Energy transition pathways in Vietnam: an AIM/CGE model analysis of decarbonization strategies

Abstract Vietnam is facing severe challenges in its need to industrialize rapidly while simultaneously fulfilling its climate commitments, necessitating a comprehensive analysis of potential energy transition pathways. This study analyses four scenarios using the Asia-Pacific Integrated Modelling/Computable General Equilibrium (AIM/CGE) model to examine the primary energy structure, electricity capacity, and final energy consumption up to 2050. The Business as Usual (BaU) scenario projects primary energy at 7.0811 EJ by 2050 with fossil fuels accounting for 60.0443%, electricity capacity reaching 88.9101 GW and final energy consumption rising to 4.4014 EJ. This indicates continued reliance on fossil fuels. Meanwhile, the Accelerated Clean Transition (ACT) scenario achieves the most comprehensive transition, with primary energy declines to 5.8140 EJ (17.8941% less than baseline), the electricity capacity increases to 126.8920 GW, and final energy consumption drops to a 26.5679% reduction compared to the BaU scenario. By 2050, renewable energy is forecasted to contribute 39.2501% of primary energy. Additionally, solar and wind energy account for 37.1093% and 13.7230% of the electricity structure, respectively. The Compressed Transition Pathway (CTP) and Minimal Transition Pathway (MTP) scenarios illustrate higher transition costs due to shorter implementation timeframes, with primary energy achieving 5.1022 EJ and 5.7640 EJ. The industrial sector remains the most energy-intensive, accounting for 36.6949%–48.5244% of total final energy by 2050. The outcomes underscore that early policy intervention, accelerated investment in renewable energy, a systematic phase-out of fossil fuels, and strategic deployment of carbon capture and storage (CCS) technology are critical to ensure that Vietnam achieves its climate commitments yet maintains energy security and sustains economic growth.