Domestic firms make efforts to dominate energy technology sector

Domestic companies are striving to lead in the energy technology sector, according to experts. Rapid economic growth is not solely determined by GDP growth rate, but by factors that generate growth, such as capital, labor, natural resources, and foreign investment. To become a developed economy, Vietnam must transition from merely participating in the value chain to mastering a significant portion of it.

This requires Vietnamese businesses to not only produce products based on existing designs, but also to develop technology, products, standards, brands, markets, and the ability to create added value.

In the battery energy storage system (BESS) industry, Vietnam can currently import batteries, inverters, PCS, and BMS and assemble them into a completed system. However, for a domestic BESS industry to thrive, Vietnamese firms must have the capability to design systems, integrate hardware and software, master energy management systems (EMS)/battery management systems (BMS), maintain quality, establish standards, develop products according to market needs, and ultimately create brands that can compete on the international stage.

The BESS industry holds significant potential for Vietnam's development. As an intersection of various industries, including power, power electronics, batteries, software, AI, control, automation, mechanics, thermal, materials, and IT, it can foster a broad industrial ecosystem. With Vietnam's growing electricity demand and increasing share of renewable energy, BESS will serve as a crucial tool for balancing power generation and demand, enhancing renewable energy integration, and improving power system flexibility.

The impact of BESS on the domestic power industry, manufacturing sector, and industrial supply chain will be substantial, extending far beyond the mere sale of batteries. For the power industry, BESS enhances load adjustment capabilities, facilitates renewable energy integration, and boosts system flexibility. For manufacturing businesses, it enables proactive energy management, cost reduction, and increased renewable energy utilization.

Perhaps most importantly, BESS will give rise to a new industrial supply chain, with various domestic firms participating in the value chain.

To enable Vietnamese technology companies to flourish, significant changes in the business environment are required, alongside stable policies to provide long-term investment confidence. Technology companies need to see a well-defined market and know how the system will operate, how energy value will be recorded, how services will be priced, and what investment model can attract capital.

With BESS, the question is not just whether installation is possible, but how the system will function, how stored energy value will be priced, and what investment model can attract capital. When regulations are clear, banks can assess project cash flows, investors can calculate return on investment (IRR), and manufacturing companies can make informed long-term decisions.

Vietnamese businesses can successfully create their own technologies and brands by participating in global value chains, developing their unique strengths, and gradually increasing localisation. Instead of competing with global giants in terms of capital or raw materials, Vietnamese firms can leverage their market understanding, system integration capabilities, product and service development, software expertise, energy solutions, and rapid response to begin with their strengths.

By localizing the technology and expanding regionally, Vietnam can create products designed by Vietnamese people that address domestic challenges, generate value within the country, and compete internationally. This approach aligns with the success of companies like GG Power, which focused on becoming a BESS manufacturer while maintaining their Vietnamese identity and expertise.