Vietnam’s energy storage sector will be a beneficiary of US$35 million funding from the Asian Development Bank (ADB) and non-profit Global Energy Alliance for People and Planet (GEAPP).
The two organisations have partnered to make the funding available to improve energy access and accelerate the transition away from fossil fuels in the South and Southeast Asian regions.
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As ADB managing director general Woochong Um said as the agreement was announced, two of the bank’s most important priorities are “expanding clean energy for the 350 million people in our region who have either limited or no access to electricity,” as well as catalysing the transition “from coal and other fossil fuels toward clean, affordable, and reliable energy sources”.
Meanwhile, GEAPP CEO Simon Harford said that while there is a big opportunity to address those major challenges and decarbonise the region’s energy sector, low and middle-income countries only accounted for 8% of the world’s total energy transition investments in 2021.
That was the lowest share seen in 10 years, and while 2022 was slightly better, with 15% of investments made worldwide seen in low and middle-income nations, it still isn’t enough.
“We need to do better and act bolder, knowing we will only meet critical climate goals through collaboration and meaningful capital commitments,” Harford said.
A formal signing ceremony was held last week in Washington DC, the US, to cement the partnership, with the funding to be managed by a new fund set up by GEAPP, an organisation that describes itself as “an alliance of philanthropy, local entrepreneurs, governments, and technology, policy, and financing partners”.
The GEAPP Energy Access and Transition Trust Fund (GEATTF) will assist with energy access and energy transition efforts in five countries: Indonesia, Vietnam, Bangladesh, India and Pakistan.
However, two priority programmes mentioned by GEAPP in a release were for supporting battery energy storage system (BESS) development in Vietnam, and supporting the phaseout of coal in Indonesia.
While neither party went into specifics on what those programmes might entail, the partnership will provide technical assistance, grants to partially fund projects and blended concessional finance instruments to mobilise and attract private investment.
Southeast Asia’s energy storage sector is seeing an uptick in investments over the past couple of years, with the Philippines in particular seeing a rapid buildout of battery storage resources. High upfront cost of investment in advanced energy technologies and other barriers such as regulation and bankability issues have at the same time been seen to be holding the region back from faster adoption, which the new partnership seeks to address.
Vietnam has seen a major growth in its installed solar PV capacity in the past few years, but successful grid integration of that renewable energy is an unanswered question that energy storage could help answer.
Li-Cycle in Vietnam recycling partnership
In related news, North American lithium battery recycling company Li-Cycle has been signed up as a strategic and preferred recycling partner to Vietnam-based battery and energy storage system manufacturer VinES Energy Solutions (VinES).
VinES is currently building Vietnam’s first lithium iron phosphate (LFP) battery cell ‘gigafactory’ in a joint venture (JV) with Chinese manufacturer Gotion, as reported by Energy-Storage.news last November as construction began at the 14-hectare site. VinES’ devices will be sold into both electric vehicle (EV) and stationary battery storage markets.
The agreement with Li-Cycle takes effect from 2024. Li-Cycle, which has pursued a strategy of building its recycling facilities close to end-demand centres, locating them on both West and East Coast regions of the US, for example, could also build a facility in Vietnam, the company said.
Until an investment decision is made on that, expected in 2025, VinES materials will be recycled at Li-Cycle’s North American sites. In February the recycling specialist got a loan commitment worth US$375 million from the US Department of Energy’s Loan Programs Office.
Energy-Storage.news’ publisher Solar Media will host the 1st Energy Storage Summit Asia, 11-12 July 2023 in Singapore. The event will help give clarity on this nascent, yet quickly growing market, bringing together a community of credible independent generators, policymakers, banks, funds, off-takers and technology providers. For more information, go to the website.