VIETNAM ENERGY OUTLOOK REPORT

1
2023
Consultation Workshop
TIMES modelling team
 Contents

1. 2. Model 3. Results 4. Discussion

Introduction setup &
scenarios

2
3
1. INTRODUCTION

3
 The TIMES modelling team
Local research institutions
(capacity building)

Till ben Hanoi

Electric
Ida Græsted Brahim Alessandro Maurizio Institute of University of
Power
Jensen Chiodi Gargiulo Energy Science and
(Consultant) University
(Partner) (Partner) (Partner) (IEVN) Technology
(EPU)
(HUST)

4
2. TIMES MODEL SETUP AND
5
SCENARIOS

5
 The TIMES modelling framework

MODEL STRUCTURE TIMES IS…

a partial-equilibrium model finding least-cost

solutions for an integrated local, national,
multi-regional energy systems

a technology rich and bottom-up model

energy service demand driven model

assuming perfect markets and foresight

6
 Updates of Vietnam-TIMES Model
• Base year: 2019

• Demand structure: (i) Agriculture (ii) Industry (iii) Residential (iv) Services, (v) Transportation

• Demand profiles: aggregated electricity load curve, sectoral load curves…

• Resources: domestic fossil fuels, renewables, biomass etc.

• Renewable profiles (wind, solar) by region

• Updated technology sets:

— Power generation technologies (Technology catalogue)
— Representations of industrial processes (cement, iron and steel)

— Hydrogen production processes (gasification, steam reforming, electrolysis etc.)

— Electrical vehicles (EVs)

— Battery and storage technologies

— Carbon capture and storage (CCS)

— Direct Air carbon capture (DAC)

• Migration of old model to Veda 2.0 (new interface)

7
 Linking TIMES - Balmorel
TIMES
(Energy system with end-
use sectors)

• Resource allocation: biomass, waste, biofuel,

• Fuel consumption
domestic coal, domestic gas
• Import/export of electricity and prices to
• Electricity demand by sector/category: transport
neighbouring countries
split on mode
• Hydrogen and ammonia domestic production
• Carbon budget allocation
from power sources
• Hydrogen and ammonia use outside power sector

Balmorel
(Power system)

8
 Service demand and technology structure of
Vietnam-TIMES model
•Cement: clinker production (with/without
CCS; hydrogen), cement production (grinding)
•Iron and Steel: crude steel process (BOF, EAF
with/without CCS); machine drive devices,
heat devices (include hydrogen, renewable
fuels)
•Others: Non-metallic Minerals, Ammonia,
Chemical, Extractive, Pulp and paper, Textile
and Leather, Wood products, Food Beverage
Tobacco Processing, Material Construction,
Manufacturing of Machinery and
Equipment, Vehicles manufacturing, Other
3 end-uses: Machine Drive devices, Process
heat, Facilities/Other (with/without CCS)
Industrial
•Cooking: coal, biomass, biogas, electricity,
LPG, kerosene
•Lighting: electricity
•Air conditioning: air conditioner (electricity,
natural gas, heat, biogas )
•Thermal Uses: stove, air-source heat pump,
boilers (electricity, oil, LPG, hydrogen…), solar
thermal
•Electrical Appliances: improved, advanced
Building
•Passenger transportation:
•Road: motorbike, car, light passenger vehicle
(included gasoline, natural gas, LPG,
methanol. electricity, hybrid, fuel cell
vehicles), bus (natural gas, hybrid, electric,
hydrogen, methanol)
•Railway (rail/metro): diesel and electricity
vehicles, high speed rail (electricity),
hydrogen vehicles
•Navigation: diesel, LNG, FO, electricity,
methanol, ammonia, hydrogen vehicles
•Airway: Jet fuel, renewable jet fuel,
hydrogen, electricity vehicles
•Freight transportation:
•Road: light freight vehicle, truck, rail
(gasoline diesel, electricity)
•Railway: rail and high-speed rail
•Navigation: diesel, LNG, FO, electricity,
methanol, ammonia, hydrogen
•Airway: jet fuel, renewable jet fuel,
hydrogen, electricity
Transport
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Scenarios definition
Net-zero target by 2050 is not met , For 2030, unconditional revised NDC is used to set the emission
pathway, i.e. 15.8% emission reduction in 2030 compared to BAU
Baseline
Current regulations on transport (Dec.no 876 QD-TTg) and energy efficiency for industry (VNEEP) are
considered. The development of renewable energy up to 2030 is limited by PDP8. After 2030, land-solar
potential will be limited by unused land area in the land using plans.

