Electricity demand has been gradually increasing since 2021 and is likely to surpass domestic output in the near future.
The manufacturing and construction industries are expected to account for the majority of the increase in electricity demand in Vietnam over the next five years, according to VietinBank Securities (VBS).
By 13.3 billion kWh in 2023 and 27.7 billion in 2025, it is predicted that the country’s output will be insufficient to meet the rapid demand, forcing it to import liquefied natural gas and increase its thermal power output to make up the difference.
Given that there are still many barriers standing in the way of green initiatives, VBS did not anticipate that renewable energy would make up a significant portion of the output between 2023 and 2025. However, the switch to renewable energy has already begun, and by 2025, it is anticipated that this form of energy will dominate.
After 2023, Vietnam Electrical worried that the backup capacity rate would steadily decline, causing immediate electricity shortages.
With power production falling 27.7 billion kWh short of demand in 2025, the backup capacity rate is predicted to drop to 18%. The rate could remain as low as 10% in the North throughout that time.