Vietnam needs 14 billion USD to develop EV charging stations

An EV charging station of VinFast (Source: VinFast)

This is expected to reduce greenhouse gas emissions, and create great tremendous opportunities for the electric vehicles (EV) market.

The transition to EVs is a huge effort toward Vietnam's net zero goal and environmental protection, and it will also boost the national economy, especially in reducing oil import costs and creating millions of jobs.

According to a report from the World Bank, for EVs to become mainstream, especially among first-time car buyers, the charging station system plays a key role. It is estimated that Vietnam needs 2.2 billion USD by 2030 to build a network of public charging stations, and this figure will increase to 13.9 billion USD by 2040, and 32.6 billion USD by 2050 to meet most of the population's EV demand.

With the rapid development of EV technology and the trend towards green transportation, the demand for this type of vehicles is expected to increase strongly in the near future. It is predicted that more than 2.8 million EVs will be consumed from 2024 to 2035, and another 3 million in the 2036 - 2050 period if the development of the charging station network is accelerated.

Major manufacturers such as VinFast have pioneered in this field, not only investing themselves but also implementing the franchise model that enables businesses and people to participate in developing the charing network. This model helps promote not only the use of EVs but also the sustainability of the EV industry in Vietnam.

Public-private partnership models are also evaluated as a key for luring investment in charging stations. Electricity companies, fuel distributors, and specialised charging service providers can also contribute to the scheme.

Insiders said to further promote the scheme, the Vietnamese Government needs to have favourable and clear policies that facilitate the engagement of the private sector. This can be achieved through financial and non-financial incentives and the formation of a clear roadmap for EV adoption with strict technical standards for charging infrastructure.

International studies have shown that subsidies for developing charging infrastructure are 5-6 times more effective than subsidies for purchasing EVs. This demonstrates that if the Government focuses on building charging stations, Vietnam can accelerate the transition to EVs while reducing the dependence on fossil fuel energy sources.

Assoc. Prof. Dr. Dam Hoang Phuc from Hanoi University of Science and Technology said a clear mechanism will attract investors, thereby driving the development of Vietnam's charging station network.

Meanwhile, Nguyen Thi Phuong Hien, Deputy Director of the Institute of Transport Strategy and Development, said strong policies on energy transition are now available, but there is still a shortage of support policies for charing infrastructure development. Given this, investing in charging stations is an essential step for the Government to effectively boost the transition to EVs and green transport./.