Vietnam, 15 January 2021 – UOB Vietnam has provided its first two green loan facilities under the UOB Smart City Sustainable Finance Framework1 to two local companies, ATAD and Phan Vu Investment (PVI). Both companies will use the loan proceeds to build and to operate their own solar photovoltaic (PV) systems, each with a capacity of about 8,000 kilowatt-peak, on their factory rooftops.
The green loans provided by UOB Vietnam will help these companies make the change from using traditional sources of electricity to renewable energy, enabling them to save on their electricity bills over the long term. The companies will also contribute to the Vietnamese government’s environmental protection efforts to have at least 21 per cent of the country's electricity consumption to be powered by renewable energy by 2030.
The rooftop solar PV systems will generate an aggregate of 18,600 megawatt-hours of electricity per annum. This translates to 8,420 metric tonnes of carbon dioxide reduction or 1,800 cars taken off the road yearly or 140,000 tree seedlings being grown for 10 years2. Beyond their own consumption, ATAD and PVI will be able to sell any excess electricity generated to Vietnam Electricity (EVN)’s grid and they can use the revenue to offset their electricity costs.
Mr Harry Loh, Chief Executive Officer of UOB Vietnam, said, “The transition from non-renewable to renewable energy requires collaborative efforts from all segments of society. UOB is one of the pioneers in providing green loans to businesses in Vietnam as we facilitate the shift towards the use of sustainable energy. Following our green loans to ATAD and PVI, we aim to accelerate our provision of green and sustainability-linked financing to help more businesses advance responsibly as we forge a sustainable future together.”
ATAD and PVI are UOB Vietnam’s longstanding clients. They approached UOB Vietnam for green loans as they recognised UOB’s track record in financing solar PV projects in the region through the U-Solar programme3. Further, under the UOB Smart City Sustainable Finance Framework, the companies were able to qualify for the green loan facilities without having to develop their own financing framework which can take time and resources.
Mr Phan Khac Long, founder and Chairman of PVI, said, “PVI has been banking with UOB Vietnam for more than ten years. Over the last decade, the Bank has supported us on trade finance, cash management, capital expenditure requirements and most recently green financing for our solar power project. The loan has helped us to realise our aspiration of becoming a greener business.”
Mr Huynh Ngoc Dong, Chairman of ATAD, said, “UOB is a leading green financing provider in the region and UOB Vietnam is one of the first few foreign banks to provide green financing locally. As such, ATAD has full confidence in choosing UOB Vietnam for our important project investment.”
Since 2011, Vietnam has seen a continued increase of 10 to 12 per cent per year in electricity consumption as it drives economic development. The government is encouraging private companies to participate in the growth of green energy through its many policies, including special tariffs for solar power production and usage.
1 Please see UOB news release: “UOB launches its Smart City Sustainable Finance Framework, the first by a bank in Asia to help more companies advance responsibly”, 24 November 2020.
2 Calculated based on the United States Environmental Protection Agency (US EPA).
3 The U-Solar programme is the first solar industry ecosystem in Asia to power the development and adoption of renewable energy across Southeast Asia. To promote the adoption of solar power by the end-users which include companies and consumers, U-Solar offers a one-stop shop for them to plug easily into the services offered by UOB’s partners across the region. Please visit https://www.uobgroup.com/u-solar/index.page for more information.