socialist republic of vietnam - the pmr · 2014. 10. 13. · strategy (ggs). the ggs adopted in...
TRANSCRIPT
SOCIALIST REPUBLIC OF VIETNAM
PARTNERSHIP FOR MARKET READINESS (PMR)
PREPARED BY: Ministry of Natural Resources and Environment (MONRE)
Ministry of Planning and Investment (MPI) Ministry of Industry and Trade (MOIT)
Ministry of Construction (MOC)
MARKET READINESS PROPOSAL (MRP) Version October 10, 2014
2
TABLE OF CONTENTS Abbreviations and Acronyms ................................................................................. 4
1. Country Context .................................................................................................... 12
2. Historic and Projected GHG Emissions ................................................................... 15
2.1. Historic GHG Emissions .............................................................................................. 15
2.2. GHG Emission Projections .......................................................................................... 17
3. GHG Pledges of Vietnam ....................................................................................... 19
4. Climate Change Policies ......................................................................................... 19
5. Vietnamese Carbon Market Experience ................................................................. 22
5.1. CDM .......................................................................................................................... 22
5.2. NAMAs/JCM .............................................................................................................. 23
1. Policy Mapping and Gap Analysis .......................................................................... 27
1.1. Key Elements of Vietnams Energy Policy ..................................................................... 27
1.2. Reliance on Fossil Fuels .............................................................................................. 28
1.3. Liberalization Process and Fossil Fuel Price Controls ................................................... 29
1.4. Gaps in Monitoring and Enforcement of Energy Conservation and Efficiency Policy ..... 31
1.5. Implications for MBI Design and Implementation ....................................................... 32
1.6. Identification of Policy Objectives and Criteria to Guide Elaboration of MBIs ............... 33
1.7. Abatement Cost Curves in Vietnam: Some Preliminary Results ................................... 37
2. Sector Selection .................................................................................................... 40
3. Organizational Setup ............................................................................................. 40
BUILDING BLOCK 3 .................................................................................................... 45
1. Target/Goal Setting and Relation to MBIs ........................................................... 45
2. MRV and Data Approaches ................................................................................. 47
2.1. Overview ................................................................................................................... 47
2.2. Top-down MRV Approaches ....................................................................................... 47
2.3. Bottom-Up MRV Experience ....................................................................................... 49
2.4. Conclusion on MRV .................................................................................................... 51
3. Registry/Tracking Tool and Anticipating Linking ..................................................... 51
4. Objectives, Activities, and Proposed Budget (Component 1) .................................. 52
BUILDING BLOCK 4A .................................................................................................. 45
1. Overview of the Sector .......................................................................................... 57
1.1. Current Status ........................................................................................................... 57
3
1.2. Output Projections .................................................................................................... 60
1.3. GHG Emissions ........................................................................................................... 60
1.4. Rationale for Sector Focus .......................................................................................... 62
2. Designing the Crediting Programme for the Steel Sector ........................................ 63
2.1. Data Management and MRV ...................................................................................... 63
2.2. Baseline Setting ......................................................................................................... 64
2.3 Abatement Options and Mitigation Goals .................................................................... 67
3.MBI for the Steel Sector ......................................................................................... 69
3.1. SWOT Analysis ........................................................................................................... 69
3.2. Roadmap Concerning MBIs for the Steel Sector .......................................................... 70
3.3. Institutional and Legal Arrangements ......................................................................... 71
3.4. Objectives, Activities, and Proposed Budget (Sub-Component 2.1) .............................. 72
BUILDING BLOCK 4B .................................................................................................. 45
1. Overview of the Sector .......................................................................................... 78
1.1. Current Status ........................................................................................................... 78
1.2. Output Projections .................................................................................................... 81
1.3 GHG Emissions ............................................................................................................ 82
1.4. Organization of the Solid Waste Management Sector ................................................. 84
1.5. Institutional and Legal Arrangements ......................................................................... 85
1.6. Solid Waste Sector Experience with MBIs ................................................................... 87
1.7. Rationale for Sector Focus .......................................................................................... 90
2. Designing the Crediting Programme for the Solid Waste Sector ............................. 92
2.1. Scope and Coverage ................................................................................................... 92
2.2. Baseline ..................................................................................................................... 93
2.3. MRV Structure ........................................................................................................... 94
2.4. SWOT Analysis ........................................................................................................... 94
2.5. Institutional Arrangement .......................................................................................... 96
2.6. Analysis of Other Market-Related Carbon Pricing Instruments .................................... 96
2.7. Objectives, Activities, and Proposed Budget (Sub-Component 2.2) .............................. 96
BUILDING BLOCK 5 .................................................................................................... 98
1. Organizational Setup ........................................................................................... 101
2. Stakeholder Engagement .................................................................................... 104
3. Objectives, Activities and Proposed Budget (Component 3) ................................. 105
Annex 1: Activities, Outputs, Timelines and Budget PMR ........................................ 109
Annex 2: List of Contacts and Meetings in Vietnam ................................................. 116
BIBLIOGRAPHY AND REFERENCES ............................................................................ 132
4
Abbreviations and Acronyms
ADB Asian Development Bank
AFD Agence Française de Développement
BAU Business-as-usual
BB Building Block
BF Blast furnace
BFG blast furnace gas
BOF Basic oxygen furnace
BOT Build-Operate-Transfer
BTO Build-Transfer-Operate
BTU British Thermal Unit
BUR Biennial update report
CAPEX Costs include capital expenditures
CC Climate Change
CDM Clean Development Mechanism
CER Certified Emission Reduction
CIEM Central Institute for Economic Management
CITENCO Ho Chi Minh City Environmental Company
COG coke oven gas
COP Conferences of the Parties
DMHCC Department of Hydrology Meteorology and Climate Change (DNA under CDM framework)
DNA Designated National Authority
DOC Departments of Construction
DOCf Fraction of degradable organic carbon dissimilated
DOE Designated Operational Entities
DSENRE Department for Science, Education, Natural Resources and Environment (MPI)
DSM Demand Side Management
DSTE Department of Science Technology and Environment under MOC
EAF Electric Arc Furnace
EBT Eccentric Bottom Tapping
EBT Eccentric Bottom Tapping
EE Energy Efficiency
EEC Energy Efficiency and Conservation
ENERTEAM Energy Conservation Research and Development Centre
EOI Expression of Interest
5
ETS Emission Trading system
EU ETS European Union Emissions Trading Scheme
FIRM Facilitating Implementation and Readiness for Mitigation
FOD First Order Decay
FUCHS Scrap Preheating
FUELEX fuel expenses
GDP Gross Domestic Product
GGS Green Growth Strategy
GHG Greenhouse Gas
GI Green Industry
GITF Green Industry Task Force
GIZ Deutsche Gesellschaft für Internationale Zusammenarbeit
GJ/t Gigajoule per ton
GoV Government of Vietnam
Ha Hectare
HCMC Ho Chi Minh City
ICD International Cooperation Department
IDD Investment Decision Document
IEVN Institute of Energy Vietnam
IMHEN Vietnam Institute of Meteorology, Hydrology and Environment
INC Incorporation
INEST Institute for Environmental Science and Technology
IPCC Intergovernmental Panel on Climate Change
IRRCs Integrated Resource Recovery Centres
ISEA Industrial Safety Techniques and Environment Agency under MOIT
ISO International Organization for Standardization
ISPONRE Institute of Strategy and Policy on Natural Resources and Environment
JCM Joint Crediting Mechanism
JICA Japan International Cooperation Agency
JSC Joint Stock Company
KTOE Kiloton of Oil Equivalent
LCO Low Carbon Option
LEED Leadership in Energy and Environmental Design
LEMNA LEMNA International Inc.
