Vietnam’s battery energy storage market is experiencing strong development, driven by a combination of rapidly rising electricity demand, increasing renewable energy penetration, regional supply–demand imbalances, and supportive government policies. According to InfoLink, emerging markets outside China, the United States, and Europe are expected to account for a growing share of newly installed global energy storage capacity, increasing from approximately 7% in 2024 to around 18% by 2026. Southeast Asian countries—including Indonesia, Malaysia, Thailand, Vietnam, and the Philippines—are entering an accelerated phase of energy storage adoption. Among them, Vietnam faces particularly acute challenges in balancing its power system, providing a solid foundation for the growth of the domestic electrochemical energy storage market.
Vietnam’s electricity demand is growing rapidly, driven by economic growth, industrial expansion, and urbanization. The World Bank forecasts that Vietnam’s GDP growth in 2025 will remain at around 6%, supported by strong performance in manufacturing and exports. The Ministry of Industry and Trade projects annual electricity consumption growth of approximately 13.5%, with the industrial sector accounting for about 72% of total demand. Increasing manufacturing investment, expanding urban populations, and rising household consumption are placing growing pressure on the power generation mix and grid flexibility, creating clear demand for energy storage solutions.
At the same time, renewable energy capacity in Vietnam is expanding faster than traditional power generation. According to the Power Development Plan VIII (PDP VIII) and its revisions, solar and wind power are expected to account for 25%–31% and 14%–16% of total installed capacity by 2030, respectively, while thermal power gradually declines. By 2025, renewable energy is projected to contribute approximately 38% of total electricity generation, with solar power reaching 25% and wind power 10%. This rising share of renewables introduces greater variability into the power system, particularly during periods of high solar irradiance and strong wind conditions, creating demand for energy storage systems to support peak shaving, grid integration, and renewable energy absorption.
Regional power imbalances between northern and southern Vietnam further increase the need for energy storage. The southern region hosts a large concentration of solar and wind projects, while the north is home to major industrial and population centers. Limited transmission infrastructure and localized grid constraints have led to renewable energy curtailment in the south and supply shortages in the north. Hydropower output in northern Vietnam is also lower during the dry season, exacerbating supply–demand gaps. Energy storage can help smooth renewable generation in the south and support peak load reduction in the north, reducing reliance on coal- and gas-fired power plants.
Government policies are reinforcing this trend, with targets of achieving 10–16.3 GW of electrochemical energy storage capacity by 2030 and nearly 96 GW by 2050. Vietnam Electricity (EVN) has outlined plans for grid-scale and distribution-level battery energy storage system (BESS) projects, aiming to commission 1.2 GW by 2026. Electricity pricing incentives for solar-plus-storage projects offer tariffs 10%–15% higher than standalone solar, encouraging investment in integrated photovoltaic and storage systems. Broader investment incentives, including tax reductions and land support, are also in place, although standalone and utility-scale storage projects remain constrained by unclear revenue structures and an underdeveloped market mechanism.
On the supply side, international and Chinese companies are establishing manufacturing and technology hubs in Vietnam. Fluence Energy and South Korea’s ACE Engineering have commissioned a battery energy storage manufacturing facility with an annual capacity of 35 GWh, while Chinese companies—including Tianneng, Goldwind, and Gotion High-Tech—are expanding domestic production and integrating into regional supply chains. These developments position Vietnam as an emerging regional manufacturing hub for energy storage equipment, although project deployment remains cautious.
Overall, Vietnam’s energy storage market is in a developmental rather than explosive growth phase, with expansion driven by long-term structural demand, policy support, and increasing renewable energy integration. Near-term opportunities are concentrated in solar-plus-storage projects and EVN-led pilot initiatives, while future expansion will depend on electricity market reforms, pricing mechanisms, and scalable business models. For companies with expertise in batteries and energy storage systems (ESS), Vietnam presents a timely opportunity to establish a strategic presence amid Southeast Asia’s ongoing energy transition.
Source: SolarQuarter
