Report finds liquefied natural gas critical as Vietnam’s electricity demand expected to more than triple

Friday, January 9, 2026

Media Contact: Dara McBee | Director of External Affairs | 580-350-7248 | dara.mcbee@hamminstitute.org

A new study from the Hamm Institute for American Energy at Oklahoma State University, through its Trilateral Energy Security Committee (TESC), in partnership with Wood Mackenzie, projects Vietnam’s electricity demand to more than triple by 2050, and finds that LNG will be critical to keeping the lights on. 

The study outlines some key policy reforms needed to unlock investment in LNG-to-power infrastructure at scale.

The study, “Economic Evaluation of LNG Potential in Vietnam” (January 2026), projects that Vietnam’s electricity demand will increase from 330 terawatt-hours (TWh) in 2025 to 1,100 TWh by 2050, a 300% rise. This means the country will require a power system capable of delivering over three times its current electricity output, with the economy expected to grow at an average annual rate of 4.6% during this period.

“Vietnam’s power demand is rising fast, and reliability will matter as much as capacity,” said Dr. Ann Bluntzer Pullin, executive director of the Hamm Institute. “LNG can be a practical solution to add reliable power at scale and strengthen energy security. This study lays out some key policy and regulatory reforms that can unlock investment and make integrated LNG-to-power projects financeable.”

What the study finds

Vietnam’s growing power demand will strain domestic energy supply, even with significant renewable expansion and new domestic gas production expected in the 2030s. 

The analysis concludes that LNG imports will be necessary to bridge the gap between demand and domestic supply, particularly in regions with high industrial activity.

Key projections and takeaways include:

• LNG demand is projected to increase significantly, from 0.5 million tons per year in 2025 to 17 million tons per year by 2050, driven by both power and non-power sectors. Approximately 65% of this demand will be concentrated in southern Vietnam.
• Domestic gas production is expected to rise in the 2030s, supported by major discoveries in central Vietnam, though the timelines for these upstream developments are currently uncertain. However, overall supply will remain insufficient as demand grows across the power and industrial sectors.
• Gas-fired power generation is projected to increase from 33 terawatt-hours in 2025 to 200 TWh by 2050. Gas will help balance intermittent renewables and maintain grid stability as coal use declines.

Attracting investment

The paper emphasizes that the financial viability of LNG-to-power projects is critical. 

It identifies some key policy and regulatory areas that can help increase project bankability and make them more attractive to international investors:

• Minimum dispatch factor: Investors and lenders require assurance that plants will operate sufficiently to meet take-or-pay obligations in LNG sales and purchase agreements.
• Fuel-cost pass-through: Tariffs should include automatic mechanisms to reflect monthly LNG price changes without requiring repeated approvals.
• Power tariffs and currency treatment: Long-term contracts require predictable management of currency conversion and repayment risk throughout the tariff structure.

“Vietnam has a real opportunity to pair economic growth with lower emissions by getting the power mix right,” said Dr. James E. Payne, dean of the Spears School of Business at OSU and a Hamm Institute Fellow. “Our analysis shows domestic gas and renewables help, but they do not close the gap on their own. LNG imports can bridge that gap, and targeted reforms on dispatch, fuel-cost pass-through, and tariffs can make projects bankable and accelerate investment.”

LNG, reliability, and emissions

Vietnam currently relies heavily on coal for electricity. 

The study finds that LNG can support near-term emissions reductions by displacing coal and providing firm power to support renewables as wind, solar and storage capacity increase.

The analysis estimates lifecycle emissions for coal-fired power generation in Vietnam at 224-242 grams of carbon dioxide equivalent per megajoule compared with 102-146 gCO2e/MJ for U.S.-sourced LNG, depending on fuel characteristics and supply chain conditions. 

This indicates that LNG can significantly reduce emissions intensity compared to coal in the power sector.

The role of U.S. LNG

The study notes that the U.S. is expected to increase its share of global LNG supply by the mid-2030s, providing additional supply options for Asian buyers. 

Based on Wood Mackenzie’s trade flow analysis and high-level assumptions, the paper estimates that approximately 1.5 million tons of U.S. LNG could be supplied to Vietnam as early as 2035, but exact quantity will depend on contract signings and market conditions.