Businesses operating in Vietnam are currently dealing with power shortages that have negatively impacted operations and diminished consumer trust, prompting many companies to investigate ways of mitigating power outages and protecting their investment. Although different strategies work best for different organizations, following some simple steps will ensure businesses are prepared for any future challenges and have access to suitable power solutions that fit their specific requirements.
At a time of increased global gas demand, many emerging Asian economies are scrambling to add LNG capacity. But after conducting an in-depth project-by-project analysis of energy demand across seven of Asia’s fastest growing markets, an analysis revealed that many planned import terminal capacity and gas-fired power plant projects are unlikely to materialize due to global heating levels rising 67-74% with each additional gas addition beyond what the Paris Agreement allows.
Vietnam has announced plans to decrease its reliance on coal by quadrupling gas processing capacity by 2030 and making natural gas its primary source of electricity – but experts fear a power crisis may derail this plan.
In May, Vietnam unveiled an electricity roadmap involving 13 new LNG-fed power plants aiming to generate 22.4 gigawatts (GW) by 2030. According to state-owned utility EVN, this plan would see its energy mix shift away from coal-dominated sources to an array of fossil fuels with increased renewable components.
Recent surveys conducted by the European Chamber of Commerce in Vietnam indicated that half of businesses surveyed indicated power shortages had forced them to find alternatives or temporarily postpone investment plans, and half said lack of power had diminished customer service and compromised business performance.
Ha Dang Son, director of the Center for Energy and Green Growth Research (CEGR), suggests that Vietnam diversify its power sources to reduce reliance on fossil fuels. A successful plan requires investments in interregional and international power transmission grids as well as energy storage solutions.
As such, disagreements regarding energy pricing will likely continue for some time. Such disagreements have already contributed to the slow uptake of wind industry facilities that remain disconnected from the grid for years, leaving them without an outlet to sell their energy. He warns that disagreements could jeopardize sustainable LNG-supplied power sector development because plant developers will want secure long-term fuel contracts from EVN that offer reasonable pricing; this is particularly applicable when foreign investors such as US-based AES or Japan’s Marubeni invest in developing LNG plants within Vietnam.