LULUCF Land Use, Land- Use Change and Forestry
MAC marginal abatement cost
MARD Ministry of Agriculture and Rural Development
MBI market-based instruments
MCF Methane correction factor
MOC Ministry of Construction
MOEJ Ministry of the Environment of Japan
6
MOET Ministry of Education and Training
MOF Ministry of Finance
MOIT Ministry of Industry and Trade
MONRE Ministry of Natural Resources and Environment
MOST Ministry of Science and Technology
MOT Ministry of Transport
MPI Ministry of Planning and Investment
MRP Market Readiness Proposal
MRV Monitoring, Reporting, and Verification
MSW Municipal solid Waste
N/A Not applicant
NAMA Nationally Appropriate Mitigation Actions
NCCC National Committee on Climate Change
NDF Nordic Development Fund
NGO Non-Governmental Organization
NIES National Institute for Environmental Studies
NMMs New Market Mechanisms
NOAK Nordic Group on Climate Change
NTP National Target Programme
NTP-RCC National Target Program to Respond to Climate Change
ODA Official Development Assistance
OECC Overseas Environmental Cooperation Centre of Japan
OF Organizing Framework
OMEX operating and maintenance expenditures
PCI Pulverized Coal Injection
PDP Power Sector Development plan
PES Payment for Ecosystem Services
PM Prime Minister
PMO Prime Minister Office
PMR Partnership for Market Readiness
PMU Project Management Unit
PoAs Program of Activities
PPC Provincial People's Committees
QA/QC Quality Assurance/Quality Control
RCEE RCEE-NIRAS Joint Stock Company
RE Renewable Energy
SC Strip Casting
SD Sustainable Development
SE South East
SEC Specific Energy Consumption
SNC Second National Communication
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SOE State-owned Enterprise
SSP Small Steel Producer
SW Solid Waste
SWM Solid Waste Management
TSC Thin Slab Casting
UN United Nation
UNDP United nations Development Program
UNEP United Nations Environment Program
UNESCAP United Nations Economic and Social Commission for Asia and the Pacific
UNFCCC United Nations Framework Convention on Climate Change
UNIDO United Nations Industrial Development Organization
URENCO Urban Environment Company Ltd.
US EIA United States Energy Information Administration
USA United States of America
USD United States Dollar
VCS Verified Carbon Standard
VEA Vietnam Environment Administration
VGBC Vietnam Green Building Council
VNEEP Vietnam National Energy Efficiency Program
VSA Vietnam Steel Association
WG Working Group
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PMR Contact Point
Name Truong Duc Tri
Organization Department of Meteorology, Hydrology and Climate Change
Title Deputy Director General
Address Floor 3 rd, No.10 Ton That Thuyet St., Hanoi, Vietnam
Telephone +84 903207999
Fax +84 4 37759 770
Email [email protected]
Website www.dmhcc.gov.vn
PMR Development Team
Name Organization
1. Madame Tran Minh Ha Ministry of Natural Resources and Environment (MONRE)
2, Mr. Nguyen Tuan Anh Ministry of Planning and Investment (MPI)
3. Mr. Pham Van Tan Ministry of Natural Resources and Environment (MONRE)
4. Dr. Luong Quang Huy Ministry of Natural Resources and Environment (MONRE)
5. Dr. Le Minh Nhat Ministry of Natural Resources and Environment (MONRE)
6. Ms. Luu Linh Huong Ministry of Construction (MOC)
7. Mr. Hoang Van Tam Ministry of Industry and Trade (MOIT)
8. Ms. Pham Thi Tra My Ministry of Natural Resources and Environment (MONRE)
9. Mr. Nguyen Khanh Toan Ministry of Natural Resources and Environment (MONRE)
10. Ms. Nguyen Thi Minh Nguyet Ministry of Natural Resources and Environment (MONRE)
GENERAL INFORMATION
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1. Vietnam has experienced strong growth and correspondingly increasing energy consumption
and GHG emissions. The two core bottlenecks for the development of market-based
instruments in Vietnam are the additional reform of the state-owned sectors and the
introduction of regulatory incentives and pricing instruments that effectively allocate resources.
2. Over the last decade, Vietnam accounted for the fastest growth in GHG emissions in the
region. Both Vietnam’s total emissions and per capita emissions almost tripled in the ten year
period while the carbon intensity of GDP increased by 48%. Depending on the scenario and core
assumptions Business as Usual (BAU) GHG emissions of Vietnam are projected to increase by
factor 5-7 by the year 2030 compared to 2010 resulting in emissions of around 500-700 MtCO2
by 2030.
3. Vietnam has various climate policies in place of which the most concrete is the Green Growth
Strategy (GGS). The GGS adopted in 2012 has as overall objective to achieve a low carbon
economy and includes various intensity targets (GHG in relation to GDP) and targets in relation
to BAU for the time period 2020, 2030 and 2050.
4. More than 250 Clean Development Mechanism (CDM) projects in Vietnam have been
registered of which the overwhelming majority is from the energy sector. Vietnam is the country
with the 4th largest portfolio of CDM projects worldwide. However most of the projects were
registered relatively late which resulted in a limited financial impact of the CDM on Vietnam.
5. Vietnam has comparatively little experience with MBIs in environmental policy and more
specifically within climate policy. In developing new MBIs, capacity must be built not only in
relation to the core issues of management of the instrument, but also in relation to the enabling
factors, such as wider stakeholder awareness of the functioning of MBIs and the development of
a constituency of actors that support actively the development of MBIs.
6. Vietnam presented October 2011 its Expression of Interest and May 2012 the Organizing
Framework (OF) for PMR activities. In it’s OF, the GoV indicated interest in the steel, solid waste
management, energy efficiency in building and transport sector.
7. One of the important MBIs, which Vietnam has identified its carbon pricing. Within this area a
clear gap exists in assessing the viability, the principles and elements of a carbon pricing
instrument. For the fossil fuel pricing reform it is considered as important to review and
consider implementation barriers posed by existing fossil fuel pricing structure to the
development of full cost recovery and the use of MBIs. Activities in this area are partially already
been undertaken but are complemented by the PMR.
8. Various NAMAs are currently under preparation or planning in Vietnam in the waste, steel,
cement, chemical fertilizer, wind power and biogas area in Vietnam. Also JICA, UNDP and GIZ
SUMMARY
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support various NAMA readiness support programs basically in the area of MRV and general
capacity building. Gaps exist in the institutional structure (including a data collection platform
and management system), and in registry. The PMR will work on closing these gaps.
9. The PMR will focus on three complementary components that will work towards developing
the Government’s core technical, policy, institutional and regulatory market readiness to reduce
GHG emissions in the country. This will be conducted through essential capacity development
and improved data management at the central level, sustained stakeholder engagement to
ensure efficient and effective leadership and implementation, and the design and preparation of
selected elements of MBIs in selected sectors to inform future carbon pricing approaches. The
efforts towards preparing for and designing sector-specific MBIs in this project (Component 2)
will work in parallel with the development of policy and management tools for carbon pricing
readiness, (Component 1), both of which will prioritize “no-regret measures” that would be
beneficial irrespective of future policy decisions and of the evolution of international climate
negotiations.
10. In Component 1 (Strengthening capacity for developing carbon pricing approaches,
including through supporting priority building blocks for MBIs) the GoV will facilitate future
development of carbon pricing policy approaches, including MBIs through a focus on evaluating
carbon pricing options for Vietnam and assessing and developing the technical, policy and
management tools available to the GoV for MBI implementation. The component will include
support targeted at assessing the overall institutional, policy, and technical gaps and
opportunities for designing and implementing carbon pricing approaches and assessing and
developing technical, policy and management tools to guide the implementation of MBIs in
Vietnam.
11. In component 2 (Readiness to pilot selected market-based instruments), the GoV will
develop core elements of the selected MBIs such as the MRV system focusing on the steel and
solid waste sectors and clearly focusing on complimentary elements to activities undertaken by
NAMAs within the same sector. The steel sector was selected due to its high energy
consumption and the feasibility of implementation, noting the concentrated nature of the
sector as there are a limited amount of facilities in Vietnam. The sector also has significant
identified abatement options and has been identified by the Government as a priority sector for
GHG reduction measures. The solid waste sector also provides an opportunity to design and
plan for the testing of MBIs in a sector with rapidly growing emissions. The sector’s experience
with several registered CDM projects and the two NAMAs currently under development also
illustrate its potential for implementing project or sector-based MBIs. The data management
and reporting for both sectors will be developed by the line ministries (MOIT and MOC for steel
and solid waste sectors, respectively), in consultation with MONRE, as the focal point on NAMAs
of the Government. The policies developed as part of Component 1 for data management will
help ensure all the relevant data are collected, reported, and archived properly in a systematic
and consistent way to facilitate the integration of data into sectoral and national MRV systems.
11
12. In component 3 (Program management and stakeholder engagement facilitation) the PMR
will support MONRE (as chair of the PMR Steering Committee) to guide the implementation of
the proposed activities and other MBI-related activities in Vietnam. This component would also
support enhanced stakeholder engagement and communication efforts, including the reporting
of PMR project implementation progress to the NCCC.
13. In order to implement the market readiness proposal in the next phase, a PMR Steering
Committee will be established under the chair of MONRE. The PMU will be set up by the DMHCC
- an agency of MONRE. DMHCC will appoint a project director and a project manager for the
overall organization, management, daily operation as well as for the coordination with all
relevant stakeholders, Ministries and agencies. On the sector level two working groups will be
implementing the PMR program in Vietnam. The working groups are chaired by the line
ministries MOIT for the steel sector and MOC for the solid waste management sector.
