The global ambitions for Net Zero have put a value on energy transition action and made it a significant imperative for businesses. It is important to acknowledge that achieving net zero objectives requires holistic actions.
With this global momentum, Viet Nam has made a stronger commitment to tackle climate change since COP26. The government is pursuing continuous reforms and investments that aim to transition its economy towards the net zero agenda, including signing the Just Energy Transition Partnership (JETP) and approving the long-awaited Power Development Plan VIII (PDP VIII) and PDP VIII Implementation Plan. However, the reality is that the nation cannot meet its net zero commitment without serious actions and fundamental change. The private sector can play a pivotal role in driving this transformation. Tangible and actionable moves from the private sector can mitigate risks, unlock growth and productivity for businesses, and help Viet Nam get back on track to meet its net zero targets.
Businesses in Viet Nam which actively embrace the energy transition can mitigate risks and capture significant opportunities.
The transition in the energy market creates material and increasing risks for energy users, including rising energy costs, exposure to volatile events, and others. Businesses who are active in the energy transition can be more resilient to relevant climate risks, and avoid the Risk of Irrelevance in a Clean Future Energy System.
There are also substantial opportunities for businesses as both energy suppliers and users in the energy transition journey. Early and proactive transitioners offer a first-mover advantage, aligning business activities with evolving consumer attitudes, new technologies, and emerging markets.
Although current changes in Viet Nam have been largely incremental, the widespread adoption of renewable and smart energy technologies, fuelled by the pace of innovation, may pave the way for businesses to embrace more radical transformation.
Implementation difficulty is the main challenge hindering businesses in adopting radical transformation models. When assessing these strategy models, it is important to consider the Viet Nam context at hand to execute effectively, including but not limited to:
Availability of advanced technologies to pursue operational efficiency initiatives
Feasibility of technological upgrades and conversion of existing technologies to operate more sustainably
A framework that makes energy transition doable, affordable and profitable.
Capabilities-Driven Strategy helps to align strategic aspirations in energy transition with the unique capabilities of each company. This helps companies to achieve sustainable success in energy transition by growing in a way that fits their capabilities system and value proposition.
There are multiple options for energy transition. By categorising them into distinct levels within the carbon management hierarchy, businesses can easily identify the suitable options.
A structured overview of options can facilitate coherent choices across business units. This overview should take into account different business units (if heterogeneous), including a high-level description of the strategic option, a description of likely impacts, and a time dimension to facilitate the development of a strategic story.
A just transition refers to achieving net zero targets while considering the social and economic impacts on individuals, workforces and communities.
The Vietnamese government commitment in Just Energy Transition Partnership (JETP) demands a Just Energy Transition approach from businesses, to balance the environmental impact with commercial feasibility and the impact to all stakeholders while transitioning towards net zero.
Implementing Transformational Changes can be challenging to companies in Viet Nam. Hence, we suggest a step-by-step approach to help you develop an energy transition strategy and suitable business models to succeed in a climate-resilient and sustainable future.
1.1. Assess energy and value chain footprint
1.2. Identify opportunity value
1.3. Assess value
2.1. Capability assessment and targets
2.2. Energy strategy
2.3. Transformation roadmap
3.1. Energy procurement
3.2. Operations and logistics
3.3. Partnership facilitation
3.4. Supply chain energy transition
PwC has deep expertise to support businesses in their energy transition journey to achieve business goals with sustainable impact.
for an energy company in Brazil
for an engineering and construction company
for a major steel producer in India
Full application process support for a large-scale project for energy storage in Italy
in energy transition for a global automobile company in Japan
for EV charging service solutions for a Japanese trading and investment company
on energy transition strategy
on energy transition & climate action
Pham Anh Duy
Senior Manager, Capital Projects and Infrastructure, PwC Vietnam
Tel: +84 918 484 843
