Share today: What is the development status of Vietnam's electricity market?

Vietnam's power and energy industry, a major strategic industry related to the livelihood of Vietnamese people, has not only received attention in Vietnam, but also received widespread attention in the international community.

In recent years, Vietnam's power development plan has achieved remarkable results in the installed capacity of new energy generation and the use of new technologies to promote the construction of smart grids.

Power generation equipment installed status

Based on 2020, Vietnam's total installed power generation capacity is 69GW, an increase of 13GW from 2019. In the total installed capacity, coal and hydropower installations accounted for 21GW, natural gas and oil about 9GW, and new energy power generation equipment other than hydropower accounted for 17GW.

Judging from the newly installed power capacity in the latest year, as well as the proportion of new energy power generation equipment, the Vietnamese government can really feel the importance of power projects.

At present, the rapid development of Vietnam's power equipment market, cable and voltmeter and other related equipment imports, compared with 2016 increased by 20% and 23%, power circuit breaker switches also have a 10% growth rate, you can judge that the demand for the entire power industry is increasing rapidly.

In 2007, the Vietnamese government formulated the National Energy Development Plan for Vietnam from 2020 to 2050 (Decision No.185/QD-Tg of December 27,2007). Approving Vietnam's National Energy Development Strategy Up to 2020 with 2050 Vision) and thus establishing the basis for Vietnam's energy development policy.

Through the National Energy Development Plan of Vietnam for 2020-2050, energy diversification and energy-saving technologies have been introduced to promote sustainable energy development.

The Vietnam National Energy Development Plan for 2020 to 2050 sets four goals:

1. Expand energy supplies such as coal and oil

2. Restructuring of energy market structure

3. Establish a modern intelligent power network

4, improve the power efficiency of areas outside the city

Subsequently, the 7th Electricity Development Plan (Revised), revised in 2016, emphasized the expansion of electricity penetration, expansion of the distribution network and improvement of energy efficiency, and focused on optimizing the power system while vigorously expanding the sources of power generation. In particular, in order to provide electricity in local and mountain areas, the target has been specifically specified, and it is planned to increase energy efficiency by more than 10%.

The main focus of Vietnam's power development plan is the diversification of energy sources and the efficiency of power industry development. Based on 2020, from the point of view of the current installed power capacity, energy diversification has reached the predetermined goal to a certain extent.

In particular, the revised 7th Power Development Plan increased the capacity of new energy generation equipment to 21 percent by 2030, but has actually exceeded this plan so far. In the eighth electric power development Plan, the target for the proportion of power generation equipment has also been partially revised.

According to the IEEFA (Institute of Energy Economics and Financial Analysis), Vietnam is the country with the highest potential in the development of the energy and power industry in Southeast Asia, and the new installed capacity will reach more than double the current installed capacity.

To sum up, Vietnam shows great potential in terms of infrastructure expansion and energy diversification.

Before discussing the transmission grid and smart grid projects in Vietnam, we first need to understand the major players in the Vietnamese electricity market. Vietnam's Energy industry is governed by the General Directorate of Energy (GDE), which is part of the Ministry of Industry and Trade.

The General Directorate of Energy (GDE) has the following responsibilities:

1. Formulate policies on electricity and energy;

(2) Approval of local and regional power and energy development plans

3. BOT (Built, Operate, manage and Transfer contract power projects. There are also various operations within the Energy Board, and all power supply operations are under the jurisdiction of the Grid and Rural Electric Department.

Vietnam Electricity (EVN) is an enterprise responsible for the generation, transmission, distribution and sales of electricity throughout Vietnam, and plays an exclusive (monopoly) role in many aspects of the electricity industry.

The Power company of Vietnam currently has several subsidiaries in the form of holding companies, These include GENCOS, National Power Transmission Corp. (NPT), distribution companies (Hanoi Power Generation Company, South Power Generation Company, Central Power Generation Company, North Power Generation Company, Ho Chi Minh Power Generation Company), Central Power Stations and power exchanges.

For a long time, Vietnam Electricity (EVN) also had a monopoly in the power generation business, but after changes to the electricity law, private companies can also participate in the power generation and distribution related business.

Petro Vietnam is the state-owned oil company of Vietnam, which is involved in the exploration and development of oil and coal. Petrovietnam also has subsidiaries including Vietnam PV-POWER, Vietnam Gas (PV-GAS), and Vietnam Petroleum (PV-Oil).

In the past, many people believed that Vietnam's power distribution infrastructure was exceeding its needs. But the short-term surge in new energy generation has led to the problem of overloading Vietnam's power grid.

