Demonstrating a battery energy storage system in the commercial and industrial sector

Wednesday January 26th, 2022

USAID Vietnam Urban Energy Security Project

The USAID Vietnam Urban Energy Security project (2019-2023) works closely with the Government of Vietnam at the city, provincial, and national level to improve legislation related to clean energy, mobilize investment, and increase the adoption and deployment of innovative energy solutions.

The Innovation Challenge Fund (ICF)

The Project’s Innovation Challenge aims to fund 20 pilots and/or demonstrations of new products, business models, or financing models for advanced, distributed urban energy systems between September 2021 and March 2023. 

Advanced energy solutions exist in areas such as building efficiency, transportation, and electricity generation. These can contribute to the goal of greater urban energy resilience and energy security, however there is resistance to their uptake because 1) proof of concept has not been demonstrated, and 2) potential customers do not know solutions exist and are therefore unaware of the potential benefits.

Through the Innovation Challenge, the Project will support the piloting and/or demonstration of innovative ideas in Danang and/or Ho Chi Minh City (HCMC) with the potential to achieve scale and commercialization. 

Organizations that are registered in Vietnam, with bold ideas across the following categories will be encouraged to apply: transportation, building efficiency, electricity generation, electricity delivery and management, and water efficiency.

The Problem

Due to Vietnam’s growing economy, national electricity consumption is projected to grow 8 percent annually until 2035. To meet this demand, Vietnam’s electricity system will need to more than double its power generation capacity and significantly expand transmission and distribution. 

The country will need to harness existing renewable energy capacity to its fullest extent. Solar power generation capacity currently accounts for 16,500 MW – nearly 25 percent of the total installed capacity of the national power system – however, grid congestion has increasingly occurred, forcing solar electricity to be curtailed and not be fully utilized in the power system. As variable renewable energy sources including rooftop solar continue to scale up in Vietnam, managing and mitigating any strain on Vietnam’s power grid will be essential. Battery energy storage systems (BESS) will play a key role in providing valuable services to the electric system while enabling greater utilization of existing renewable energy generation.

The Solution

BESS solutions will play an increasingly pivotal role in balancing green energy supply with growing electricity demands, in part because they enable energy from renewables, like solar and wind, to be stored and then released when energy users and grid operators need power most.      

The Consortium for this assignment comprises four organizations with the combined experience, skills, and market knowledge to demonstrate a BESS, document the project achievements and challenges, and share findings with key market stakeholders.

The work will include the negotiation with site owners, final site selection, design and installation, sale, and commissioning of a BESS integrated with the solar photovoltaic and wider market sharing of the lessons learnt throughout the process.

Description of the Solution

Hooked up to the network, interlinked battery storage systems could solve many of the energy challenges faced by producers, providers, and customers. 

One of the greatest challenges facing renewable energy producers is that, unless the electricity generated by biomass, water, wind, and solar power systems is fed directly into the grid or used immediately, it is lost.

Capturing this excess energy so it is ready to use is a fundamental challenge that requires energy storage innovation. BESS offers those producing renewable energy or those wanting to efficiently store energy the opportunity to capture this electricity in a network of batteries.

The project demonstrates the installation, commissioning, operations, and maintenance services of a BESS, directly benefiting a client with an operational rooftop solar project. The Consortium aims to demonstrate that the BESS can provide commercial applications including peak shaving, load shifting, and emergency backup.

The project will be executed in six months at a selected location in either Danang or HCMC after the site selection process. The BESS system will utilize a monitoring system capable of providing real-time and historical data. The final report will include the final costs and financing structure, and the projected BESS system performance and economic benefit.

Pilot/Demonstration Activities

Identification of Potential Pilot/Demonstration Sites 

The Consortium will conduct in-depth site data collection to deliver an Appropriate Facility Analysis Report for three commercial and industrial (C&I) facilities that have potential for a BESS pilot/ demonstration. 

Site Selection and Terms and Conditions Finalized

The final pilot/demonstration site is to be selected based on a combination of technical viability, economic attractiveness, financing availability, policy and regulatory alignment, and customer interest. The site will be representative of other locations and C&I facilities in Vietnam that are likely to benefit from similar BESS solutions in the future.

 Installation and Commissioning

 BESS systems are installed adjacent to a solar project, but may also be located at a substation, or in another key location on the distribution line between the two. Depending on the configuration, either solar or substation power can be used to charge the batteries.

Documentation and Dissemination

Lessons, challenges, and achievements will be documented and disseminated by both the consortium and the Project, and will include a case study, an installation manual, webinars/workshops and possibly exchange visits with relevant stakeholders.