Global turbine crunch threatens Vietnam and Philippines gas power

The shortage is seen to delay projects in the said countries.

The global shortage of gas turbines is projected to delay and fuel costs for new gas-fired energy projects in Vietnam and the Philippines, according to a new Institute for Energy Economics and Financial Analysis (IEEFA) report.

“Turbine backlogs add to an already lengthy list of regulatory and financial challenges delaying gas-to-power projects in Vietnam and the Philippines,” said Sam Reynolds, author of the report and an LNG/Gas research lead for IEEFA Asia.

“Meanwhile, the rapid expansion of low-cost renewables and storage could ultimately limit the long-term role for gas and liquefied natural gas (LNG).

The IEEFA report noted that the Philippines is unlikely to bring any new LNG-fired power plants online this decade. Although one project in Batangas is set to begin fully operating this year, the country’s other proposed projects, totaling 10.7 gigawatts (GW) of capacity, remain in early development stages and are unlikely to have secured gas turbine orders.

Meanwhile, Vietnam is likely to miss its 2030 targets for domestic gas and LNG-fired power capacity by a combined 25.2 GW. By 2030, the country aims to have 22.5 GW of LNG-fired power capacity and 14.9 GW run on domestically produced gas, up from 1.6 GW and 8.3 GW, respectively.

Reynolds noted existing in both countries have relied exclusively on turbines from GE Vernova, Siemens Energy, and Mitsubishi Heavy Industries, the largest manufacturers that together account for roughly 90% of heavy-duty gas turbine orders since 2015.

“A spike in turbine orders from the US and the Middle East, combined with supply chain constraints for turbine manufacturing, has created a global shortfall,” he said.

Approximately 80 GW of turbine orders were placed in 2024, compared to an estimated production capacity amongst the three largest manufacturers of 30 GW. Annual orders are expected to surpass 100 GW starting in 2027.

“Gas turbine shortages make the case for renewable energy in Vietnam and the Philippines even clearer,” said Reynolds. “Every year of delays for gas and LNG-fired power plants means that less gas and LNG will be needed in the long run.”