Photo/Illutration The O Mon Thermal Power Plant in Can Tho, southern Vietnam (Provided by JICA)

A Vietnamese thermal power plant project funded with over 83.8 billion yen ($558 million) in Official Development Assistance significantly underperformed even as late as fiscal 2020 when aid was still flowing, the Board of Audit of Japan found.

The shortfall in electricity generation at the O Mon Thermal Power Plant and transmission network in Can Tho, southern Vietnam, was attributed to delays in the development of local gas fields, which meant the facility had to use heavy oil instead of gas to power the plant.

Japan provided 83.82 billion yen in ODA to Vietnam for the project between fiscal 2002 and 2020. The deficiency in project expectations was only discovered during screening by the watchdog body of the way Japan’s ODA is used in developing countries.

According to the Board of Audit and the Japan International Cooperation Agency (JICA), Mitsubishi Heavy Industries Ltd. and Sojitz Corp. were among Japanese companies involved in the construction of the plant operated by Vietnam Electricity Corp.

Construction of the No. 1 and No. 2 generators began in 2006 and 2012, respectively, with operations correspondingly starting in 2009 and 2015.

JICA based its ODA support on the assumption that gas from fields to be developed by a foreign consortium, including a subsidiary of Mitsui & Co., would fuel the plant. Until the gas became available, the plan specified that the facility would operate using heavy oil.

However, the Board of Audit discovered that development of the gas field remained unfinished as of May 2025, basically 16 years after the No. 1 generator was completed, and the plant continued to operate solely on heavy oil.

Although the site was designated as a key regional electricity source, the rising cost of heavy oil meant it could not run continuously and only operated during periods when electricity demand peaked.

Consequently, the amount of electricity transmitted fell far below the targets set by JICA and the Vietnamese side.

In 2024, the No. 1 generator achieved only 3.1 percent of its target, and the No. 2 reached only 4.4 percent. In 2021, when the COVID-19 pandemic was raging and demand was low, the plant generated no electricity at all.

The Board of Audit flagged the project while it reviewed 82 ODA programs across eight countries from fiscal 1995 to 2023.

It noted that the timing for the gas fields to provide a steady supply was very uncertain, “yet this was not sufficiently verified.”

The Board of Audit concluded that the project’s objectives “fell far short of what was needed.”

For its part, JICA said: “The construction of the power plant was also intended to stimulate gas field development. It contributed to the business expansion of Japanese companies, so there were certain achievements.”

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