Viet Nam

Despite critically lacking ambition in its climate targets, momentum is building in Viet Nam for deeper renewable energy integration and a coal phase-out, aligning with its commitment to reach net zero emissions by 2050. The revised 2025 Power Development Plan 8 (2025 PDP8) and the 2024 Electricity Law signal stronger long-term alignment with the clean energy transition, particularly through ambitious targets for solar and offshore wind.

Unfortunately, these initiatives lack a clear implementation strategy and are further undermined by the persistence of coal in electricity generation well beyond 2030. At the same time, the government’s strategy builds on expanding fossil gas, particularly LNG imports, which it wrongly claims as a so-called “transition fuel.” This reliance not only risks locking in high emissions and stranded assets, but also exacerbates energy security vulnerabilities, as both coal and fossil gas imports are projected to rise in the coming decade.

The emphasis on sustaining rapid economic growth has reinforced a “dual strategy” in Viet Nam’s energy planning: prioritising renewables in the long term will reduce overall emissions in 2050 from the power sector compared to the 2023 PDP8, but retaining fossil fuels in the medium term is locking in higher emissions this decade. The updated PDP8 also revives nuclear power as a long-term option. The Climate Action Tracker continues to rate Viet Nam’s overall climate targets and action as “Critically insufficient.”

Although Viet Nam has recently introduced several sectoral policies, emissions under current policies are expected to be 26 to 32% higher in 2030 than in 2024. This is primarily because most of the newly-announced or adopted policies, apart from the updated Power Development Plan 8 (PDP8), remain at a framework level or lack detailed regulations on implementation. Similarly, Viet Nam’s 2022 NDC is not sufficiently ambitious, and its unconditional target allows emissions to rise well above the levels implied by current policies.

The 2025 PDP8 is underpinned by an assumption of 10% annual GDP growth between 2026–2030, a major increase from the current GDP growth rate of 5% per annum. This elevated growth trajectory drives much higher projected electricity demand which, in turn, has influenced policy choices. While the increased demand is planned to be supported by a massive scale-up of solar, wind, and grid infrastructure, the transition pathway also requires managing the peak and then accelerating the reduction of existing fossil assets. It has also been used to rationalise maintaining coal capacity through the 2030s, expanding fossil gas and liquified natural gas (LNG) infrastructure, and reviving nuclear power as a means to ensure baseload supply, raising additional concerns over cost overruns, safety risks, and unresolved nuclear waste management issues.

Internationally, the Just Energy Transition Partnership (JETP), signed in 2022, represents a critical avenue for accelerating the low-carbon transition in Viet Nam. With a total of USD 15.5 billion pledged for 2026–2028, the pipeline now includes 24 projects with USD 7 billion already mobilised. The progress is tangible, particularly in hydropower deployment and transmission upgrades. The integration of JETP goals into PDP8 and the Electricity Law also provides a stronger institutional framework. Yet implementation remains slow in terms of disbursement of funds and loans, and concerns persist over whether the “just” element of the transition is being meaningfully upheld, particularly in terms of inclusivity and social safeguards. The United States, an original International Partner Group member, has since withdrawn from JETP, narrowing the financing pool and complicating delivery, even as other partners move to backfill and several grid and hydropower projects advance.

Viet Nam launched its first pilot emissions trading scheme (ETS) in June 2025, initially covering the power, cement, and steel sectors—together responsible for nearly half of national CO₂ emissions. This marks an important institutional step, supported by new emissions reporting requirements, with a national registry under development. However, the scheme is based on intensity benchmarks rather than absolute caps and that risks the increase of emissions. This scheme allows up to 30% of compliance through carbon credits, both domestic and international, and grants most allowances for free, which brings into question the effectiveness of the emissions trading scheme.

Viet Nam has laid important policy and institutional foundations for its low-carbon transition for non-power sectors, which is visible in transport (electrification roadmaps), buildings (new efficiency standards), agriculture (methane action plan and Low-Emission Crop Production Plan) and waste (circular economy action plan). However, implementation remains at an early stage and as a result emissions under current policy projections remain high.

Overall, the credibility of Viet Nam’s climate commitments will hinge on accelerating coal retirement, avoiding a fossil gas lock-in, and addressing persistent governance and implementation gaps. Without stronger, economy-wide policies and decisive action this decade, the country risks missing the opportunity to align its development pathway with the 1.5°C limit.

Viet Nam’s emissions are set to keep rising until 2030, contrary to what is needed to achieve the 1.5°C temperature goal. To reverse this trend, Viet Nam could:

• Reduce dependence on fossil fuels in near term: While the revised PDP8 commits to a full coal phase-out by 2050, its near-term reliance on more than 30 GW of coal-fired capacity in 2030 shows that coal will continue to lock in carbon emissions for another decade, with an increasing reliance on imports and retrofitting plans that remain uncertain.
• Avoid relying on fossil gas as a “transition fuel” and prevent potential emissions lock-in. Instead focus on no new LNG contract or gas-fired power plant with increasing energy security, affordability, and profit from the multiple co-benefits that would come with the phase-out of fossil fuels and phase-in of renewable energy.
• More emphasis on industrial decarbonisation: With rapid GDP growth driving energy demand, intensity-based compliance can permit absolute emissions to rise even as firms “comply.” Establish sectoral roadmaps for steel, cement, chemicals, and textiles with binding and absolute reduction.
• Setting a clear and ambitious 2035 target and alongside also update the 2030 target by implementing a national, economy-wide goal. The target should clearly differentiate between unconditional commitments, which Viet Nam plans to meet using domestic resources, and conditional components that rely on international support.

