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FY2023 Subsidy-Based Infrastructure FS Project
for Overseas Expansion
Project Reports
R2 General subsidy Construction & Urban Development

Business feasibility study for high-quality power
infrastructure and efficient use of energy
in Da Nang Smart City, VietnamTOKYO ELECTRIC POWER SERVICES CO., LTD.

Project Reports: TOKYO ELECTRIC POWER SERVICES CO., LTD.

1Overview of infrastructure/energy infrastructure

We plan to implement a smart energy pilot project based on Japan’s superior technology in an industrial park called Da Nang Hi-Tech Park (DHPIZA), located in Da Nang City, Vietnam, and enhance its power supply capacity and reliability.
Specifically, we are aiming to install rooftop Photovoltaic (PV) panels, storage batteries, PCS, smart meters, FEMS, and BEMS in public facilities, factories and buildings (and homes in the future) in DHPIZA, monitor and control the distributed equipment using an EMS, promote local production of energy for local consumption, and provide a back-up in case of power outages. In addition, we will also consider upgrading the existing distribution automation system (DAS) and interconnecting to future AMI.

Project Reports: TOKYO ELECTRIC POWER SERVICES CO., LTD.

2Distinguishing characteristics,
such as competitive advantages

We aim to improve Japan’s competitiveness by actively utilizing superior Japanese products. Improving price competitiveness is also important, and we aim to reduce costs by utilizing Vietnamese human resources and promoting localization at the industrial park. Promising competitive technologies are listed as follows:

  • A back-up measure for power shortages/outages by controlling the distributed PV and storage batteries through an EMS (no track record in Vietnam)
  • Storage battery technology
  • Problem solving technology through the integration of DAS and EMS to handle cases where a large amount of PV is introduced into to the distribution network
Project Reports: TOKYO ELECTRIC POWER SERVICES CO., LTD.

3Needs of target countries and regions,
and their issues and solutions

While the power demand in Vietnam has been increasing every year, the construction of power supplies is not progressing as planned, resulting in scheduled power outages. As a countermeasure against the power shortage, FIT was stipulated and PV promotion was boosted; however, purchase by power companies is not progressing, and the installation of expensive storage batteries has not been implemented, so much of the power generated by PV is being wasted.
Through this project, the surplus power generated by distributed PV systems will be effectively used without wasting it, helping to combat power shortages.

Project Reports: TOKYO ELECTRIC POWER SERVICES CO., LTD.

4Expected impact of the project

Project Reports: TOKYO ELECTRIC POWER SERVICES CO., LTD.
1

Solutions to the needs and issues identified in 3 and their benefits

Electricity in the industrial park will be controlled by the center’s EMS, with a rooftop PV panels and storage batteries distributed in factories, and the shortfall will be supplied by EVN, the Vietnamese electric power company. This will contribute to reversing Vietnam’s power supply shortage and reducing electricity tariff through efficient operation. Furthermore, in the event of a power outage in the EVN system, power will be supplied to important loads in the industrial park without interruption through EMS control, which is expected to improve power reliability.

2

Indicators showing the impact of the project

Although it is an estimate, the combination of rooftop PV and storage batteries will be able to supply 75% of factory loads, 50% of commercial buildings, and 90% of households. As a countermeasure against power outages, we can expect to achieve virtually uninterrupted power supply for crucial loads from factories, etc. We can also expect to see utilization of renewable energy such as PV, as well as a CO2 reduction effect by not using the in-house diesel/gasoline power generators. Consequently, products manufactured in the industrial park may be sold as green products.

3

Final estimation of quantitative figures

Utilizing PV/storage batteries in the DHPIZA, local energy production and consumption is expected to exceed the aforementioned estimates. In addition, the annual power outage time for one customer is expected to be less than 5 minutes, similar to Japan.

4

Progress of the project and orders received after the study

After conducting the feasibility study project, a smart city survey in Da Nang City was implemented in FY2021 in accordance with the SMART JAMP scheme. As part of this survey, we took charge of the smart energy survey for Da Nang High-tech Park and conducted it accordingly. While we reported the results of these two surveys via online meetings, we visited Vietnam at our own expense in August 2022 as a follow-up to the project and reported the results face to face.

5Future plan for the project

  • Consider financial support for model projects in FY2022
  • FY2023, start examining the model business
  • From FY2025, roll out the project with Vietnam’s own funds and other fund sources
Project Reports: TOKYO ELECTRIC POWER SERVICES CO., LTD.

6Opportunities to roll out the project

As this is the first concept/system for Vietnam, we do not expect Vietnam’s own funds or loans to be used to promote the project. In order to promote the project, we believe that a model business (based on Japanese technology and products) with Japanese assistance as the first step will be required. Once benefits are confirmed in the model business, we can expect to expand sales to other regions using Vietnam’s own funds or JPY loans. Furthermore, with this track record and cost reduction through localization, the competitiveness of Japanese companies can be improved, and sales expansion to neighboring countries such as Southeast Asia can be expected.

7Benefits of using the subsidy-based high-quality infrastructure/energy infrastructure FS project

Since it was a subsidized project supported by the government, it was useful for web conferences with Vietnamese government public institutions and for obtaining materials. We believe that Vietnamese government agencies would not have actively cooperated if it was a private study, making it difficult to obtain useful materials and data. Through this project, we believe we were able to build a good relationship with Vietnamese government agencies, and gained an advantage in our future business deployment. In addition, we saw a path to the provision of financial support by the Japanese government (such as grants-in-aid and JPY loans) as an extension of this project. The possibility of such support is also of great benefit.

8Inquiries regarding this business

TOKYO ELECTRIC
POWER SERVICES CO., LTD.
Contact person: Atsushi Fujisawa
TEL: +81-3-6372-5965
email: fujisawa@tepsco.co.jp