14. A key element for a positive outcome of the proposed activities will be the integration of the
stakeholders of the selected sectors. Therefore the PMU will organize workshops for relevant
stakeholders and will organize regular consultation events and seminars.
15. The total budget required for all proposed activities under the PMR is estimated at US$ 3.6
million. Vietnam requests the Partnership Assembly to grant US$ 3.0 million for the proposed
activities. The remaining budget of US$ 0.60 million will be funded by the Vietnamese
Government and other sources of funds. The summary of schedule and budget for each area is
shown in the following table.
Area Year 1 Year 2 Year 3 Total PMR GoV/ others
Component 1 350,000 650,000 350,000 1,350,000 1,100,000 250,000
Component 2 550,000 500,000 750,000 1,800,000 1,520,000 280,000
Component 3 150,000 150,000 150,000 450,000 380,000 70,000
Total 1,050,000 1,300,000 1,250,000 3,600,000 3,000,000 600,000
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1. Country Context The economic performance of Vietnam of the last 20 years has been impressive. Between 1990
and 2010, the Vietnamese economy has grown at an annual average rate of 7.3 percent, and the
per capita income almost quintupled, while poverty rates have been dramatically reduced (see
the following Figures).
Vietnam’s transition from a centrally planned economy to a market economy has to date been a
success story. Yet, as recent research and the last few years indicate, this growth model is facing
new challenges. Vietnam’s economy is experiencing its longest spell of slow growth since the
onset of economic reforms in the late-1980s. Real GDP grew by 5 percent in 2012, the lowest
level since 1998 and is expected to grow in 2013 at a similar rate1. Vietnam is also experiencing
declining investment ratios in domestic non-state, foreign as well as in the state domestic
sector2. In the 1990s, most growth came from increased factor productivity; instead, over the
last decade, factor productivity has increased at a slower pace. Over the last few years,
economic growth has been achieved at the expense of factor accumulation, i.e. increased use of
physical and human capital. These capital pools are however limited, implying a longer-term
problem for the Vietnamese economy.
1 World Bank, Taking Stock: An Update on Vietnams Recent Economic Developments, 07/2013
2 World Bank, Taking Stock: An Update on Vietnams Recent Economic Developments, 07/2013, Figure 8
BUILDING BLOCK 1: THE BIG PICTURE - POLICY CONTEXT
1. Country Context
2. Historic and Projected GHG Emissions
3. GHG Pledges of Vietnam
4. Climate Change Policies
5. Carbon Market Experience
13
Figure 1: GDP Growth Rates (annual %)
Source: World Bank, Vietnam 2030, charting a Low Carbon Development Path for Vietnam, Draft report, 2014
Figure 2: GDP per Capita and Poverty Rates
Source: World Bank and GSO, quoted in World Bank (2012) Well Begun, Not Yet Done: Vietnam’s Remarkable Progress on Poverty Reduction and the Emerging Challenges
Without accelerating structural reforms, especially in the banking and state-owned enterprise
(SOE) sectors, the World Bank assumes that Vietnam faces the risk of a prolonged period of slow
growth3. Despite major reforms in the 1980s and 1990s, in which centralized planning was
foregone and SOEs were allowed increased management autonomy; these nevertheless lack in
many cases adequate regulatory structures. While these companies have a disproportionate
3 Same source, p.15 and World Bank (2011) Vietnam Development Report: Market Economy for a Middle-Income
Vietnam, Joint Donor Report to the Consultative Group Meeting
14
share of the country’s capital and land, they underperform in relation to their effective use.
Whereas their overall weight on the economy has receded, some key sectors are still controlled
by SOEs; including some of the key sectors in which this report will argue for market-based
climate policy instruments (see following Figure).
Figure 3: SOE Shares of Revenue/Output of Key Economic Sectors
Source: World Bank (2012) Vietnam Development Report: Market Economy for a Middle-Income Vietnam, Joint Donor Report to the Consultative Group Meeting
Along the incomplete reform of the state-owned sectors including energy, Vietnam also faces a
challenge in the introduction of regulatory incentives and pricing instruments that effectively
allocate resources. A case in point is the energy sector, in which there is a prevalence of energy
subsidies. Fossil fuel subsidies in Vietnam are among the highest in South Asian economies;
electricity prices are capped and differentiated for different users, domestic coal prices are set
below world market prices in order to enable cheap electricity production and manufacturing
and there are also price ceilings in the refined petroleum markets along with various taxes and
tax waivers4. In short, the prevalence of price distortions in energy markets implies a more
difficult penetration of MBIs for climate policy.
The energy intensity in terms of BTU per USD doubled in the period 1980 to 20105. The ratio is
also higher than in other SE Asian economies - in this context, Vietnam could be seen as a
“brown” economy for the present time6. The energy elasticity factor for the period 2005-2008 is
1.15 and the electricity elasticity factor is 1.77 which means that energy and especially electricity
consumption have increased at a faster rate than GDP. Vietnam is since 2011 again a net 4 UNDP, Fossil Fuel Policies and GHG Emissions in Vietnam, 2012, p.1
5 US EIA, http://www.eia.gov/countries/country-data.cfm?fips=VM#pet
6 CIEM, Macroeconomic Assessment for Low Carbon Options in Vietnam, 1
st draft report, 07/2013, p.6
7 MPI/UNDP, A Marginal Abatement Cost Curve Analysis for the Energy Sector in Vietnam, Table 1, 2013, p.18; energy
elasticity refers to energy consumption increase relative to GDP i.e. an increase of 1% of GDP resulted in an increase of 1.18% of energy usage. The electricity elasticity factor is defined idem i.e. 1% increase of GDP resulted in an increase of 1.7% of electricity usage.
15
importer of petroleum products whilst exporting coal8. Looking ahead to the medium term,
three areas are essential for development of the power sector in Vietnam: (i) sector reform and
market development, (ii) meeting demand with reliable supply in environment friendly manner,
and (iii) promoting Energy Efficiency and Conservation (EEC) and Renewable Energy (RE)9.
In summary, Vietnam has experienced strong growth and correspondingly increasing energy
consumption and GHG emissions. The two core bottlenecks for the development of market-
based instruments in Vietnam are the additional reform of the state-owned sectors and the
introduction of regulatory incentives and pricing instruments that effectively allocate resources.
2. Historic and Projected GHG Emissions
2.1. Historic GHG Emissions The most recent GHG data is from the 2005 National GHG Inventory Report (DMHCC and JICA,
07/2013) realized under the framework of the project “Enhancing Capacity on GHG Inventory of
Vietnam” supported by JICA. This data, used in the following section, is still under validation and
not yet official. Therefore the data used is for reference only. GHG emissions excluding LULUCF
in 2005 were around 205 MtCO2e. The following Table shows 2005 emissions.
Table 1: Summary of Vietnam National Inventory 2005 (unit: MtCO2e)
Sector CO2 CH4 N2O Total
Energy of which manufacturing industry & construction of which iron and steel
82.86 23.99 0.99
18.82 0.04
0
0.27 0.09
0
101.94 24.11 0.99
Industrial processes of which metal production
14.59 0.88
0 0
0 0
14.59 0.88
Agriculture 0 51.16 29.43 80.58
Land-Use Categories -49.85 0.08 0.02 -49.75
Waste of which solid waste disposal
0.01 0
6.41 2.30
1.69 0
8.12 2.30
Total Emissions excl. LULUCF 97.46 76.39 31.39 205.24
Total Emissions incl. LULUCF 47.60 76.47 31.41 155.48
Source: DMHCC and JICA, 2005 National GHG Inventory Report, 07/2013, Table 1, 2, 4, 5, 6, 7 (not official, provisional data)
Over the last decade, Vietnam accounted for the fastest growth in GHG emissions in the region.