Despite these drawbacks, the latest developments include some positive steps:

• The 2025 update of PDP8 strengthens coal phase-out commitments, scales up solar and offshore wind, and sets a long-term renewable capacity targets of 65–70% by 2050.
• The new Electricity Law (2024) enables a comprehensive electricity market reform, modernising planning, licensing, and grid regulation, creating clearer frameworks for renewable energy and market competition.
• The JETP has mobilised USD 7 billion in financing out of a total commitment of USD 15.5 billion in pledged support by donors and established a platform for renewable expansion, with early progress on project pipelines and grid financing.
• The policy push beyond power sector is progressing, such as the methane reduction plan in agriculture, green transport roadmap (electrification of buses, taxis, and EV incentives), and stronger building-sector efficiency standards.

The CAT ratings compare country’s targets and policies to (1) its fair share contribution to climate change mitigation considering a range of equity principles including responsibility, capability and equality, and (2) what is technically and economically feasible using modelled domestic pathways which are based on global least-cost climate change mitigation.

Comparing a country’s fair share ranges and modelled domestic pathways provides insights into which governments should provide climate finance and which should receive it. Developed countries with large responsibility for historical emissions and high per-capita emissions, must not only implement ambitious climate action domestically but must also support climate action in developing countries with lower historical responsibility, capability, and lower per-capita emissions.

The CAT rates Viet Nam’s climate targets and policies as "Critically insufficient." The "Critically insufficient" rating indicates that Viet Nam’s climate policies and commitments are not at all consistent with the Paris Agreement’s 1.5°C temperature limit. Viet Nam’s unconditional NDC and policies and action are both rated as critically insufficient when compared to its fair share.

With the update of the eighth Power Development Plan (2025 PDP8), overall emissions under current policies are lower compared to our last update by around 58 MtCO₂e in 2030, but it continues to be "Critically insufficient."

Viet Nam’s conditional NDC is rated as "Critically insufficient" compared to modelled domestic pathways. As a country with lower responsibility, capability, and per-capita emissions, Viet Nam should receive international support to set an ambitious conditional NDC target beyond its national fair share and implement the policies necessary to achieve it.

The CAT rates Viet Nam’s climate policies and action as “Critically insufficient” when compared to its fair share contribution. Under Viet Nam’s current policies and actions, emissions will continue to rise to around 686–722 MtCO₂e (excluding LULUCF) in 2030 – implying a warming of above 4°C. For a fair contribution to 1.5°C, emissions would need to fall to just below 350 MtCO₂e in 2030.

In May 2025, the Viet Nam government adopted the revised version of the Power Development Plan 8 (2025 PDP8), strengthening the coal phase-out and scaling up solar and offshore wind. However, the plan’s increased reliance on nuclear and LNG raises concerns.

Viet Nam’s new Electricity Law (2024), effective February 2025, replaces the 2004 framework with a comprehensive overhaul covering planning, licensing, pricing, market competition, and grid operations. Its success will depend on timely implementation of regulations, particularly for renewable incentives, project approval, and pricing mechanisms.

Coal usage for power generation remains a concern for Viet Nam, although it has shown a notable recent decline in the pipeline, largely due to insufficient project financing. The PDP8 aims to eliminate coal capacity by 2050, though coal will persist in the energy mix throughout this decade, contributing around 16% of installed capacity by 2030, an improvement on the 2023 PDP8 figure of 20%.

The adoption of the PDP8 confirms the scale up of fossil gas power generation, jeopardising renewable energy rollout in Viet Nam. Fossil gas-based power generation capacity is planned to be 16–18% in 2030, combining both domestic gas and LNG to power. To support this expansion, Viet Nam is planning to increase domestic production of fossil gas as well as imports, further increasing the country's vulnerability to energy security threats in a complex geopolitical landscape.

The plan proposes a share of wind and solar capacity of 40–47% by 2030.

The full policies and action analysis can be found here .

We rate Viet Nam’s 2030 conditional target compared to modelled domestic pathway as "Critically insufficient." Viet Nam’s conditional target equates to 629 MtCO₂e by 2030 (excluding LULUCF).

The “Critically insufficient” rating indicates that Viet Nam’s conditional target in 2030 reflect minimal to no action and is not at all consistent with modelled domestic pathways limiting warming to 1.5°C. If all countries were to follow Viet Nam’s approach, warming would exceed 4°C.

We rate Viet Nam’s unconditional target as “Critically insufficient” when compared to its fair share emissions allocation. Viet Nam’s unconditional target equates to 878 MtCO₂e by 2030 (excluding LULUCF).

This rating indicates that Viet Nam’s unconditional target in 2030 reflects minimal to no action and is not at all consistent with its fair share of the global mitigation effort to limit warming to 1.5°C. If all countries were to follow same approach, warming would exceed 4°C.

In 2016, Viet Nam had a net carbon sink capacity of 39 MtCO₂e. In its National Climate Change Strategy to 2050, Viet Nam has established a target for its land use and forestry sector with the aim of reducing 70% of remaining emissions, thereby increasing the carbon absorption rate by 20% and achieving a total sink capacity of 95 MtCO₂e by 2030. It aims to maintain national forest coverage of 43%, by improving forest quality and sustainable forest management techniques, and is critical to Viet Nam achieving net zero.

During the COP26 World Leaders’ Summit in 2021, Viet Nam announced a target to achieve net zero by 2050. This target covers three main GHG emissions – CO₂, CH₄ and N₂0, covering 98% of total emissions. In July 2022, Viet Nam reiterated its commitment to reach net zero in the decision approving its National Climate Change Strategy, aimed at guiding its planning to achieve net zero by 2050, and continued to strengthen measures to achieve the target in the recent 2025 PDP8. Viet Nam’s net zero target is conditional on international financial support. The CAT rates Viet Nam’s target as "Average."

The full net zero target analysis can be found here.