Vietnam’s energy transition deal is a ‘black box’, partner warns

A Vietnam government partner suggested that even Hanoi is unaware of the details of the energy transition package

A government partner in a $15.5 billion deal to help Vietnam move away from coal has described the package as a “black box”. 

Details of the agreement to accelerateUS federal agency funds methane capture project India

 13 Mar 2023  CW Team

A federal US agency has approved grant funding for a feasibility study to develop a coal mine methane (CMM) recovery facility in Jharkhand's Jharia coalfield, the first of its kind in India. The US Trade and Development Agency (USTDA) approved grant funding for a feasibility study to support Prabha Energy (PEPL) efforts to develop a coal mine methane (CMM) recovery facility in the Jharia coalfield.

According to a press release from the USTDA, Advanced Resources International of Virginia has been chosen to conduct the study.

"USTDA is pleased to collaborate with PEPL on this project, which presents a tremendous opportunity to strengthen India's energy resilience and sustainability using innovative technology that US companies can readily provide," said Enoh T Ebong, Director of USTDA.

"This project will prevent methane, a harmful greenhouse gas, from being released directly into the atmosphere. This will benefit India and the rest of the world's climate "Ebong elaborated.

The USTDA-funded feasibility study, according to the press release, will develop recommendations for extracting, gathering, compressing, and processing CMM at the Jharia site while utilising innovative US technologies and solutions. The project has the dual benefit of preventing methane emissions and providing a cleaner fuel alternative to coal by capturing the CMM.

"PEPL is pleased to partner with USTDA and ARI on the potential capture of methane gas from the Jharia coal mine in India," said Prem Sawhney, CEO & Director of PEPL. "This project, the first of its kind in India, will increase India's domestic gas resources while also providing opportunities for US equipment and technology suppliers," Sawhney explained.

The study advances the goals of the federal agency's Global Partnership for Climate-Smart Infrastructure, which seeks to encourage the use of US technologies and services in overseas climate-smart infrastructure projects, as well as the Responsible Oil and Gas Pillar of the US-India Strategic Clean Energy Partnership. The project also supports the Biden Administration's pledge to reduce global methane emissions and limit global warming through the Global Methane Pledge.

 Vietnam’s energy transition remain unclear even to the southeast Asian nation, according to Sunita Dubey, Vietnam’s country lead for the Global Energy Alliance for People and Planet (Geapp), which supports the government’s transition plans.

“The terms and conditions for… the funding are not currently clear to the broader development community, including the [Vietnamese] government. We have been asking G7 [countries]. I believe even Vietnam has been asking G7,” Dubey told Climate Home in an interview, lamenting a lack of transparency over the financing arrangements offered by wealthy nations.

She added that the details should be revealed in an investment plan expected later this year.

In December 2022, Vietnam became the third country to agree a Just Energy Transition Partnership (JETP) with a group of wealthy countries and development banks to wean itself off coal, which currently generates most of its electricity.

Criticism over the lack of transparency of the deal follows similar concerns over the secrecy of energy transition agreements struck with South Africa and Indonesia.