Both Vietnam’s total emissions and per capita emissions almost tripled in the ten year period
8 US EIA, http://www.eia.gov/countries/country-data.cfm?fips=VM#pet
9 ADB. Energy Sector Assessment Strategy and Roadmap Vietnam 2010, 05/2010, p.14
16
while the carbon intensity of GDP increased by 48%10. Of particular importance is the increasing
trend in carbon intensity of Vietnam’s GDP, which is now the second highest in the region after
China. While Vietnam started the decade from a relatively low base, at current rates of growth,
it will soon become one of the major emitters of GHG in the region. This is not that uncommon
in developing countries and has been observed by various other Asian countries in the same
time period as Viet Nam. Rising carbon intensities often accompany the early stages of the
industrialization process, which is closely linked to accelerated electricity generation mainly
based on fossil fuels (primarily coal). In addition, the emerging but rapidly growing transport
sector is fuelled by oil, which further contributes to increasing carbon intensities11. Vietnam
started the decade from a relatively low base and thereafter industrialized heavily including
carbon-intensive industries like cement manufacture and iron and steel. Industrial energy use
grew from 3.6 million TOE in 1998 to 13.9 million toe in 2007—almost four times in just nine
years. In 1998, industrial sector accounted for one-third of final energy use; in 2007, it
accounted for 46 percent12. Whilst industrial sector growth also leads to increasing GDP, the
industrial sector is over-proportionally responsible for GHG emissions compared e.g. to the
service sector i.e. an increase in the share of industry within GDP will result in general in
increasing carbon intensities whilst a shift towards the service sector will result in declining
carbon intensities of the GDP. Such growth of the industrialized sector is partly responsible for
Vietnam’s energy intensity being about 10 times larger than Japan’s where the service sector
plays a more significant role. Carbon intensity is 2010 around 1tCO2/thousand GDP and is, also
under a low carbon strategy still expected to rise to 1.26 tCO2/thousand GDP (under BAU it
would peak at 1.37 tCO2)13 before dropping. Interesting is the fact that Vietnam’s carbon
intensity of GDP increased more than that of regional comparators as shown in the Figure
below.
10
See World Bank, Vietnam 2030, Charting a Low Carbon Development Path for Vietnam, Draft report, 2014 11
See e.g. http://www.ipcc.ch/publications_and_data/ar4/wg3/en/ch1s1-3-1-2.html 12
World Bank, Vietnam 2030, charting a Low Carbon Development Path for Vietnam, Draft report, 2014 13
World Bank, Vietnam 2030, charting a Low Carbon Development Path for Vietnam, Draft report, 2014
17
Figure 4: Evolution of Vietnam’s CO2 Emissions/GDP Relative to Other Countries (2000=100)
Source: World Bank, Vietnam 2030, charting a Low Carbon Development Path for Vietnam, Draft report, 2014 Disclaimer: This is a provisional and not yet approved report; Data as presented in this report might be incorrect due to the provisional nature of the report; all figures and data shown from this report shall thus be considered as indicative.
2.2. GHG Emission Projections Long-term absolute emissions projections depend crucially on forecasts of GDP growth.
Forecasts range for the period until 2020 from 4% to 7.5% annually14. These forecasts, taken
from a study undertaken by the Central Institute for Economic Management (CIEM- an MPI
institute) assume average 6% annual GDP growth in the period 2011 to 2040. CIEM estimates
that the green growth strategy will bring long-term economic benefits rather than short term
ones by increasing Vietnam’s GDP during 2011-2040 by 4.3 to 4.6%15.
The following Table shows the GHG Scenarios used in a recent MPI/UNDP report on marginal
abatement cost curves for the energy sector.
Table 2GHG Scenarios for Vietnam's Energy Sector to 2030 (MtCO2e)
2000 2005 2010 2020 2030
BAU-min 52.8 101.9 129.1 336.7 615.2
BAU-max 52.8 101.9 129.1 356.0 727.5
Source: All values except 2005 based on MPI/UNDP, A Marginal Abatement Cost Curve Analysis for the Energy Sector in Vietnam, Table 1, 2013 with values 2000 based on the National Communication, values
14
7.5% value based on the Social economic development strategy 2011-2020 drafted by Vietnam in the year 2010
and 4% value based on SKL International, 2013 as cited in CIEM, Macroeconomic Assessment for Low Carbon Options in Vietnam, draft report, 07/2013, p.17 15
Ibid, p.26f
18
2010 estimated and 2020 and 2030 projected; 2005 is based on the DMHCC and JICA, 2005 National GHG Inventory Report, 07/2013; The BAU-min scenario is with policy action and the BAU-max without policy action
The report develops two distinct BAU scenarios. BAU-max scenario reflects a development path
for the energy sectors based on the assumptions that all new capacity built will be using fossil
fuels as their primary sources (as was planned during PDP VI – the previous Power Sector
Development Plan) and that energy efficiency will be based on current effort levels while there
will no use of renewable or nuclear energy. The BAU-min scenario includes all planned policies
and strategies to 2030, amongst others the renewable energy and energy efficiency targets
based on the Power Master-Plan – PDP VII, Coal Master Plan and Gas Master Plan16.
Other approaches come to different results based on assumed elasticity of GDP to energy and
substitution elasticity between fuels as well as critical assumptions concerning GDP growth and
domestic energy price development. The Figure below shows the BAU GHG emissions as
projected in a recent World Bank report17. The scenario presented by this report assumes an
increase by factor 5 of GHG emissions by the year 2030 compared to 2010 resulting in emissions
of around 500 MtCO2 by 2030.
Figure 5: BAU Scenario for Vietnam’s GHG Emissions (MtCO2)
Source: World Bank, Vietnam 2030, charting a Low Carbon Development Path for Vietnam, Draft report, 2014
16
Ibid, p. 16 and 21 17
World Bank, Vietnam 2030, Charting a Low Carbon Development Path for Vietnam, Draft report, 2014; The BAU
Scenario in this study has been constructed to be consistent with different sector and economic plans approved by the Government. For instance, the Power Sector BAU confirms to the Power Development Plan VII
19
The increased use of coal for power generation is expected to account for two thirds of the
increase in Vietnam’s overall GHG emissions over the 2010 to 2030 period. Whatever the BAU
scenario taken, it is clear that GHG emissions of Vietnam will experience high growth in the
coming years.
3. GHG Pledges of Vietnam In June 1992 Vietnam signed the UN Framework Convention on Climate Change and ratified it
on November 1994. In 1998, the Government of Vietnam signed the Kyoto Protocol and ratified
it 2002. With the communication submitted to the UNFCCC Secretariat on March 2010 Vietnam
was listed under the Copenhagen Chapeau Accord. On September 25, 2012 the Prime Minister
approved the Green Growth Strategy which sets forward emission reduction targets:
For the period 2011-2020 reduce intensity of GHG emissions by 8-10% as compared to
2010, reduce energy consumption per unit of GDP by 1-1.5% per year and reduce GHG
emissions in the energy sector by 10% relative to BAU and by a further 10% with
international support;
Orientation towards 2030: Reduce GHG emissions by 1.5-2% per year. Reduce GHG
emissions in the energy sector by 20% relative to BAU and by a further 10% with
international support;
Orientation towards 2050: Reduce GHG emission by 1.5-2% per year.
In relation to the Copenhagen Accord Vietnam indicated on 31/03/2010 that Vietnam considers
a response to climate change as urgent and that all countries must take responsibility18. In the
same document it also stated that Developing Countries need to make active contributions to
the global efforts through the development and implementation of NAMAs on a voluntary basis
ensuring their sustainable development.
4. Climate Change Policies The Figure below summarizes the most relevant climate change related policies of Vietnam of
the last few years which relate to Market Based Instruments (MBIs) in GHG reduction in the
context of the selected sectors for the MRP. These are thereafter briefly summarized.
18
Letter of the Permanent Mission of the Socialist Republic of Vietnam to the United Nations dated 31/03/2010
20
Figure 6: Climate Change Policies Vietnam
Source: DMHCC, MONRE, 2014
RESOLUTION NO. 24-NQ/TW ON 'ACTIVE RESPONSES TO CLIMATE CHANGE, PROMOTION OF
RESOURCES MANAGEMENT AND ENVIRONMENTAL PROTECTION'
Resolution No. 24-NQ/TW was approved by the 11th Party Central Committee in the year 2013.
The Resolution identifies key solutions to be taken to actively respond to climate change as
follows including awareness raising, education, R&D, and to improve financial mechanisms and
policies.
NATIONAL STRATEGY ON CLIMATE CHANGE
The National Strategy on Climate Change was approved by the Prime Minister under Decision
No. 2139/QD-TTg dated December 5, 2011 and emphasizes that climate change will increase its
impacts on all social aspects. For a country particularly vulnerable to the effects of climate
change and sea level rise like Vietnam, mainstreaming this issue into development plans
ministries, agencies and localities is one of the first priorities in responding to climate change. At
the same time, through the reduction of greenhouse gas emissions, Vietnam shows its
responsibility for contributing to the international community's efforts to protect the Earth
climate system. This will help Vietnam take opportunities on international cooperation and
participate in international financial mechanisms. Vietnam’s National Climate Change Strategy
states that between 2001 and 2010, damage caused by such disasters has led to 9,500 dead and
21
missing people and the loss of about 1.5% of GDP each year19. Because of this, Vietnam’s
response is largely focused on adaptation to climate change, and indeed the National Strategy
on Climate Change states that adaptation is the priority in the initial phases of the plan20. The
strategy also states as specific objective that a low-carbon economy and green growth will
become a primary trend in sustainable development.
