Economy - June 13, 2023 | 03:43 pm PT

Anatomy of north’s desperate power shortage

Le Dinh Hung, who works for a phone components manufacturer in Bac Ninh Province, was given a day off because of a power blackout.

It was the first time in nearly 10 years. After 8 p.m. on June 4, he received a message from his manager saying he would not have to come for work the next day since a power cut was scheduled for 5 a.m. to 5 p.m.

He said many colleagues at the Yen Phong Industrial Park in the province and the Thang Long Industrial Park in Hanoi have been given alternate days off for the same reason.

In many places in the north, businesses are having to suspend production because of power outages.

Recent evenings at Hoan Kiem Lake, the heart of the capital city, have been likened to "Earth Hour" days as early as lighting for flower gardens, sidewalks and around the lake is turned off at 7 or 8 p.m.

The area at the intersection of Trang Tien - Dinh Tien Hoang streets, Hoan Kiem District, Hanoi, in the evening is dark because street lights and billboards are turned off. Photo by VnExpress/Ngoc Thanh

Turning off lights to save electricity has become the norm in Hanoi and many other cities and provinces on the recommendation of state utility Vietnam Electricity (EVN).

Street lights are partially switched off while electricity is completely cut off in many residential areas.

Power utilities were forced into emergency load shedding in some places in Hanoi and northern provinces this month to ensure the safety of the system.

The Bac Giang Province would reduce electricity for daily use to prioritize industrial production from June 6, Le Anh Duong, chairman of its People’s Committee, said at a meeting with businesses.

Do Thi Lan, deputy head of the National Assembly’s Committee for Social Affairs, said on the sidelines of a session on June 5: "The power cut is not just for one or two hours but also both during the day and night, and so it seriously affects people’s lives and the socioeconomic situation.

"Such an electricity shortage is very worrying."

The hot season has just begun, and the economy is recovering, but many businesses still lack orders and some production and business areas continue to languish, she said.

In April, EVN had warned the north could face electricity shortages equivalent to 1,600-4,900 megawatts during the summer.

At a government press conference on June 4, Deputy Minister of Industry and Trade Do Thang Hai said shortages were already upon the north, and affected both industrial production and daily life.

Tran Viet Hoa, director of the industry ministry’s Electricity Regulatory Authority, said on June 7 that the availability in the northern region, including imports, was only 17,500-17,900 MW equivalent, or 59.2% of installed capacity.

Demand is currently at 20,000 MW and could increase to 23,500-24,000 MW due to the hot weather, he said.

"The north’s electricity system faces a risk of shortage most times of the day."

50% of the lights on Hanoi’s Long Bien Bridge are turned off and so people depend on the lights in their vehicles to move. Photo by VnExpress

‘Hot spot’ in the north

The spike in electricity consumption due to the heat wave is the main reason cited by the ministry of Industry and Trade and EVN for the current shortages.

The average electricity demand in the country in May was nearly 820 million kilowatt-hours a day, or more than 20% higher than in April.

On May 19 it was nearly 924 million kWh, 10.5% higher than a year earlier.

In Hanoi, where there have been regular power outages in many areas since early June, consumption spiked last month and early this month.

The Hanoi Power Corporation said the average consumption in May had been more than 75.4 million kWh, up 22.5% from April. As of June 4 the average consumption reached at nearly 88.5 million kWh.

But supply has been well short.

Power in the north is mainly derived from hydroelectric and thermal plants.

But hydropower production, which accounted for 43% of supply as of May, has slumped due to extreme weather which has dries up large reservoirs.

Their average production has halved from last year to 12-15% of total supply.

By the end of May they only had enough water to generate 1.23 billion kWh of electricity, enough for four days’ consumption based on the peak demand of 313.6 million kWh on May 22.

As of June 3 the dams at the Lai Chau, Hua Na, Thac Ba, Son La, Tuyen Quang plants only had enough water to generate electricity for 0.4-0.9 days.

At Lai Chau and Son La, among Vietnam’ largest plants, water in the dams has gone below the dead storage level, a major operational risk.

In all 11 plants have shut down, summarily taking 5,000 MW out of the grid.

Another reason for the power shortage is that some coal-fired power plants, which account for 48% of the electricity supply in the north, have reduced capacity or encountered problems.

As of June 1 units at nine plants, Pha Lai 1 and 2, Cam Pha, Vung Ang 1, Nghi Son 2 BOT, Mao Khe, Quang Ninh, Thang Long, and Son Dong, had problems after operating continuously in hot weather for a long time.

Unit 1 at the Nghi Son 2 BOT project is expected to be repaired by mid-July, according to Deputy Minister of Industry and Trade Dang Hoang An.

The total capacity of the nine units has been reduced by some 4,200 MW.

