Vietnam has joined Asia’s plans to increase the development of battery energy storage systems (BESS) to ensure supplies of round-the-clock renewable energy towards carbon neutrality.
BESS have a crucial role to play in today’s global energy transition as they ensure 24/7 renewable energy supplies, storing excess energy generated from renewable sources and discharging it when demand is high.
The global BESS market grew from $4.34 billion in 2022 to $5.53 billion in 2023 at a compound annual growth rate (CAGR) of 27.4%, according to business intelligence platform ReportLinker.
The market is expected to grow to $13.8 billion in 2027 at a CAGR of 25.7%, the platform said in its 2023 global BESS market study. Major players in the market include BYD, General Electric, Hitachi, Honeywell, Panasonic, Samsung SDI, Siemens AG, Tesla, Toshiba, ABB, Contemporary Amperex Technology, LG Chem, Kokam, Johnson Controls, and Enersys.
In Ho Chi Minh City, Vietnam’s economic powerhouse, American industrial giant Honeywell signed a deal on Tuesday to develop a BESS project in central Vietnam for AMI AC Renewables, a joint venture (JV) between Vietnam’s AMI Renewables and AC Energy, a member of Ayala Corporation, one of the Philippines’ biggest conglomerates.
Simultaneously, the JV received another $3 million grant from the U.S. Mission to Vietnam for the project, following the first grant of $2.96 million from the U.S. government in October 2021. The project will use cutting-edge U.S. technology and equipment.
The BESS will be integrated into a 50-megawatt solar farm the JV owns in Khanh Hoa province, about 400 kilometers north of Ho Chi Minh City. Khanh Hoa borders Ninh Thuan province, a renewable energy hub.
Also in central Vietnam, Vingroup’s VinES Energy Solutions and China-based Gotion High-Tech are co-building a $275 million battery factory, designed to annually produce 30 million lithium iron phosphate (LFP) battery cells. LFP is currently the most mainstream battery technology in the global energy market, with unique advantages of high safety and long life.
The manufacturing facility’s battery cells will be used for electric vehicles and energy storage systems. The plant is located in Ha Tinh province.
This April, VinES embarked on a partnership with Turkish company Altınay Elektromobilite to provide comprehensive energy storage solutions in the Turkish market.
Asia as a whole is aggressively developing BESS projects. India is one of the leading countries when it comes to renewable energy generation as it pursues its target of generating half of its electricity needs from cleaner power sources by 2030.
ReNew Power, one of India’s largest independent power producers, tapped a consortium of international lenders to secure a $1 billion loan to fund its 1,300-megawatt battery-enabled round-the-table renewable energy project in August 2022, marking the largest project finance facility for a single renewable energy project in the country.
In the ASEAN region, Singapore has this year signed agreements with Vietnam, Cambodia, and Indonesia to import clean electricity. Vietnam will export wind power to Singapore under a joint development agreement signed in February between Petrovietnam Technical Services Corp. (PTSC) and Singapore’s Sembcorp Utilities Pte. Ltd.
Singapore-headquartered Sunseap Group in April signed a memorandum of understanding with the administration of the Riau Islands in Indonesia to build large-scale solar energy and storage facilities on the islands to supply power to local communities and Singapore.
EDP Renewables, the world’s fourth largest renewable energy producer, said in November 2021 it had acquired a 91% stake in Sunseap, the fourth largest solar power operator in Southeast Asia.
EDP, Portugal’s largest utility and the parent company of EDP Renewables, announced this March it will step up investment and spend 25 billion euros ($27 billion) over four years to nearly double its renewable energy capacity to 33 gigawatts by 2026. In its strategic plan through 2026, EDP said 21 billion euros would be invested by its wind and solar unit EDP Renewables, and 4 billion euros would go directly to power grids. Part of the investment will also go to energy storage.
The Asian Development Bank (ADB) and the Global Energy Alliance for People and Planet (GEAPP) launched in mid-April a new capital fund to accelerate clean energy access and transitions in countries across South and Southeast Asia including India, Indonesia, Vietnam, Pakistan, and Bangladesh.
The GEAPP will provide an initial $35 million of catalytic capital towards the fund, which will be established and administered by the ADB, and Vietnam’s energy storage initiatives are expected to benefit from the fund.
Priority programs will include BESS in Vietnam and the early retirement of coal-fired power plant initiatives in Indonesia.