NATIONAL ACTION PLAN ON CLIMATE CHANGE
The National Action Plan on Climate Change for the period 2011-2020 approved by the Prime
Minister under Decision 1474/QD-TTg dated October 05, 2012 sets out specific objectives and
key tasks to realize the Strategy.
NATIONAL TARGET PROGRAM TO RESPOND TO CLIMATE CHANGE (NTP-RCC)
In 2008 the National Target Program to Respond to Climate Change (NTP-RCC) was adopted by
the Prime Minister under Decision 158/2008/QD-TTg and approved under Decision 1183/QD-
TTg dated August 30, 2012 is now in its second phase until 2015. A third phase (development) is
anticipated after 2015.
NATIONAL GREEN GROWTH STRATEGY (GGS)
The National Green Growth Strategy adopted in 201221 has as overall objective to achieve a low
carbon economy and to enrich natural capital. This is defined in the Glossary of the Decision as a
strategy to promote the process of restructuring and improving economic institutions towards
more efficient use of natural resources, improved competitiveness of the economy which will be
achieved through increased investments in technological innovation, natural capital and
economic instruments. This will contribute to respond to climate change, reducing poverty and
ensuring sustainable economic development. Green growth shall become the principal direction
in sustainable economic development. The reduction of GHG emissions and increased capability
to absorb GHGs are considered as important indicators in socio-economic development. It
includes as strategic objective to reduce the intensity of GHG emissions and promote the use of
clean and renewable energy.
The organizational structure for steering and coordinating the implementation of the Green
Growth Strategy foresees the establishment of an Inter-Ministerial Coordinating Board under
the National Committee on Climate Change. The Ministry of Planning and Investment MPI is the
focal point for green growth, responsible for leading and coordinating with concerned
ministries, sectors and People’s Committees of Provinces and centrally managed cities to
implement the green growth strategy. The Ministry of Finance shall take the primary
responsibility and coordinate with the MPI to ensure funding and the Ministry of Natural
19
Vietnam National Strategy for Climate Change, promulgated with the Prime Minister’s Decision No. 2139/QD-TTg of
05/12/2011, Art I.1. 20
Idem Part II Strategic Viewpoints, 3rd point 21
Decision 1393/QD-TTg of 25/09/2012
22
Resources and Environment (MONRE) takes the lead and coordinates the policy making process
for response to climate change in general, guiding the registration, monitoring, verification and
reporting of GHG emissions.
NATIONAL ACTION PLAN ON GREEN GROWTH
Based on the Green Growth Strategy the Prime Minister approved the Green Growth Action
Plan with Decision No: 403/QĐ-TTg, on March 2014. The Action Plan defines 66 activities in 4
main themes:
1. Setting up institutions and formulating green growth action plans at the local level
2. Reducing the intensity of GHG emissions and promoting the use of clean and renewable
sources of energy
3. Greening production
4. Greening lifestyle and promoting sustainable consumption
The Action Plan sets priorities in actions (Prioritized Activities), defines the responsible
organizations, and includes deadlines and financial resources for each activity for the period
2014-2020.
Other environmental policies which have an impact on the development of MBIs in the climate
change field are discussed in BB2 under the policy framework.
5. Vietnamese Carbon Market Experience
5.1. CDM As of November 2013, 249 Clean Development Mechanism (CDM) projects in Vietnam have
been registered of which 237 from the energy sector with the large majority being hydroelectric
projects, mostly from the private sector22. Around 50% of the projects are small-scale ones and
50% large scale ones. Vietnam is the country with the 4th largest portfolio of CDM projects
worldwide just after China, India and Brazil and before Mexico and Malaysia. However most of
the projects were registered relatively late i.e. when prices in the CER market were already
declining sharply. This is also reflected in terms of issuance where Vietnam has only slightly less
than 9 million CERs issued as of end 2013 thus being on the 7th position behind Indonesia,
Mexico and Korea. This is basically a result of lengthy validation, registration and issuance
processes within CDM, easily resulting in 4-6 years between starting up the process and the first
issuance of CERs. It also depends on the starting date of operations which can be significantly
after project registration due also to additionally requirements of the UNFCCC.
22
UNFCCC database
23
9 PoAs and 14 Verified Carbon Standard (VCS) projects have also been registered as well as 4
registered Gold Standard projects. The CDM PoA23 for the Renewable Energy Development
Program (REDP) supported by the World Bank is a good market experience of the Government
how investment barriers can be overcome through the involvement and interaction of
international donors, private developers, private Vietnamese banks and carbon buyers. The
program for supporting the investment for new hydropower plants in Vietnam is on a successful
way, the first verification process was started recently.
Within the sectors involved in this MRP, Vietnam has 6 registered CDM waste projects which will
be discussed further in chapter 4. In the building, transport as well as in iron and steel sectors no
CDM/VCS projects have been registered, which is not exceptional as relatively few CDM or VCS
methodologies have been developed and are in operation for these sectors.
Problems encountered with the CDM process included, as in most countries worldwide, a
lengthy validation and registration process as well as sometimes a time-demanding national
approval process, resulting also in the late registration and thus in monetary losses for many
projects. For the last two years, these procedural problems have been compounded by the lack
of demand for carbon credits, leading to low prices. In many cases, these low prices now make
monitoring and issuance for many projects not worthwhile anymore. Ownership (private or
public) of projects has, similar to other countries, not been a core issue concerning time
requirement. The CDM has contributed positively towards sustainable development in Vietnam;
however the transfer of finance has been less than expected due to the market decline.
Vietnam has had limited success in financial terms with the CDM market – it could however gain
significant experience with the procedures including MRV of the CDM and of voluntary carbon
markets. This experience is basically in the area of energy projects and within that sector
basically geared towards hydroelectric projects – however the important aspect is the national
capacity created in terms of baseline determination and MRV as well as familiarity with a market
based instrument which pays according to results achieved. The wealth of experience and the
created national capacity, not least in the private sector e.g. amongst project developers, is an
asset which can be used towards well-structured and managed NAMAs as well as for the
development of national GHG markets.
5.2. NAMAs/JCM The following table lists the currently planned NAMAs in Vietnam, none of which as of today has
a detailed scope or implementation plan.
Table 3: NAMAs in Preparation in Vietnam (as of end 2013)
Sector Activity/Scope Involved Institutions
Solid waste With support from Japan, IMHEN is carrying out a IMHEN (MONRE),
23
For details see http://cdm.unfccc.int/ProgrammeOfActivities/poa_db/069O1LAWYS37INVEB5RZHMCU4KJFPD/view
24
Sector Activity/Scope Involved Institutions
research on possibility development of NAMA on solid waste applying for small cities (Quy Nhon), expected to finish in 2020
UNESCAP OECC (Consultant)
Steel sector
The proposed steel NAMA is based partially on the UNIDO report "Energy and Resource Efficiency in the Vietnam Steel Industry" (July 2011). Based on a survey in 18 companies using EAF technology the report assessed the GHG mitigation potential. The timeframe for the MOIT-UNDP project is 2012 – 2016 but the NAMA will probably have a longer timeframe. The NAMA preparation framework includes technical, legal and financial components. The establishment of a MRV system is considered as crucial.
UNDP; Industrial Safety Techniques and Environmental Agency (MOIT)
Chemical fertilizer sector
The timeframe for the MOIT-UNDP project is 2012 – 2016 but the NAMA will probably have a longer timeframe. The NAMA preparation framework includes technical, legal and financial components. The establishment of a MRV system is considered as crucial.
UNDP; Industrial Safety Techniques and Environmental Agency (MOIT)
Cement sector The goal is the development of a NAMA for the cement sector including MRV systems. The activities will include: - Collection of updated sector data on emissions,
technologies, costs and mitigation potential; - Development of baseline emission projections
for a range of scenarios - Development of a MRV system based on
international standards - Development of data systems and institutions
for data collection - Design of a credible support scheme and a
policy mix that can help attract international climate finance
- Identification of barriers related to technology, information and capacity.
Development of a NAMA
MOIT NOAK/NDF
Wind power Framework of FIRM (Facilitating Implementation and Readiness for Mitigation) of UNEP Risoe Centre; Preliminary sectors have been identified and discussions are currently taking place to prioritize sectors for developing NAMAs within the FIRM project.