The net-zero target in 2050 is achieved in a cost optimal way with peak emissions of the energy system in
2035
Net Zero Least Cost
By 2050, the net-zero target of the national climate change strategy (101 Mt CO2 from the energy
optimized system) is reached. The development of renewable energy is not limited and a larger land-solar potential is
(NZ- Least cost) considered. CCS technologies are allowed. In the transport sector, an increased modal shift from road to
railway is assumed.

The net-zero target in 2050 is achieved but the certain barriers and inertia in society constrain how the
Net Zero with transition develops.
Constrains The same emission targets as in NZ-Least cost but under the same limitations of renewable energy
(NZ – Constraints) development and solar potential as in the baseline scenario. CCS technologies are allowed. No increased
modal shift is included in the transport sector.

* One scenario only

 Macroeconomics Assumption & Demand projections
Demand projections: Agriculture, Demand projections:
GDP Growth Rate Residential, Service, Industry Transportation
5000
Demand for passenger transport
4000
Average GDP 4000
Period 3000
Growth rate (%)

PJ
2000 3000 Aviation

Bpkm
1000 2000 Navigation
2021-2025 7 0 Rail
1000
2019 2025 2030 2035 2040 2045 2050 Road
2026-2030 7 0
Agriculture Industry (excl.CM,IS) 0 2019 2025 2030 2035 2040 2045 2050

2031-2035 7.5 Residential Service

Demand for freight transport
400 4500
2036-2040 7.5
350 4000
300 3500
2041-2045 7.5 Iron & 3000 Aviation
250 Steel
Mton

2500

Btkm
200 Cement Navigation
2046-2050 7.5 150
2000
Rail
1500
100
1000 Road
50
500
Source: RE 81/2023/QH15 0
0
2019 2025 2030 2035 2040 2045 2050
0 2019 2025 2030 2035 2040 2045 2050

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3.12RESULTS AND DISCUSSION

12
 Total CO2e emissions
600 • It is hard to decarbonize industries
(heavy industries, cement, iron &
500
steel, chemical etc.). After 2040,
400
Upstream industries are the main emission
Mt CO2e

Transport sources.
300
Service • Power generation accounts for the
200 Residential largest share until 2040; after
Power 2040, emission of power sector
100 Industry will be reduced significantly with
Agriculture high penetrations of RE.
-
2025 • Transport sector may reduce its
2030
2019
2025
2030
2035
2040
2045
2050
2019
2025
2030
2035
2040
2045
2050
2019

2035
2040
2045
2050
emission much following Dec. 876.
Baseline Net Zero Least Cost Net Zero with
optimized Constraints
Upstream: fossil fuel extraction and other energy production processes

13
 Total final energy consumption

10000

9000 Other renewables

8000 Synthetic gas

• Significant increases of
Ammonia
7000 electrification in NZ scenarios
6000 Hydrogen (transport, industries, buildings)
5000 Solar • Coal and oil reduce drastically in
PJ

Methanol NZ scenarios
4000
Biomass
• Biomass and biofuels will be
3000
promoted in industries and
2000 Electricity
transport
1000 Heat
• Hydrogen-based fuels play
0 Gas increased role in later years.
2030
2019
2025
2030
2035
2040
2045
2050
2019
2025

2035
2040
2045
2050
2019
2025
2030
2035
2040
2045
2050
Oil

Coal
Baseline NZ-Least Cost NZ-Constraints

14
 Total primary energy supply

12000
Other RE • RE share increase over 40% by 2030

Wind and 80%2050;

10000
• Coal and oil reduce drastically in NZ
Solar scenarios
8000
• Natural gas increases slightly in NZ
Hydro
scenarios
6000
PJ

Waste • Wind energy increases much in NZ

scenarios;
4000 Biomass • Solar energy changes slightly among
the scenarios;
Import
2000 electricity
Gas
0
Oil
2045

2019
2019
2025
2030
2035
2040

2050
2019
2025
2030
2035
2040
2045
2050

2025
2030
2035
2040
2045
2050
Coal
Baseline NZ-Least Cost NZ-Constraints

15
 Carbon capture
35
• CCS does not appear in Baseline
30
Autothermal Reforming • CCS is needed for decarbonizing heavy
CCS (Ammonia) industries:
• Cement: 2040 ~3Mt, 2050 7-9Mt
25 • Iron & steel: 2045 ~5-6Mt, 2050
~18-20Mt
20 Basic oxygen furnace • Ammonia: 2040:
Mt CO2e

CCS (Iron and steel) • In NZ-Least cost, CCS is needed for

capturing CO2 from H2 production by coal
15 gasification (4-5Mt)

