Addressing Grid Congestion and Record Peak Demand

The MOU was signed as Vietnam’s electricity demand continues to reach record highs. During the heatwave in late June 2026, the national power system’s peak demand exceeded 58,000 MW. The sharp increase in cooling demand has placed unprecedented pressure on the country’s existing grid infrastructure.

Although Vietnam has rapidly expanded its renewable energy capacity in recent years, transmission constraints have caused localized grid congestion. This has created a paradox: the system must curtail solar and wind generation during periods of peak output, yet faces significant supply challenges during evening peak-demand hours.

Addressing these infrastructure constraints through grid modernization and investment in energy storage is therefore essential not only to achieving long-term climate goals, but also as an urgent technical solution for safeguarding national energy security, particularly during the dry-season peak months. Flexible resources such as battery energy storage systems (BESS) can store surplus renewable energy generated during the day and discharge it to the grid during peak hours, thereby optimizing available resources, easing grid congestion, and maintaining overall system stability.

This MOU establishes a framework for collaboration between the two sides through technical cooperation, knowledge exchange, research and capacity building. Building on their existing relationship, the MOU reflects a shared ambition to support Vietnam's clean energy priorities while contributing to the country's goals of enhancing energy security, scaling renewable energy and achieving net-zero emissions by 2050.

Advancing Toward 16.3 GW of Battery Storage and a Digitalized Power Grid

Under the MOU, the Global Energy Alliance and EAV will work together to explore cooperation across several strategic areas that are critical to Vietnam's evolving energy landscape. These include supporting a just and inclusive energy transition, advancing Battery Energy Storage Systems (BESS) and other technologies that improve system flexibility, promoting power grid modernization and digitalization, accelerating renewable energy integration, and strengthening institutional and technical capacity through knowledge exchange and collaboration.

Beyond BESS deployment, artificial intelligence (AI) and digital technologies have also become central to grid-modernization strategies in other emerging economies across Asia. AI-powered analytics platforms enable real-time load forecasting, optimize the dispatch of energy stored in BESS, and proactively identify transmission bottlenecks. According to the International Renewable Energy Agency (IRENA), AI algorithms can reduce renewable energy forecasting errors by up to 45%, while shortening the duration of grid disruptions by 30%–50%.

A notable example from the Global Energy Alliance’s digitalization portfolio is the Energy Transitions Innovation Challenge (ENTICE) in New Delhi, India. Through the program, the Alliance supported the development of an AI-powered hyperlocal demand-forecasting platform for electricity distribution companies. Combined with the deployment of a pioneering utility-scale BESS in New Delhi, this technology has directly improved the reliability of electricity supply for more than 100,000 people. Lessons learned from applying AI to real-world grid operations will provide an important reference for technical assistance in Vietnam.

“Vietnam's energy transition requires strong collaboration between governments, organizations and development partners to ensure the country can continue meeting its growing energy needs while advancing its clean energy ambitions," said Mr. Tang The Hung, Deputy Director General of The Electricity Authority of Vietnam.

The partnership builds on the complementary strengths of both organizations. As the government agency responsible for advising the Ministry of Industry and Trade on the management and development of Vietnam's electricity sector, EAV plays a central role in shaping policies and technical approaches that support renewable energy development, electricity market reforms and energy security. The Global Energy Alliance brings international experience in supporting equitable energy transitions through technical assistance, partnerships and knowledge sharing across emerging and developing economies.

“Vietnam’s energy transition is critical to Southeast Asia’s clean energy future. Our partnership with the Electricity Authority of Vietnam reflects the collaboration needed to meet rising power demand while advancing the country’s net-zero ambitions. Building the grids of the future, through stronger infrastructure, resilient battery storage and greater digitalization, will be essential to creating a more reliable and future-ready power system. We look forward to working with EAV to turn this framework into tangible progress on the ground and help deliver a cleaner, more resilient energy future for Vietnam.” said Woochong Um, CEO of the Global Energy Alliance for People and Planet.

The MOU serves as a non-binding framework for future collaboration, with individual initiatives to be developed separately in accordance with the mandates of each organization and applicable Vietnamese laws and regulations. It also reaffirms both organizations' commitment to maintaining an open platform for dialogue and technical cooperation as Vietnam continues to accelerate its energy transition.

Through continued collaboration on technical assistance, capacity building and knowledge exchange, the Global Energy Alliance and the Electricity Authority of Vietnam aim to help strengthen the foundations for a cleaner, more resilient and more inclusive energy system that supports the country's long-term economic development while advancing its climate commitments.