Department of Meteorology, Hydrology and Climate Change, (DNA MONRE); UNEP Risoe
Biogas in rural area
Framework of FIRM of UNEP Risoe Centre; preliminary sectors have been identified and discussions are currently taking place to prioritize
Department of Meteorology, Hydrology and Climate Change,
25
Sector Activity/Scope Involved Institutions
sectors for developing NAMAs within the FIRM project.
(DNA MONRE); UNEP Risoe
GIZ is also planning to start a NAMA program in Vietnam. The program in cooperation with
MONRE will support the establishment of a NAMA framework, implementation of a sector-
based MRV system and in a later phase the development of two bankable NAMA proposals.
Sectors for this venture have not yet been defined.
Concerning the NAMA readiness of Vietnam the following Figure shows the different
components.
The Minister of Natural Resources and Environment of Vietnam and the Minister of Economy,
Trade and Industry of Japan also signed a memorandum of cooperation on low-carbon growth
between Vietnam and Japan July 2013. This should eventually result in the implementation of a
joint crediting mechanism (JCM) between the two countries.
26
Table 4: NAMA Readiness Support Programs
Planned tasks Expected results International support
Implementing agency GoV
General capacity building for NAMA development, implementation and management
Improved know-how in NAMA development, implementation and management: 1. NAMA potential assessment completed 2. Feasibility studies for NAMA development in selected sectors 3. NAMAs implemented
JICA DMHCC in cooperation with IMHEN, ISPONRE
Transformation from domestic mitigation actions to internationally approved NAMAs
Improved capacity of GoV agencies in transforming domestic NAMAs into internationally approved NAMAs
JICA DMHCC in cooperation with IMHEN, ISPONRE
Institutional framework for coordination and management role of NAMAs
Establishment of: 1. Institutional framework for NAMAs; 2. Legal framework for NAMAs 3. Action plan for NAMA development
JICA DHMCC
NAMA Advisory Mechanism NAMA Advisory Board and legal framework for board are established
UNDP DHMCC
Research on Monitoring Methodologies
Implementation of an approved set of monitoring methodologies GIZ
IMHEN in cooperation with DMHCC, ISPONRE
Development of NAMA reporting and verification system at local and national levels in order to meet international standards developed by the UNFCCC
NAMA R&V system 1. Provincial level 2. National level 3. International accepted systems
UNDP (training) JICA (reporting)
DMHCC in cooperation with IMHEN, ISPONRE
Pilot NAMAs
Sector evaluation; Feasibility studies ; MRV system for the pilot NAMAs; Dissemination
GIZ
IMHEN in cooperation with DMHCC, ISPONRE
Improvement of negotiation capacity for international cooperation on NAMA
Know-how established in: 1. NAMA and climate change financing 2. NAMA technical issues at UNFCCC level 3. Elaborating policy positions for international negotiations (e.g. UNFCCC COP)
UNDP
DMHCC IMHEN
Source: DMHCC, MONRE, 2014 DMHCC: Department of Meteorology, Hydrology and Climate Change, IMHEN: Vietnam Institute of Meteorology, Hydrology and Environment ISPONRE: Institute of Strategy and Policy on Natural Resources and Environment
27
1. Policy Mapping and Gap Analysis
1.1. Key Elements of Vietnams Energy Policy Key elements of Vietnam’s energy policy include the following policy documents.
The Law on Energy Efficiency and Conservation24 includes as policies to use energy
economically and efficiently: the promotion of the use of energy-saving devices and equipment;
the implementation of an energy labelling roadmap; and the increase of renewable energy use
rates. It includes as MBIs energy price subsidies and incentives as well as information
instruments such as labels. Following the implementation of the Decree an institutional setup
was established. The Energy Efficiency and Conservation (EEC) Office was set up within the
MOIT in charge of coordinating energy efficiency and conservation efforts across the economy.
In October 2012 within this framework the National Target Programme on Energy Efficiency and
Conservation Phase 2012 – 2015 was approved25.
The Electricity Law (2004), which initiated power industry reform, including restructuring and
equalization of various units under EVN and mobilizing /diversifying investment; encourage
economical use of electricity and develop a competitive electricity market. It includes electricity
pricing policy, gradually eliminating the price subsidy regime. In July 2005 a road map was
developed, with Phase I on establishment and operation of a competitive market for power
supply, to be purchased by EVN. In Phase 2 wholesale competition, i.e. a wholesale market with
several bulk buyers and sellers. Phase 3 (from about 2020) sees retail competition and
customers will access different suppliers. This is line with the proposed liberalization processes
for many countries.
24
National Assembly, 17/06/2010 25
Decision 1427/QD-TTg of 02/10/2012
BUILDING BLOCK 2: ORGANIZATIONAL SETUP, POLICY
LANDSCAPE AND PREPARATORY WORK
1. Policy Mapping
2. Sector Selection
3. Organizational Setup
4. Objectives, Activities, and Proposed Budget
28
The Environmental Protection Tax Law,26 which took effect on January 1st 2012 includes as
taxable subjects amongst others liquid fuels (except biofuels) and coal and has as goal the
promotion of sustainable development. The tax is collected on goods with a negative
environmental impact. Tax rates are specified in absolute terms in the tariff table of the law with
the notion that the tax rate shall be in line with socio-economic development policy and the
extent of negative environmental impact caused by the good. To date this law has not resulted
in a higher tax on liquid fuels as the former fuel tax was cut whilst including the lower bound of
the new tax thus resulting basically in a re-labelling of the tax. Nevertheless the introduction of
the concept of an environmental tax could be important in the future as an instrument to
reduce GHG emissions e.g. in the form of a carbon tax.
The National Master Plan for Power Development for the 2011-2020 Period with the Vision to
203027 includes as objectives: to prioritize the development of renewable energy sources for
electricity production by increasing the share of renewable energy from 3.5% in the year 2010 to
4.5% in the year 2020 and 6.0% in the year 2030 and to reduce the elasticity coefficient
electricity to GDP from 2.0 in the year 2010 to 1.5 in the year 2015 and 1.0 in the year 2020.
In November 2012 Vietnam approved the Project of GHG Emission Management28. This Project
has as general objective the management of GHG emission in order to implement the United
Nations Framework Convention on Climate Change (UNFCCC) and other international
agreements of which Vietnam is a Party, whilst at the same time taking advantage of the
opportunity to develop a low carbon economy together with the international community and
thereby contributing to the implementation of the country's sustainable development goals. As
specific target it includes preparing the framework to register and widely deploy Nationally
Appropriate Mitigation Actions (NAMAs). The Decision also includes the set-up of a system of
measurement, reporting and verification (MRV), including at national and sectoral levels set in
the early stages of the Project in order to serve the requirements related to the development of
the national greenhouse gas inventory and the management of greenhouse gas emissions and
the development of emission factors for the country.
These documents provide Vietnam with an overall advanced energy and climate landscape.
Challenges remain however in the actual realization of policy goals of these documents. Several
factors are discussed in the following sections.
1.2. Reliance on Fossil Fuels Vietnam has experienced some of the fastest growth rates in the region, alongside an inflow of
foreign capital into some of the energy-intensive export-driven sectors. The saturation of
domestic supplies (mainly hydro) and the lack of cost competitiveness (to date, at least) of
26
Approved by the National Assembly on 15/11/2010 27
Decision 1208/QD-TTG of 21/07/2011 28
Decision 1775 Approval of Project of Greenhouse Gas Emission Management; Management of Carbon Credit
Business Activities to the World Market, 21/12/2012
29
major renewable and other low carbon options, has led to increased import volumes of coal and
oil. In addition, the current stock of industrial and power sector infrastructure provides for room
for improvement in efficiency.
The following figure illustrates the aforementioned trends: hydropower accounted for 72% of
the annual 14.6 TWh (tera-Watt hour) of electricity production in 1995, but by 2010it accounted
for just over 24% of the annual electric power generation of 97.4 TWh. Gas turbine generation
expanded from 746 MWh (mega-Watt hour) to 45 TWh from 1995 to 2010 (from about 5% to
47% of power production) and generation by coal fired thermal plants increased from 2 TWh to
over 16.5 TWh (from about 13% to 17%), whilst there is increased import of electricity from
China.
Figure 7: Fuel Share of Electricity Production Vietnam 1995-2010
Source: UNDP (2012), based on EVN (2010)
1.3. Liberalization Process and Fossil Fuel Price Controls
As the policy document list below indicates, the energy liberalization process, initiated with the
Electricity law of 2004, is far from complete and has experienced setbacks in the move towards
full cost recovery, with the introduction recently of new price controls and subsidies. These have
been justified, as elsewhere, on the basis of the need to affordable access to energy for
households and industry, long pursued through various forms of fossil fuel price control, subsidy
and tax reduction. Based on extensive international research and experience with fossil fuel
subsidies, the current energy price controls in Vietnam are unlikely to be effective in increasing
productivity and growth and reducing poverty, whilst they do not seem to enable sustainable
public finances, energy security or greenhouse gas emissions mitigation.
