Applying electricity storage systems for developing the clean energy system in Vietnam

In the report, there are expressed the need, role and challenges in developing electricity storage systems and a number of proposals to the Prime Minister, Head of Central Economic Commission and Minister of Industry and Trade as follow:

(i)Current status of Vietnam's power system with high RE (solar and wind power) rate, and the capacity of RE projects is greatly fluctuated.

(ii) Advantages and disadvantages of operating a power system with a high RE rate.

(iii) Demand and necessity of electricity storage in the current and future power system of Vietnam.

(iv) Introduction of energy storage technologies on the market. Prices and rapid decline in prices of energy storage systems.

(v) International experience in operating power systems with high RE rate and inter-country connection.

(vi) Economic losses and financial risks of RE investors in the case of reducing power generation or stopping operation due to transmission grid congestion and lack of electricity storage systems

(vii) Proposing additional policies, mechanisms and technical regulations to create the conditions for research, investment and operation of energy storage systems.

The above contents were concentrated by the Conference participants from the Office of National Committee for Electricity Development, Electricity Regulatory Authority of Vietnam (ERAV), Electricity of Vietnam (EVN), National Load Dispatch Center (NLDC), National Power Transmittion Corporation (VNPT), Vietnam - Denmark partnership program on energy, the Foreign and Domestic Companies as SMA, Growatt, Solis, Hopewind, PECC 2, PECC3,

Based on prsentations, discussions in the conference, the Energy Magazine Scientific Council would like to present a number of contents related to energy storage system and proposals related to policy on developing energy storage systems as follow:

I. The need and role of energy storage systems:

Energy storage technologies are divided into 4 main groups: (i) Thermal; (ii) Mechnical; (iii) Electrochemical; (iv) Electrical.

According to international energy experts, when RE electricity rate reachs 15% up, the investment in energy storage system is economically efficient. So, in many countries over the world, the energy storage systems have become the necessary technologies in demand side management, RE and smart grid development.

II.Challenges in energy storage development:

Although the costs of storage batteries and technologies are reducing, they are still high, especially for batteries with up to 4 hours of energy discharge per charge-discharge cycle. Solar and wind power investors can only invest in small-scale storage batteries to store a small part of the generating electricity at times of RE reduction and discharge it to the system at peak hours for reducing losses of the investors due to RE electricity cutting. Because there are no regulations on the electricity prices for ancillary service systems, the electricity price from storage batteries is so high that could not be efficient enough to encourage investment.

Bac Ai pump-storage hydropower with a capacity of 1200MW is the largest power storage project that EVN makes investment with expectation to be put into operation in 2026. This project can discharge electricity for up to 5 hours at peak times, but it is responsible for shifting load diagram on only 500 kV grid in South Central region and can not solve many bottlenecks on 220 and 110 kV grids in the other areas.

In the world, at present, beside pump-storage hydropower plant for peak covering, the lagest power storage system reachs only 150 MW and same projects with 500 -600 MW are developing in Australia.

III. A number of proposals for energy storage development:

- The Government needs to continue to study further and allow the experimental applying the power storage models on the Vietnamese power system to confirm the efficiency, necessity and role of the energy storage systems (including electrical, heat, electrochemical, mechanical storages…), from which regulations and mechanisms on auxiliary services of the power system can be issued for increasing the overall efficiency of the energy system. In the immediate future, it is proposed to add the amount of energy storage systems in the list 2021-2030 of the Power Development Planning VIII to serve as a basis for implementation.

- The Ministry of Industry and Trade (MOIT) should assign EVN to invest in exprimetal electricity storage batteries with a scale of 100 -: - 200 MW on the transmission grid for gaining experience in expanding the market.

- Proposing the MOIT to apply the pilot projects on small and micro scale of storage betteries at solar and wind power projects in the short term for reducing gridlock effects.It could be carried out by combined business of the investors and equipment suppliers.

- To encourage the first projects, the Government should promulgate regulations on electricity prices from storage batteries equivalent to the electricity prices in peak hours of the system, or allow electricity prices from RE projects with storage batteries higher than conventional projects.

- Proposing MOIT to urgently develop a regulatory mechanism for the Prime Minister to soon issue market regulations for electricity storage models with considering electricity storage structure as a power system auxiliary service (for frequency, voltage stabilization and backup operation...).

- Proposing the Ministry of Industry and Trade and the Ministry of Science and Technology to soon issue technical regulations for different types of energy storage, as a basis for selecting advanced and environmentally friendly technologies.

- The Government and the Ministry of Industry and Trade need to create maximum conditions for Bac Ai pump-storage hydropower project to be completed before 2028, and at the same time, add other pump-storage hydropower projects to support RE projects and the whole power system in the long term.