Energy Transition Update: 27.4 - 4.5.2026
Energy Transition Update: 27.4 - 4.5.2026
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Energy Transition Update: 27.4 - 4.5.2026 ---
Hanoi scales back petrol motorbike ban plan amid economic and policy concerns
Hanoi authorities are reconsidering their plan to ban petrol motorbikes in central areas, following concerns raised by businesses and foreign partners. The initial policy, issued in July 2025, aimed to restrict fossil-fuel motorbikes within Ring Road 1 from July 2026 to improve air quality. However, Japan’s government and major manufacturers, including Honda, warned that the ban could disrupt a US$4.6 billion market and lead to job losses. A revised proposal now suggests a more limited pilot of low-emission zones, applying only to a smaller area in Hoan Kiem district and restricted to weekend time slots. The adjustment reflects the difficulty of implementing large-scale transport restrictions in a motorbike-dependent economy, highlighting the need to balance environmental goals with economic stability and social impact.
Core technology seen as decisive factor in Vietnam’s electric motorbike race
Vietnam’s electric motorbike market is projected to expand rapidly, potentially reaching around US$3.7 billion this year, with long-term growth driven by urbanisation, environmental targets and policy support. Against this backdrop, the article argues that mastering core technologies, particularly batteries, motors and battery management systems, will be critical for firms seeking to compete in the transition away from petrol vehicles. However, adoption remains constrained by structural bottlenecks, including limited charging infrastructure, concerns over battery performance and user convenience. The emerging strategy among some domestic firms is to prioritise technological integration and product optimisation rather than relying solely on infrastructure expansion. This suggests that competitive advantage may hinge less on scale and more on technological control, potentially shaping Vietnam’s position in the regional electric vehicle value chain.
Structural barriers continue to slow Vietnam’s green transition
Vietnam’s green transition remains slower than expected despite ambitious Net Zero commitments, with key constraints including limited financial resources, shortages of skilled “green” human capital, and underdeveloped data infrastructure. Experts note that while policy frameworks are largely in place, implementation capacity and resource mobilisation remain insufficient. The challenge appears less about strategy design than execution. A persistent policy bias toward short-term GDP growth, combined with weak coordination and limited private-sector engagement, may be diluting momentum. This suggests that the transition gap reflects structural constraints rather than a lack of ambition, raising questions about whether current institutional and financial mechanisms are adequate to support large-scale green transformation.
Green growth: from imperative to a new growth engine
Vietnam’s push for green growth is no longer framed merely as a response to external pressure. It is increasingly understood as an internal necessity, especially as traditional drivers such as low-cost labour and fossil fuel-based production begin to lose momentum. At the same time, global trade rules are becoming more stringent. Carbon-related regulations, environmental and social governance requirements, and new border adjustment measures are raising the cost of maintaining carbon-intensive production. For an export-oriented economy like Vietnam, this creates a growing risk of losing access to key markets. Yet the transition also presents new opportunities. Renewable energy, sustainable finance, and low-carbon manufacturing could become important sources of growth in the coming decade. The period from 2026 to 2035 is often seen as a critical window for structural transformation. Still, progress may be uneven. Limited access to capital, gaps in institutional coordination, and dependence on foreign technology continue to constrain the pace of change.
For lower emissions from aviation
Aviation currently accounts for around 2-3 percent of global carbon dioxide emissions, with the majority coming from long-haul flights. Projections suggest that emissions from international aviation could increase sharply, potentially tripling by 2050 if current trends continue. Reducing emissions in this sector is particularly challenging. Unlike other industries, aviation has limited short-term technological alternatives to fossil fuels, and improvements in efficiency alone may not offset growing demand. This suggests that meaningful progress will likely require a combination of measures, including sustainable fuels, technological innovation, and demand management.
Hanoi to install automated cameras to identify compliant vehicles entering low-emission zones
Hanoi is preparing to pilot low-emission zones within Ring Road 1 from July 1 to the end of 2026. A key measure involves installing automated camera systems capable of recognising license plates and identifying vehicles that meet emission standards, with deployment focused on entry points to ensure continuous monitoring. The system is expected to support classification of vehicles by emission levels and enable enforcement of restrictions in the designated zones. At the same time, implementation may generate short-term challenges. Traffic congestion could emerge at the boundaries of restricted areas if infrastructure and traffic management are not adjusted accordingly.
This suggests that the effectiveness of the policy will depend not only on monitoring technology but also on the broader readiness of urban transport systems.
Rooftop solar power to ease pressure on electricity supply
Vietnam is accelerating the rollout of rooftop solar as part of broader efforts to manage rising electricity demand and reduce pressure on the national grid. Local authorities are being tasked with promoting self-consumption systems across public offices, businesses and households, alongside measures to improve energy efficiency and demand management. The approach reflects a shift toward decentralised energy solutions. Rooftop solar can help reduce peak load, improve system efficiency and limit the need for costly new power generation. However, its effectiveness may be constrained by intermittency and dependence on weather conditions, suggesting that wider deployment will likely need to be complemented by storage technologies and stronger system coordination.
ADB to support $50 billion cross-border power grid in Asia-Pacific
The Asian Development Bank plans to mobilise around $50 billion for a regional electricity transmission network under its Pan-Asia Power Grid Initiative, part of a broader $70 billion programme for energy and digital infrastructure through 2035. The initiative aims to connect national power systems, expand cross-border electricity trade and facilitate the integration of renewable energy across the region. The project reflects a shift toward regional energy integration rather than isolated national grids. By improving transmission links and enabling electricity flows across borders, it could reduce costs and enhance energy security. At the same time, implementation will likely depend on regulatory coordination and large-scale investment, suggesting that institutional alignment may be as important as physical infrastructure in determining outcomes.