Vietnam’s northern province of Bac Giang, home to suppliers Apple Inc., Samsung Electronics Co. and other countries, it is struggling to keep factories running as blackouts sweep across the country.
Energy consumption in the north of Vietnam may continue due to high temperatures and low rainfall, especially in Vietnam which relies heavily on hydroelectric power. Hydro (large and small) will account for nearly 30% of the country’s energy in 2021, second only to coal. However, low water levels in reservoirs during droughts can reduce water output. In early June, six hydroelectric stations they stopped making electricityaccording to data from the Vietnam Electricity Group.
Extreme weather events put companies around the world at risk after boosting their presence in Vietnam as an alternative supply chain during the US-China war. The northern province of Bac Giang has seen an increase in foreign investment this year, especially from various countries exporting their products from China to Vietnam. This economic upswing is counter to the downsizing of the climate.
Among the suppliers Bac Giang owns is Quanta Computer Inc., Apple’s main contract manufacturer of MacBooks, and AirPods maker GoerTek Inc., which has established a manufacturing base to reduce Apple’s disruption. Other Apple distributors in the region include Hon Hai Precision Co. and Luxshare Precision Co.
However, the recent power outages hit the factories as high temperature conducts electricity. In June, authorities in Bac Giang ordered factories to move some products until 10 p.m.
Separately, the Vietnamese government has asked coal miners and the Vietnam Oil and Gas group to work make sure the lights have enough oil. Meanwhile, Prime Minister Pham Minh Chinh also asked the government to discuss the purchase price of wind and electricity projects that are ready to connect to the national grid.
Use the Bloomberg ECST, MAP, SPLC, WFOR and BNEF tools to assess the impact of unusual weather conditions. Run BNEF to Analyze Vietnam’s Power Generation Sources.
For more information on this or other services on the Bloomberg Professional Service, click here to request a demo with a Bloomberg sales representative. Existing customers can print