In the dark: Drivers and motorcyclists moving through a street during a blackout in Hanoi. — AP
An intensely hot summer and unprecedented drought are straining energy supplies in northern Vietnam, prompting rolling blackouts and sudden power outages that have led to “uncountable” losses among local firms and foreign manufacturers.
Vietnam is a crucial part of the supply chain for some of the world’s most important companies, and many of them – including Samsung and Apple supplier Foxconn – have factories in the north, not far from the capital Hanoi.
Operations at a large number of factories have been badly impacted by the lengthy power outages, business leaders said. Some were given very little notice or had no warning at all.
“We had a 26-hour power cut. It cost us tens of thousands of dollars that day. It’s not nice at all,” said Vu Chi Hieu, director of Vietnam’s KingBill XNK Joint Stock Company that produces aluminium parts in Bac Ninh province, which neighbours Hanoi.
Last week, several northern areas – many of them home to key industrial parks – were told to cut their energy use in half, forcing the Japanese, Korean and European chambers of commerce to petition the government to find a quick solution to the crisis.
Susumu Yoshida from Japan Chamber of Commerce and Industry said that direct damage from one single power outage affecting five manufacturers was over US$190,000.
“Total damage among IPs (industrial parks) in northern Vietnam seems to be an unaccountable amount,” he said.
The South-East Asian nation has struggled with a series of heatwaves since early May when the mercury reached a record high, while rivers and reservoirs at hydroelectric power plants have dried up.
Vietnam relies on hydropower for almost half its energy needs but 11 big plants in the north and central regions have had their power generation severely interrupted in recent weeks.
Two out of three units at one of the biggest in Vietnam, Thac Ba, have stopped functioning.
At the same time, as the use of air conditioners and electric fans surged, there has been “a 20% increase in demand on the network”, National Load Dispatch Centre deputy director Nguyen Quoc Trung said.
“The power shortage has been and will be intense in the north, until early July,” Trung warned at a roundtable discussion in Hanoi late last week.
Trung’s boss, Nguyen Duc Ninh, was suspended on Wednesday pending an investigation into the outages.
A recent government target to reduce energy consumption by two percent per year until 2025 suggests the issue may persist. — AFP