30
Electricity prices are still highly regulated, i.e. capped and differentiated for different users,
although market reform has been set in motion by the Electricity Law of 2004. Domestic coal
prices are set well below world market prices in order to enable cheap electricity production
and manufacturing. There are also price ceilings in the refined petroleum markets, and there are
various taxes and tax waivers. The total value of energy consumption subsidies in Vietnam has
been calculated by the IEA in 2010 as near 2.83% of Vietnamese GDP (see Table below).
Table 5: Consumption Subsidies in Vietnam (Billion USD)
Energy Source 2007 2008 2009 2010
Oil 0.32 1.09 0 0
Gas 0.09 0.21 0.13 0.23
Coal 0.01 0.01 0.01 0.01
Electricity 1.68 2.25 1.06 2.69
Total 2.1 3.56 1.2 2.93
Total as % of GDP in current USD 2.95 % 3.94% 1.24% 2.83%
Source: IEA (2011), quoted in UNDP (2012)
These are mostly indirect subsidies, particularly in the form of indirect support to electricity
providers and SOEs. Vietnam’s price controls mean that SOEs in the energy market are forced to
make losses, which are substantial and are compensated by the State because these
Box 1. A Challenging Road to Energy Liberalization
The Electricity Law (2004), framework law for the liberalization process
Decision 21/2009/QD-TTg, initiating electricity tariff reform, including moving
towards cost recovery, increasing average tariffs and transparency in tariff setting,
phasing out of cross subsidies from commercial user to residential users and on
restructuring of block tariffs for residential users.
Price caps on electricity for sale to households and industries, through e.g. Decision
268/QD-TTg (23 February 2011), regulating electricity retail prices for different users
(manufacturing and other businesses; administrative agencies, residents), depending
on the time of the day and amounts used.
Decision 24/2011/QD-TTg allows EVN to increase electricity prices by 20% per year
without seeking government approval, i.e. increase prices up to 5% on a quarterly
basis without approval from the MoF.
Circular 05/2011/TT-BCT (25 February 2011), regulating the price of electricity in
2011 for all organizations and individuals buying and selling electricity from the
national grid
Decision 268/QD-TTg, February 2011, introduces a small subsidy on electricity for
3.2 million low income households, i.e. a monthly payment of VND30,000 (US$1.4) as
well as lower prices for the first 50 kwh of electricity use, VND993 per kwh rather
than the new price of VND1,242 per kwh
31
monopolistic companies must continue to supply their services. The lack of competition in the
energy market may also hide inefficiencies in the SOEs, at every step of the value chain of
different energy products, which compound the losses and the need for bail-outs.
In turn, these losses also mean that SOEs will lack investment capital to increase supply and
meet rising demand, or to invest in innovative technology for energy saving and renewable
energy. Furthermore, the lack of a level playing field for SOEs, and the domestic private and FDI
sectors, in particular to the access to affordable credit, means that the latter hesitate to invest in
energy markets, including in renewable energy generation.
1.4. Gaps in Monitoring and Enforcement of Energy Conservation and Efficiency Policy
Given the prevalence of price controls in particular on the consumption side and the loss-making
nature of utility operation in Vietnam, it is not surprising that both the household and industrial
sectors have had relatively low performance with respect to energy conservation and efficiency
efforts, despite the drafting of new energy plans and the development of a Green Growth
Strategy. Some of these factors are recognizable internationally, such as the lack of knowledge/
comfort of the financial sector in relation to energy efficiency finance. Others are more Vietnam-
specific, including the poor enforcement record. A recent study29 indicates a number of factors
leading up to that record:
Legislation: Energy efficiency legislation is generally in place but enforcement is weak. As
indicated above, the Law on Energy Efficiency and Conservation (2010) is the cornerstone of
the EE legal framework. The government issued 10 decisions, decrees and circulars as secondary
legislation to support the law. Limited success has been registered as the law is not yet
supported by enforcement capabilities.
Institutional weakness: Many policy and regulations are in place but the implementing
institutions are significantly weak. The EE&C office was established through Decision No.
79/2006/QD-TTG dated April 14, 2006, and Vietnam’s National Energy-Efficiency Program
(VNEEP I) was established in the same year. The program saved 4,900 ktoe of energy when it
ended in 2010, and VNEEP II was launched in 2011. Additional programs include the Standards
and Labelling (S&L), Promoting Energy Conservation in Small and Medium Scale Enterprises in
Vietnam (PECSME), and the building codes program run through Vietnam Building Energy
Efficiency Codes. The government also set a target of 5-8% energy savings between 2012 and
2015, and the targets were allocated to provinces. All these programs have had limited success
because the responsible institutions are weak. The EE&C office is temporary and it is uncertain
what will happen to the office when VNEEP II ends. Moreover, the EE targets and agreements
with large energy consumers are voluntary; hence there are no incentives to implement EE
measures.
29
WB Low Carbon Options report (in draft)
32
Financing and implementation: EE financing and implementation capacity is limited.
Development institutions such as IFC and the WB have provided some EE funding. MOIT has a
US$1million subsidy fund which offers a subsidy up to 30% of the project cost with a cap of
US$250,000 per project. The government also funds energy audits, technical assistance and
training, and promotes EE. However, the incentives are limited and complex to use, and banks
are hesitant to lend for EE because they do not understand it well. Additionally the interest rates
are high, and there is virtually no project finance for energy efficiency in Vietnam.
Capacity building and awareness: Existing capacity building and awareness programs can be
strengthened. The Vietnam Industry Association holds awareness workshops, and provides EE
training to its members. The government and universities also provide training for energy
managers. However, there is limited EE awareness among SMEs, and there is an EE capacity gap
among workers, engineers and managers.
Market characteristics: The industrial sector is dominated by SOEs which make it harder for
small and medium scale enterprise to thrive. As stated above, the disparity of access and
general economic conditions of SOEs in relation to other competitors introduces additional
challenges, in particular for SMEs and companies looking to offer energy conservation services.
Despite new laws typifying the development and encouraging the establishment of ESCOs, these
have not yet taken root in Vietnam.
1.5. Implications for MBI Design and Implementation
The above mentioned factors and gaps identified in the current transition period in the
Vietnamese energy liberalization and development process indicate some potential challenges
but also opportunities for the deployment of market-based instruments.
Clearly the shielding of economic agents from the full impact of cost variations leads to
inadequate price responsiveness. This implies that, should market-based instruments be applied
in relation to protected sectors and activities, they must be done so in conjunction with a
stronger emphasis on price liberalization. Otherwise, introducing carbon pricing in a context
where price caps are prevalent across the energy value chain will only add to the current
unsustainable financial situation of most agents. Consequentially, effort should be put into
detailing how any particular proposed MBI will interact with the current and prospective
landscape.
The current overview of the energy sector indicates opportunities at two levels. The impending
renewal of the capital stock in the power sector but also in some selected industrial sectors (as
identified in the Low Carbon Options report) means that opportunities for deployment of low
carbon options will be available and should be encouraged by correct pricing signals. In addition,
the subsidy and pricing reform process will also yield opportunities as this process may be
considered as recast as a mitigation policy itself.
33
1.6. Identification of Policy Objectives and Criteria to Guide Elaboration
of MBIs With the policy landscape outlined in the previous section in the backdrop, one can identify
several political objectives/ criteria for the elaboration of market instruments in support of
Vietnamese climate policy.
EFFICIENCY
One first criterion is that of increasing efficiency in energy usage, thus reversing the current
trend as outlined in BB1. This would in turn assist in reducing the expected growing dependence
of Vietnam on imported sources of energy.
This first criterion argues for in particular:
Larger deployment of domestic sources of energy, in particular in the field of renewable
energy;
A stronger effort on energy conservation and efficiency, particularly in the field of
enhancing effectiveness in enforcement of existing legislation and standards.
DONOR COORDINATION
One second criterion relates to the avoidance of overlap with existing initiatives. This indicates
the need to consider the range of donor initiatives in the field of energy and climate that may
impact on the effectiveness of the contribution by the PMR. The following table provides a non-
exhaustive overview of donor-financed climate change related activities in Vietnam. The
following table includes summarized all relevant donor-finance climate change activities while
Table 3 and 4 of Section 5.2. included only activities related directly to NAMA’s.
