BAKU, Azerbaijan – At the Conference of Parties to the United Nations Framework Convention on Climate Change (COP29), environmental groups launched the SAVE Mekong Delta (Southeast Asian Voices on Energy Transition in the Mekong Delta) campaign, calling out developed countries to push developing countries like Vietnam into a dependence on fossil fuel imports.
A new briefing paper released alongside the campaign launch reveals developing countries dominate gas infrastructure development in Vietnam, with 71 percent of gas plant ownership and at least USD 2.3 billion of gas financing – or 82 percent of total gas financing since 2016 – coming from the United States, Japan, Europe, Canada, and South Korea. This expansion is particularly concentrated in the Mekong Delta, one of the largest and most fertile deltas in the world that also serves as an important food basket for Southeast Asia. By 2030, the Mekong Delta will host 64% of Vietnam’s total fossil gas capacity.
“While the world negotiates on climate finance at COP29, it’s clear as day how governments of the Global North use incentives, trade agreements, business deals, and financing to push developing countries like Vietnam to buy fossil gas. Countries like Japan and the US are using their weight in the region to create that market,” said Gerry Arances, Executive Director of the Center for Energy, Ecology, and Development, a Philippines-based think tank.
The IEEFA report cites that American exports of liquefied natural gas (LNG) have historically been linked to US foreign policy. LNG contracts between Vietnam and the US have been agreed after a 2019 visit to the White House by a delegation from Vietnam, which also came with a proposal to invest in the Son My 2 LNG-to-Power Project
Japan-led Asia Zero Emission Community (AZEC) initiative, aimed at carbon neutrality and zero-emission technologies with Southeast Asian countries and Australia, has faced criticism for promoting fossil fuel use. A recent report found that over one-third of AZEC agreements support fossil fuels or technologies that prolong the use of fossil fuels, like hydrogen and ammonia.
“Hydrogen and ammonia project financing is very costly because there is no large and long-term demand for it so far. Japan’s strategy is to create a deep supply chain of LNG, hydrogen, and ammonia in Southeast Asia to create massive demand, spread the costs, and position Japanese companies at a competitive advantage,” said Hiroki Osada, Campaigner from Friends of the Earth Japan, a Japanese environmental NGO.
In contrast, Southeast Asia now sees an eleven-fold increase in renewable energy projects, primarily solar and wind.
“Around 57 percent of renewables in Southeast Asia’s pipeline is being financed by domestic banks from Southeast Asia. Gas is much more expensive than renewables in Southeast Asia, so without gas-linked trade agreements, why would countries like Vietnam even choose gas? Choosing renewable energy over gas is a no-brainer,” said Arances.
“There is a transition financing mechanism called the Just Energy Transition Partnership (JETP) but it is very limited as it incentivizes Vietnam to pursue a coal-to-gas switch rather than renewables. There is limited involvement of civil society in the JETP process, which poses a problem on transparency and accountability over the energy transition,” said Regine Richter, Campaigner from Urgewald, a German environmental NGO.
Vietnamese climate leaders contributed to the shift from a coal-centric energy policy to an announcement by Vietnam’s prime minister made in COP26, pledging that Vietnam would achieve net zero by 2050, and along with it a commitment to phase out coal by 2040. The same environmentalists involved in this shift in energy policy have since been arrested by the government.
“In my opinion, Vietnam’s clean energy transition will not be possible while leading environmental activists like Bach languish in prison. I think that the work of Bach and other environmental activists in Vietnam Energy Alliance is so important for Vietnam just transition because Vietnam’s energy transition needs the participation of independent experts who can speak the truth who work for the benefits of the community, not for political motive,” said Tran Phuong Thao, wife of imprisoned Vietnamese environmental leader Dang Dinh Bach.
The SAVE Mekong Delta is a Southeast Asian-led campaign to stop the expansion of fossil gas infrastructure in the Mekong Delta. The campaign asserts the gas development in the Mekong Delta threatens the area’s ecosystem and puts at risk the health and livelihoods of Southeast Asians who depend on food from this region.