Not just because of the heat

For many years the north has not added new plants though a shortage has long been forecast, and so the culprit is not just the weather and mishaps, according to analysts.

It is the region with the highest growth in demand in the country, 9.3% a year in 2016-20 adding up to nearly 6,000 MW.

But the annual growth in generation in the period has only been 4.7%, reaching 4,600 MW.

In the central and southern regions, the growth in power generation capacity has been many times higher than demand.

Construction of most new large power plants in the north such as Na Duong I, Hai Phong III and Cam Pha III has been tardy due to issues related to project formulation, investor selection, raising capital, and site clearance, giving rise to the specter of power shortages until 2025.

This is acknowledged by the ministry of Industry and Trade in its report to the government on the National Power Development Plan VIII.

This puts great pressure on the inter-regional transmission network, increasing losses and risks, it added.

EVN’s plants account for more than 38% of the country’s supply, with the rest coming from plants belonging to Vietnam Oil and Gas Group, Vietnam National Coal and Mineral Industries Group, some BOT facilities, and privately owned renewable sources.

According to Bui Van Thinh, chairman of the Binh Thuan Wind and Solar Energy Association, the National Power Development Plan VII has not been strictly adhered to, with many plants belonging to companies like PVN and TKV not being built due to various reasons, leading to a threat of shortages.

A number of plants such as Na Duong II, Cam Pha III, Hai Phong III, the gas-electricity project chain Block B O Mon, Ca Voi Xanh, and Son My LNG are behind schedule.

Earlier this year the Thai Binh II thermal power plant entered commercial operation after more than a decade of delays.

In its first phase of operation, it is running at only 75% of capacity as technical adjustments are carried out.

Transmission capacity is also an issue, which puts more pressure on supply in the north.

In the revised National Power Development Plan VII, the ministry acknowledged that the operation of power grids faces many difficulties.

In some areas 220-kV and 110-kV power grids are overloaded, posing risks.

Most transmission projects are one or two years behind schedule due to issues mainly related to compensation and site clearance.

It takes several years to build a transmission grid, but only three to six months to build a renewable power plant, and so a mismatch in capacity is inevitable.

Workers from the Long Bien Power Company in Hanoi prepare to handle power grid problems at noon on June 2. Photo courtesy of EVN

The irrational distribution of power plants – for instance, concentrating wind and solar power projects in the central region where electricity demand is low and in the south -- also causes regional supply-demand imbalance, affecting the inter-regional transmission network.

According to the ministry, most renewable energy developers and provincial authorities pay attention only to their local power grids and lack an overall view of the regional power system.

Local congestion occurs as a result, reducing renewable energy supply at some point, it said.

Currently the 500-kV north-south transmission line is operating at its peak capacity of 2,500 MW. Sometimes it even operates above this threshold to carry electricity to the north.

Stopgap and long-term solutions

At present, in addition to fully tapping domestic power sources, including renewables, Vietnam is also buying 10-12 million kWh per day from China and Laos.

According to the ministry, the imports account for only 2.7% of the daily demand of 445-450 million kWh in the north.

The ministry and EVN have called on domestic and commercial users to conserve electricity during the hot season, but this is hardly a solution for the long run.

According to experts, speeding up work on power generation and grid projects is an urgent requirement.

The National Power Development Plan VIII has just been approved by the government after nearly six years of drafting and revisions. It will serve as the basis for these projects.

Normally, it takes several years to plan and implement power projects, and so authorities need to speed them up to avoid being dependent on the weather, energy expert Dao Nhat Dinh said.

According to legislator Do Thi Lan, the action plan for the electricity plan is still under development, and the Ministry of Industry and Trade needs to speed it up.

Workers repair a transformer at an apartment block in Hanoi on May 31, 2023. Photo courtesy of EVN

"I suggest the Government makes a comprehensive re-evaluation of strategic plans for ensuring supply of electricity for industrial production and socioeconomic development, and adopts specific solutions to overcome the electricity shortage.

"There must also be a response to climate change and other unusual, extreme weather situations."

The power plan sets a target of 2,600 MW of rooftop solar power not linked to the grid and thus serving only households by 2030.

The north can generate solar energy for some 1,000 hours a year, mainly in the dry season.

"The mechanism for this (solar power) needs to be clear to avoid overdevelopment while encouraging households to invest in it," Dinh, the energy expert, said.

While waiting for solutions, many businesses are forced to adjust their plans, shifting production from peak hours to off-peak hours, even nights.

But Hoang Trung Dung, director of the Additives and Petroleum Products Joint Stock Company in Hanoi’s Gia Lam District, said: "We agree with the need to conserve electricity, but cutting off power for industrial production is not a reasonable solution."

Story by Hoai Thu
Graphics by Phuong Dong