Just Energy Transition Partnerships (JETPs) currently support four emerging economies – South Africa, Indonesia, Vietnam, and Senegal in achieving low-carbon economies. The goal of these partnerships is to help these countries transition away from coal while addressing the associated social and economic challenges.
Key Points:
* South Africa, the first JETP was announced at COP26, with a commitment of about $8.5 billion.
* Indonesia negotiated a $20 billion JETP agreement with the international Partners Group (IPG), including $10 billion from commercial investors.
* Vietnam received a $15.5 billion JETP agreement.
* Senegal was pledged for a $2.5 billion JETP agreement.
* The International Partners Group (IPG) includes Japan, the USA, Canada, Denmark, France, Germany, Italy, Norway, the EU and the UK.
What are JETPs?
Just Energy Transition Partnerships (JETPs) are multilateral platforms between developed and emerging economies designed to deliver climate finance that provide climate finance and support developing countries in their energy transition.
The Mechanism used are:
Substantial governmental support.
Dedicated funding streams to support transition programs and efforts, including vocational job training and creation.
Diversifying economic opportunities, and
Strong and divers coalitions.
Vietnam entered JETP cooperation with IPG in December 2022, decided to phase-out coal-fired power generation and committed for net-zero CO2 emissions in 2025.
The EU and the UK are fully committed to the JETP as joint co-leaders of the cooperation with Vietnam, as the country continues to increase its ambitions for tackling emissions, limit coal use and increase the share of renewable energy as set out with the recently revised National Energy Development Plan (PDP8).
Vietnam has halted the construction of new coal-fired power plants, and only a few nearly completed plants are still being finished.
Instead, Vietnam is investing in LNG infrastructure using natural gas as a bridging technology until renewable energy sources provide majority of electricity generation, as planned.
The latest flagship energy transition projects supported by IPG are a 500 KV transmission line and substations build across Binh Duong and Dong Nai provinces, an EVN NPT project financed by French Agence Française de Développement (AFD). This project will increase the national transmission network’s capacity to integrate renewable energy and deliver reliable electricity in key economic regions in southern Vietnam.
In addition, a MoU has been signed between EVN and AFD, providing long-term financing of USD 552 million for the construction of Vietnam’s first 1,200 MW pumped storage power plant in Ninh Thuan Province. This large-scale energy storage project will improve grid stability and enable the further integration of variable renewable energy sources into Vietnam’s energy mix. This pilot project also contributes to the development of regulatory, financial, and investment approaches, paving the way for related future partnerships.
This financial contribution of USD 616 million by France and the IPG to these two flagship energy transition projects marks an important step towards fulfilling the public financing commitments under the JETP.