10 Clinker capture CCS

(cement)
• CCS may be economic available from 2040
5 onward when CO2 reduction accelerated
for NZE;
• CCS will be preferred in industries to power
0 H2 Production - Coal generation;
2040 2045 2050 2040 2045 2050 Gasification CCS
NZ-Least cost NZ-Constraints centralized

16
 Hydrogen production and use
600

500 • Green hydrogen is

produced mostly by
400 Steam reforming
alkaline electrolysis in
Electrolysis three scenarios.
300
PJ

Alkaline
Coal Gasification • In NZ-Constraint,
CCS
200 hydrogen demand is
Gasesous H2 for
end uses increased much, mainly
100 Green ammonia used in transport sector
synthesis
FT H2 to jet fuel by fuel cell vehicles and
0
producing jet fuel for

2040
2030

2040

2050

2035

2045

2030

2040

2050

2035

2045

2030

2050

2035

2045
aviation.
Baseline NZ-Least NZ- Baseline NZ-Least NZ-
Cost Constraints Cost Constraints
Hydrogen production Hydrogen uses

17
18
INDUSTRY SECTOR

18
Emission in Industrial sector
250
Wood poducts
Textile & Leather
200
Pulp & Paper • Heavy industries are
Others hardest part for
150 Non-metallic decarbonization among
Mt CO2e

Vehicle manufacturing the sectors

Machinery • Cement, iron & steel and
100 Building material
ammonia are main
Iron & Steel
sources for CO2 emission
Food Beverage
50
Mining
Cement
0 Chemical

2040
2019
2025
2030
2035
2040
2045
2050
2019
2025
2030
2035
2040
2045
2050
2019
2025
2030
2035

2045
2050
Ammonia

baseline NZ-Least cost NZ-Constraint

19
 CCS role in Industrial sector emission

250

• CCS technologies play an

200
important role in reducing
150 CO2 emission in two Net-
zero scenarios.
100 • CO2CCS: 57 million tons in
Mt CO2e

2050
50

0
2025
2019

2030
2035
2040
2045
2050

2019
2025
2030
2035
2040
2045
2050

2019
2025
2030
2035
2040
2045
2050
-50
Baseline NZ-least cost NZ- Constraints

-100
CO2CCS IND-Emission IND_CO2 net emssion

20
Cement sector: CO2 emissions
90

80

70

60
IND Cement • Dry process BAT will be main
technology: Dry
50
Mt CO2e

process with CCS technology

40 • Technologies with CCS play
IND Cement
technology: Dry role after 2035, may reduce
30 process BAT
to 7Mt CO2 by 2050
20
IND Cement
technology:
10 Clinker - Existing

0
2025
2019
2025
2030
2035
2040
2045
2050
2019
2025
2030
2035
2040
2045
2050
2019

2030
2035
2040
2045
2050
Baseline NZ-Least Cost NZ-Constraints

21
Iron and steel: CO2 emissions
12

IS Basic Oxigen Furnace

10
with CCS - New
IS Electric Arc Furnace -
8 Existing
IS Scarp Electric Arc Furnace
- Existing
Mt CO2e

6 IS Scrap Electric Arc Furnace • Main sources of emission are

- New scrap electric air furnaces (EAF)
IS Oxygen smelt CCS - New
4 • Technologies with CCS play role
for reducing CO2 after 2035
IS Gas DR Electric Arc
Furnace - New
2
IS Basic Oxigen Furnace -
New
0 IS Basic Oxigen Furnace -
Existing
2050
2019

2030

2040

2025

2035

2045

2019

2030

2040

2050

Baseline NZ-Least Cost NZ-Constraints

22
 Industry fuel consumption
6000

5000

4000 Hydrogen-based
Biomass
Electricity • Energy efficiency should
3000
PJ

Gas come first

2000 LPG • Electrification is main point in
Oil industries
1000 Coke • Biomass has important role
Coal
0
2019
2025
2030
2035
2040
2045
2050
2019
2025
2030
2035
2040
2045
2050
2019
2025
2030
2035
2040
2045
2050
Baseline NZ-Least Cost NZ-Constraints

23
24
BUILDING SECTOR

24
 Residential sector: fuel consumption
900.0

800.0
• Electrification plays
700.0
Renewable LPG
an important role
600.0
Renewable liquid fuels
500.0 Hydrogen
PJ

