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What is LNG electrification? Prospects of LNG electrification in Vietnam

Updated: Oct 20, 2023

LNG (Liquefied Natural Gas) is a type of natural gas that has been liquefied at a very low temperature after removing impurities. Currently, LNG is widely traded in the international market and serves as an important source of energy for many countries worldwide. It primarily consists of Methane gas (CH4) with a composition of 94.3%. LNG is colorless, odorless, non-toxic, and is cooled to a very low temperature. Once liquefied, LNG has a storage capacity 2.4 times higher than CNG.

LNG is a safe and environmentally friendly gas that is easy to transport and has high economic efficiency. Currently, LNG is widely traded in the global market and has become an important source of energy for many countries such as Japan, China, South Korea, Taiwan, European countries, and North America. Among them, Australia, Qatar, the United States, and Russia are the largest LNG exporters in the world, while countries in Northeast Asia like Japan, China, and South Korea are the largest importers and consumers of LNG. For example, Japan's annual consumption reaches approximately 100 million tons. In Vietnam, LNG is mainly used for industrial boilers, liquid phase drying machines, rotary kilns, furnaces, and various industries including milk production, manufacturing, food processing, construction, and also as a substitute for gas in restaurants.

Prospects for LNG power generation in Vietnam:

1, Benefiting from Power Plan VIII

Power Plan VIII prioritizes reducing the proportion of coal-fired thermal electricity and developing imported LNG power sources on an appropriate scale. Currently, Vietnam's total gas power plant capacity is around 9 kW, and this number is expected to increase more than fourfold to approximately 37 kW by 2030, with 15 kW utilizing domestic gas sources and 22 kW relying on imported LNG. Therefore, the proportion of gas power sources in the total national electricity capacity will double from the current 13% to reach 25% by 2030. LNG power plants are expected to develop in the period of 2021 - 2030 such as Nhon Trach 3 and 4 Power Plants, Nghi Son LNG, Bac Lieu LNG, Son My II LNG, ... will be built and put into operation, contributing to increasing the country's electricity supply.

2, Vietnam-US Trade Cooperation

Energy transition, environmental protection, and sustainable development have become major trends for cooperation and development. Enhancing cooperation with the United States in this field will contribute to Vietnam's construction and investment in a more efficient national energy system, while also creating opportunities to attract direct investment flow and advanced technology into this sector in Vietnam. This is also an opportunity for Vietnam to import LNG from one of the top three LNG-exporting countries in the world (the US accounts for 12.6% of LNG export market share, equivalent to 44.8 million tons).

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