For photovoltaic power generation equipment, taking into account the amount of sunshine conditions and other reasons, there are more cases installed in the mountainous area, which leads to the distance between the photovoltaic power station and the industrial center of the power load center, the power demand in the mountain area is not high, resulting in the grid in the load concentration area when the transmission of electricity overload.

Ninh Thuan Province, Vietnam, has a high potential for photovoltaic power generation, although it is equipped with 2,000 MW capacity of power generation equipment, but the actual transmission grid capacity is only 800 to 1,000 MW, so there is a phenomenon of photovoltaic power abandoned.

Wind power also faces the problem of insufficient transmission grid capacity, photovoltaic power generation projects and wind power projects are developed at the same time, resulting in a very limited transmission grid capacity that can be used. To this end, the Vietnamese government plans to invest about 4.3 billion US dollars to expand 8,200 kilometers of transmission grid projects, and on this basis, to build smart grids at the same time.

Phased goal of smart grid construction in Vietnam

~ 2013: Completed the installation of remote detection system, SCADA and data acquisition system for power plants with a capacity of more than 110kV and over 30MW.

~ 2016, 100% EMS function of SCADA/EMS system in regional power distribution centers, including the National Load Dispatch Center (NLDC).

By 2022, SCADA/DMS will be installed for each power company and remote inspection systems will be installed for large power users.

SCADA: Abbreviation for Supervisory Control And Data Acquisition, known as SCADA or Supervisory Control Data Acquisition System. Through SCADA systems, companies or government agencies can remotely control all equipment used on production sites and collect relevant data. Therefore, technology is being widely used in the fields of energy, infrastructure, water and sewer, and automotive.

Vietnam smart grid construction roadmap

The Vietnamese government plans to complete the construction of a smart grid system from 2012 to 2022 and has announced a roadmap for its development. It is divided into three phases, and four segments are currently being developed.

The first phase (2012-2016) aims to improve the operational efficiency of the power system and pilot projects.

The second phase (2017-2022) includes implementation plans for smart home and smart city pilot projects. Plans for decentralized power generation, new energy generation, and energy storage are also included.

The final and third stage (after 2022) clearly stipulates the installation of ICT infrastructure for distribution networks, the stabilization of electricity supply based on the demand for residential areas, and the control of electricity through smart applications.

In order to complete the construction of phases 1 to 3, local governments in Vietnam have drawn up detailed implementation plans and are currently actively building.

Vietnam's Ho Chi Minh City is developing AI to automatically forecast electricity demand through the use of big data to analyze industries and customers that need electricity, and coordinate demand and supply to the maximum extent, thus effectively reducing electricity waste and effectively reducing costs.

An official of the Ho Chi Minh City Electricity Corporation (EVNHCMC) said that it has recently stepped up efforts to rectify old facilities and build a new grid system with a length of 250 km.

Vietnam's domestic power industry has great potential for development, and foreign capital is also actively involved in the construction of Vietnam's power industry. In Vietnam's electricity market, energy management systems (EMS), energy storage devices (ESS) and EV charging infrastructure are the most attractive.

Energy management systems (EMS) are developed in a government-supported manner in Germany, China and Japan, among others. In 2013, Vietnam and Japan cooperated in building a demonstration energy management system "Green Hospital Project" in two public hospitals in Vietnam, which achieved the goal of saving energy and reducing carbon emissions through the installation of inverter air conditioners in the hospitals.

Energy storage devices (ESS) are in the early stage of market development in Vietnam, and the country is keeping a high level of attention in order to achieve efficient power supply. The imbalance of power supply in Vietnam's cities and localities is largely addressed through energy storage devices (ESS).

EV charging infrastructure is an area that needs to be focused on, as electric vehicles and electric motorcycles are widely popular in Vietnam, but the country's infrastructure is still lagging behind. Due to the adverse effects of various taxes, insufficient technical capacity, and safety issues, the construction of EV charging stations in Vietnam is seriously insufficient, so charging infrastructure construction projects are also actively planned.

Vietnam's largest car manufacturer Vinfast, a car brand founded by Vietnam's largest real estate developer Vingroup, plans to complete the construction of 2,000 electric vehicle charging stations by 2021.

As mentioned above, the power industry in Vietnam, which previously focused on expanding the supply of infrastructure, is now striving to further improve the efficiency of operations and management. Therefore, companies planning to enter the Vietnamese power market need to focus on the development of technologies that can achieve efficiency gains.