Solar
400.0
Biomass
300.0 Electricity

200.0 LPG
Oil
100.0
Coal
0.0 2025
2019
2025
2030
2035
2040
2045
2050
2019
2025
2030
2035
2040
2045
2050
2019

2030
2035
2040
2045
2050
Baseline NZ-Least Cost NZ-Constraints

25
 Service sector
300

250 Synthetic natural

gas
Solar

200 Renewable LPG

Oil
150
PJ

LPG • Electrification play

Hydrogen important role
100 • Synthetic fuels may be
Electricity
useful for later periods
Coal
50
Biomass

0
2025
2019
2025
2030
2035
2040
2045
2050
2019
2025
2030
2035
2040
2045
2050
2019

2030
2035
2040
2045
2050
Baseline NZ-Least Cost NZ-Constraints

26
TRANSPORTATION
27
SECTOR

27
 Transport fuel consumption
Hydrogen
3000.0
Electricity

Synthetic NG
2500.0
Renewable • Electricity and methanol are
diesel mainly fuel for transport
2000.0 Renewable jet
fuel demand
Renewable
1500.0 gasoline • In NZ-Constraints, synthetic
PJ

Natural gas
natural gas is used for
1000.0 Methanol (H2) busses while hydrogen is
Ammonia used for aviation purposes
500.0 Jet fuel

Gasoline
0.0
Oil
2045
2019
2025
2030
2035
2040

2050
2019
2025
2030
2035
2040
2045
2050
2019
2025
2030
2035
2040
2045
2050
Baseline NZ-Least Cost NZ-Constraints

28
 Transportation by mode
Road transport: Freight
1200.0
Hydrogen
1000.0
Electricity

800.0
• Efficient vehicles help
Renewable
diesel reduce fuel consumption
600.0 Renewable in freight transport
PJ

gasoline
• Renewable gasoline,
Methanol (H2)
400.0
electricity and then
Gasoline hydrogen are main
200.0
Oil alternative green fuels
0.0
2030

2045
2019
2025

2035
2040
2045
2050
2019
2025
2030
2035
2040

2050
2019
2025
2030
2035
2040
2045
2050
Baseline NZ-Least Cost NZ-Constraints

29
 Transportation by mode
Road transport: Passenger

1000.0

900.0 Hydrogen

800.0 Electricity
700.0 Synthetic NG • Efficient vehicles help
600.0 reduce fuel consumption
Renewable
500.0 in road transport
PJ

diesel
Renewable
400.0
gasoline • Renewable gasoline,
300.0 Methanol (H2) electricity and then
200.0 Gasoline hydrogen are main
100.0 alternative green fuels
Oil
0.0
2040
2019
2025
2030
2035
2040
2045
2050
2019
2025
2030
2035

2045
2050
2019
2025
2030
2035
2040
2045
2050
Baseline NZ-Least Cost NZ-Constraints

30
 Transportation: waterway
600.0
Hydrogen
500.0
Electricity

400.0
Synthetic NG
• Methanol, ammonia and
300.0 Renewable hydrogen are mainly fuel
PJ

diesel in net zero scenarios

Methanol (H2) • Ammonia replacing oil in
200.0
NZ-Constraints due to
Ammonia increased production of
100.0
H2 derivatives
Oil
0.0
2019

2040
2019
2025
2030
2035
2040
2045
2050

2025
2030
2035
2040
2045
2050
2019
2025
2030
2035

2045
2050
Baseline NZ-Least Cost NZ-Constraints

31
 Transportation: aviation
100.0

90.0
Hydrogen
80.0

70.0

60.0 Electricity

50.0
PJ

• Share of Renewable jet

40.0 fuel increase from 2040.
Renewable
jet fuel
Hydrogen and
30.0
electricity start from
20.0 2035
Jet fuel
10.0

0.0
2019
2025
2030
2035
2040
2045
2050
2019
2025
2030
2035
2040
2045
2050
2019
2025
2030
2035
2040
2045
2050
Baseline NZ-Least Cost NZ-Constraints

32
33
4. DISCUSSION

33
Discussion
Pillars for energy transition

Energy efficiency Electrification Renewable energy Hydrogen-based fuels Carbon capture,

utilization and
storage

✓ Development orientations for heavy and energy intensive industries

✓ Roles of energy efficiency in end-use sector

✓ Measures for electrification in building sectors

✓ Green fuel for transport sector

✓ Biofuels in industries and transport

✓ Development of hydrogen and its derivatives

✓ Application of CCUS technologies

34
Next steps

— Review of feasibilities of new

technologies
— Review costs of new technologies,
any localized values needed
— Review and checking model linking
for consistent results

35
 THANKS FOR YOUR
36
PARTICIPATION!

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