Hanoi: Vietnam’s transition towards cleaner forms of energy has brought a greater risk of disputes distinctive to renewable energy projects, state media reported on Friday.
The Vietnam International Arbitration Centre (VIAC) has recorded the increased risk of disputes arising from the sophistication of renewable projects, possibly resulting in dispute across several business activities, Vietnam News reported.
In the cases of large projects, dispute not only had a large impact on the local community but also the entire energy sector as a whole and the country’s energy stability and sustainability, said the VIAC.
The dispute in the renewable industry during the 2013-2022 period amounted to a total arbitral awards of more than $300 million, with the average time required to settle a dispute of up to seven months, said Chau Viet Bac, deputy secretary-general of the VIAC.
Changes to state policy and financial incentives have continued and will continue to lead to significant dispute between foreign investors and state organisations, Xinhua news agency reported.
Such dispute must be resolved through Vietnamese courts or arbitration bodies with the exceptions of contractual agreements and international treaties of which the country is a signatory but received different provisions, said Vu Thi Chau Quynh, deputy head of the legal affairs department under the Ministry of Planning and Investment.
Given the nature of energy projects which often require large capital investment, prolonged implementation processes and involve multiple stakeholders, investors are faced with substantially higher risks, she added.
Vietnam’s pivot towards a clean economy is forecast to fuel environmentally-focused products and services, which could be worth $300 billion to its gross domestic product by 2050, up from only $6.7 billion in 2020, according to industry experts.
–IANS
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