by June 2016, is projected to cost $793.5 million.
Germany's KfW Bankengruppe will contribute $370 million, with state-owned Electricity of Viet Nam and the government covering the rest, ADB said in a statement.
According to the Manila-based development lender, the combined cycle gas turbine project will save approximately 600,000 tons of carbon dioxide emissions a year compared to coal-based alternatives.
ADB said the growing demand for power has put a strain on existing generating capacity, resulting in power shortages and unstable supply during the dry season.
"Vietnam's power consumption has been growing 15 percent a year over the past decade, and will continue rising at a double-digit pace for the foreseeable future," said Anthony Jude, director of ADB's Energy Division for Southeast Asia. "Vietnam desperately needs more electricity, and the additional power supply will support economic and social development in the Mekong Delta."
The O Mon complex will have a generation capacity of 3,600 MW. Vietnam aims to more than triple its energy capacity from 18,500 MW in 2010 to 60,000 MW by 2020, according to ADB.