At the conference ESG – Motivations and Breakthroughs held by VIR and WBS Solution and System Co., Ltd., Nguyen Giang Nam, deputy general director of project financing at BCG Energy said, BCG Energy is one of Vietnam’s leading renewable energy developers, with a total renewable energy capacity in operation nearing 700MW.
The company plans to develop biomass power and waste-to-power generation, so capacity can reach 2GW.
We all know that there are many risks to the environment when developing fossil fuels. Coal, oil, and gas exploitation leads to soil erosion. Hydroelectricity also causes many changes to the surrounding environment, Nam said. Vietnam aims to achieve the net-zero goal by 2050. During this process, it is vital to develop renewable energy. To achieve net-zero emissions, renewable energy has to make up 70 per cent of the power mix.
To step up its ESG investments, at the end of 2023, BCG Energy acquired Tam Sinh Nghia Investment Development JSC, which is licensed to operate in the waste-to-power sector. Tam Sinh Nghia runs waste-to-power plants in Ho Chi Minh City, Long An and Kien Giang provinces.
In August 2023, Bamboo Capital Group, the parent company of BCG Energy, signed a partnership deal with STACS, an ESG fintech firm headquartered in Singapore. The aim is to improve the transparency of emissions for the group and its member companies, thereby building reputations with local and foreign investors.
Through this partnership, we have attracted about $60 million for foreign investment funds as well as gaining the trust of investors and partners in Vietnam. We have reaped several benefits from the ESG adoption, Nam said.
However, he also pointed out the existing problems. When working with foreign organisations, they pay special attention to ESG. However, there is a shortage of clear criteria and scoring practices.
He suggested the local departments of Planning and Investment integrate ESG standards in approving investment projects. Meanwhile, banks are incorporating ESG standards to review loan applications. Specific figures and criteria are needed for businesses to comply with and implement ESG practices, he said.
Another problem is how to access capital. ESG investing requires a huge sum of investment, so businesses should receive support from agencies such as the Ministry of Planning and Investment and the Ministry of Natural Resources and Environment. In fact, green investments often incur large costs and businesses might fail to achieve profits calculated before investing, which may affect investment efficiency. Therefore, when businesses adopt clean green technology and higher environmental standards, they expect to receive more support such as land and tax incentives, he added.
The journey to the net-zero goal requires the participation of all relevant stakeholders. Hopefully, state agencies will accompany businesses during this transformation process. Once the market has been shaped, businesses are willing to accept the game related to the environment, Nam added.
