Vietnam wants to connect rooftops, batteries and electric vehicles into a single virtual power plant

Vietnam is preparing to move beyond basic time-of-use tariffs and industrial demand response programmes towards virtual power plants. The information was shared by Vietnam’s Ministry of Industry and Trade in a publication prepared by Nguyen Huy Hoach of the scientific council of Vietnam Energy Journal.

Vietnam’s approach to VPPs

The virtual power plant concept is already being explored in many other regions of the world. In Vietnam, it would involve combining distributed rooftop solar, behind-the-meter battery storage and electric vehicles into flexible grid assets.

By coordinating thousands of distributed energy resources through algorithmic dispatch and control systems, grid operators could absorb potential surplus solar generation around midday and then dispatch the stored energy during the evening peak in demand.

Why does this matter now?

The Ministry of Industry and Trade’s (MOIT) early public presentation of the VPP concept is significant because Vietnam is grappling with excess solar capacity. This has led to severe grid constraints and generation curtailment in the country’s central and southern provinces.

MOIT’s presentation of the VPP aggregation concept points to potential benefits for grid stability. There are also challenges. Vietnam’s electricity market structure, in which the state-owned utility EVN holds a near-monopoly over transmission and dispatch under a single-buyer model, means that the country will need a clear regulatory framework for resource aggregation, aligned with existing market rules, for VPPs to become operational and economically viable.

As the publication’s author noted, a remaining challenge is to develop an appropriate roadmap and a mechanism that would allow distributed energy resources to participate efficiently and transparently in the electricity market.