Dr. Vo Tri Thanh: Electric vehicles are not the only solution for energy security

Electric vehicle conversion is a central issue in energy transition and green growth. This transition is receiving more attention these days, when the military conflict in the Middle East has a strong impact on the global energy market.

Share at the discussion “Electric vehicles: Solution to the “problem” of energy and sustainable development” Organized by the Industry and Trade Newspaper on March 20, Dr. Vo Tri Thanh, Director of the Institute for Brand Strategy and Competitiveness Research, commented that this type of vehicle makes a positive contribution. However, the issue of energy security needs to be viewed more comprehensively.

Mr. Thanh said energy security needs to be associated with three factors: sufficient, stable and sustainable primary (gasoline, oil, coal) and secondary (electricity) energy sources. Switching to electric vehicles reduces gasoline and oil consumption, but increases secondary energy. That is, to be accurate, this conversion needs to include the need for technology and the cost of the primary energy complex needed to produce charging electricity.

Besides, the emissions of electric vehicles are closely linked to the power source. This type of vehicle will contribute to reducing emissions if the power source used is clean energy. On the contrary, if electricity is still produced from coal, oil and gas, using electric vehicles is basically just “transferring emissions from one area to another”.

“Electric vehicles have a certain contribution, but are not the only solution for energy security,” Mr. Thanh said. This problem needs to be approached holistically, linked to the entire energy system and sustainable development goals.

Regarding electric vehicles specifically, Mr. Thanh recommended that this industry needs to be viewed more broadly than a single electric car industry. This is a comprehensive field that requires many different technologies, techniques and production processes, and can be seen as a symbol reflecting the level of technological development of a country. For Vietnam, this field is important in technological autonomy, including many core technologies such as materials, precision mechanics, battery technology, and waste treatment after the production and consumption cycle.

Agreeing with the above opinion, Mr. Pham Van Quan, Deputy Director of the Department of Industry (Ministry of Industry and Trade), said that from the Ministry’s perspective, electric vehicles are not simply a means or equipment, but a new industry. Therefore, it is necessary to synchronously prepare infrastructure, legal corridors and institutions to be able to operate and develop this industry effectively.

This industry has also had certain achievements. In terms of localization rate, according to the Ministry of Industry and Trade, this rate at VinFast will reach about 60%, by 2025. In the coming time, if the battery factory in Ha Tinh is completed and put into operation, the above rate can increase to about 80%. Mr. Quan also pointed out the fact that some FDI enterprises in the automobile sector only localize 10-15% of many car models, not reaching 40% as committed.

In the field of storage batteries, VinFast is currently also implementing new investment projects, expected to increase the localization rate to 80-90%. “In terms of technological capacity, it can be affirmed that Vietnam has gradually mastered core technologies such as engines and batteries – the most important components of electric vehicles,” Mr. Quan said.

Regarding used electric vehicle batteries, the Deputy Director of the Department of Industry said this type of battery has high durability, with a life cycle of about 10-20 years. When the battery capacity is reduced to about 70%, it can be replaced with a new battery, while the old battery continues to be used for energy storage purposes (BESS). Thus, the overall life cycle of the battery can last up to about 40 years. However, Mr. Quan proposed that recycling regulations need to be developed right at this time, because the electric vehicle industry is developing rapidly.

In addition, the Ministry of Industry and Trade identified technologies related to renewable energy and storage batteries as strategic technologies that need to be prioritized for development in the coming period. On that basis, preferential policies are also being completed in the direction of promoting the formation and development of domestic supply chains.

One of the notable criteria is that FDI enterprises that want to enjoy incentives in the field of supporting industries must have the participation of at least one Vietnamese enterprise in the supply chain. At the same time, products eligible for incentives must have a certain scientific and technological content, instead of just simply assembling.

This Ministry is building a system of standards and regulations related to pillar equipment, charging stations and rechargeable batteries. By the end of 2025, the joint ministries of Industry and Trade and Science & Technology have developed 18 standards and regulations. Recently, the Prime Minister requested the Ministry to complete this entire legal system by the third quarter.