34
Table 6: Overview of Donor Financed Climate Change Activities in Vietnam
Donor GoV Activities/Scope Year
HUT, UNIDO, SECO INEST
Vietnam Cleaner Production Centre (VNCP), now an incorporated entity. VNCPC supports the GHG mitigation in Vietnam with projects in energy efficiency, waste minimization (e.g. methane gases in waste), resource efficiency programs and also with "greening the life style in Vietnam” (see GetGreen Vietnam). With the Green Credit Trust Fund VNCPC (see below) it gained also experience in market based instruments. The VNCPC can share much experience and know-how with the MRP program in the target sectors; overlaps with the MRP Vietnam do not exist. (http://vncpc.org/en/projects/)
1998 - ongoing
SIDA/UNEP N/A
Energy Efficiency Guide for Industry in Asia The project is complementary in the field of energy efficiency for the MRP Vietnam. http://www.energyefficiencyasia.org/translate_vietnamese.html
2006 - ongoing
JICA MONRE
GHG emissions inventory JICA supports the implementation of international standards for the establishment of the National GHG inventory. The inventory 2005 was already established and used for the MRP; the inventory 2010 is in progress. The national GHG inventory is an important part of the MRP Vietnam. on-going
NEFCO MONRE Feasibility Study for NAMA Development in Vietnam and Peru. Based on this study the Nordic Development Fund (NDF) is currently starting a project together with MOC for the implementation of a NAMA in the cement sector. on-going
SECO, VNCP, private bank
Private sector
Green Credit Trust Fund (GCTF) The objective of the GCTF is the promotion of long-term investments to SMEs in cleaner technologies with a positive impact on the environment and to contribute to the sustainable development of Vietnam. This is achieved thanks to a reduction of the demand on collateral (50% guarantees) and a partial reimbursement (up to 25 %) of the invested capital, based on the environmental impact resulting from the investment. The GCTF is a source of experience for MBIs in the Industry - thus, complementary and not overlapping with the MRP Vietnam. http://vncpc.org/en/project/green-credit-trust-fund-gctf/
2007-2017
ADB/ Nordic Dev Fund
MOIT, MOC, MOT, provinces
Support for the NTPCC with focus on Energy and Transport (TA 7779) with following outputs: 1. Action plans to respond to climate change period 2016-2020 for MOIT, MOT and PC of Thanh Hoa province, HCMC and Da Nang Cities 2. Stronger institutional capacity of agency staff to plan and design climate change responses. 3. Community awareness campaign designed and implemented. 4. Pilot projects developed to help reduce GHG emissions and optimize adaptation responses to climate risks. Important to coordinate activities with the project when action plans are available to use synergies and prevent overlaps.
2012-2014 /study in approval process of MOIT
DANIDA/MCEB
MOIT MOC
Denmark is the first donor to support the Vietnamese National Target Programme to Respond to Climate Change from 2009 to 2015, thus supporting Vietnam's efforts to combat global warming and improve energy efficiency (VNEEP).
DANIDA/MCEB
35
Donor GoV Activities/Scope Year
Den-mark
The development objective is: “Improved energy efficiency in small and medium enterprises and buildings in Viet Nam contributes to sustainable development and a transition to a low carbon economy”. This objective is consistent with the VNEEP phase 2 objectives and also consistent with the current DANIDA support to VNEEP. The objectives are: For component 1) Energy efficiency in SMEs – “Small and medium enterprises in at least 3 sectors adopt energy efficiency measures that will contribute to the VNEEP energy saving targets of between 5-10%. This objective will be achieved through support to project #2.3 under the VNEEP 2011-15, complemented by the initiation of lasting partnerships between Vietnamese and Danish industries. For component2) Energy efficiency in buildings - “Improved capacity for implementing Energy efficiency in large buildings improves and contributes to the VNEEP energy saving targets of between 5-8%.” This objective will be achieved through support to project #3.1/3.2 under the VNEEP 2011-15, complemented by the initiation of a partnership between the MOC (Viet Nam) and MCEB (Denmark). Furthermore, Denmark is also active in the climate change adaptation and mitigation (CCAM). The program has two component: - Climate change adaptation (respond to CC) - Climate change mitigation through energy efficiency in Vietnamese enterprises.
Den-mark
EU MOIT
European Trade Policy and Investment Support Project (EU-MUTRAP) - new phase The EU-MUTRAP purpose to support the MOIT in facilitating sustainable international trade and investment through improved capacity for policy making, policy consultation, and the negotiation and implementation of related commitments, particularly vis-à-vis the EU The EU-MUTRAP objectives support the outcome of the MRP Vietnam and it is fully complementary (e.g. incentives through trade and investments). http://mutrap.org.vn/index.php/en/home/
New phase 2012-2016
UNDP MOIT
Strengthening capacity on climate change initiatives in the industry and trade sector The Outputs of the projects are the following: Outcome 1: Policy and market barriers to commercially viable investments in targeted industry sub-sectors to reduce GHG emissions, enhance climate resilience and exploit associated green trade opportunities are identified and options to overcome barriers are developed. Outcome 2: Increased knowledge and capacity of policy makers at MOIT and other relevant Ministries has enabled the Government of Vietnam to develop evidence-based policy measures to promote sustainable industrial development. Outcome 3: Greater knowledge of sustainable industrial production and capacity of financial institutions and consulting firms has improved the investment environment for industrial enterprises in target industry sub-sectors to reduce GHG
2012-2016
36
Donor GoV Activities/Scope Year
emissions and increase resilience to climate change impacts. Within this program UNDP together with MOIT are developing two NAMAs - one in the steel and one in the chemical sector. The outlined activities in the steel sector have been integrated into the consideration of the proposed activities in the MRP Vietnam. Through regular donor workshops overlaps can be eliminated and synergies can be used.
World Bank MOIT
CDM PoA for the Renewable Energy Development Program (REDP) aims to develop hydropower projects in Vietnam. The PoA focuses on the carbon finance aspects of REDP that seek to overcome multiple barriers that prevent investment in the renewable energy sector in Vietnam and contributes to the greenhouse gas emission abatement. The program experience with MBI - a) facilitating of investment - b) integrative set-up with GOV, international donors, private CDM developers, local bank institutes and carbon buyers can be integrated in the implementation phase of the PMR.
MOFA-Japan, MOE-Japan, METI-Japan
MONRE, MOIT, MOC, MPI, MARD, MOT, MOST
Joint Crediting Mechanisms (JCM); In July 2013 Vietnam and Japan signed a bilateral memorandum for the cooperation for the Low Carbon Growth. In this agreement verified reductions or removals from mitigation projects under the JCM will be used as part of Japan's internationally pledged GHG mitigation efforts. Based on the meeting report of the second Joint Committee the pilot areas might be beer factories, heat pumps to marine products processing industry, low carbon hotels and green hospitals. There are currently no overlaps concerning the target sectors of the PMR but anyway the JCM program can effect also the MRP implementation in various ways (e.g. MRV, credits, double counting, etc.)
2013-2020
37
In addition NAMA related initiatives have been identified, alongside the NAMA readiness
supports. These have been detailed in BB1 under section 5.2.
The implication of this information on donor activities is that there is already a considerable
level of activity in relation to the potential scope of the PMR, and that therefore the overarching
criterion of allocation of further readiness support, specifically in relation to the readiness for
potential market instruments, may well be that of avoiding overlap with ongoing initiatives.
COST-EFFECTIVENESS
A final criterion must clearly be that of cost-effectiveness. As indicated above the current
situation is dominated by inefficiencies across the value chain, mostly derived from the market
structure (little competition in the sectors and predominance of the SOEs) and the prevalence of
energy subsidies. In line with the principle of full cost recovery, subsidy removal should be
coupled with instruments for reducing external costs associated with energy use, in particular
health impacts. Coupled with the difficult situation of the Vietnamese economy and the loss in
value of the Vietnamese dong, this adds pressure to the need for cost-effectiveness and the
consideration of possible win-win solutions.
In accordance with this criterion, we next investigate the suite of abatement cost studies
performed in Vietnam.
1.7. Abatement Cost Curves in Vietnam: Some Preliminary Results
A major study has been undertaken by the World Bank, with support by DFID and the local
participation of several agencies of MPI and EVN on the development of MACC for the
Vietnamese economy. As this is the most recent and complete study on cost-effectiveness of
mitigation options in Vietnam, its preliminary findings are outlined here.
Vietnam’s total CO2 emission in 2010 was estimated at 110 MtCO2. The study develops two
emission scenarios (see Figure below) for the horizon 2030 a BAU scenario which is predicated
on continuation of current trends, and an LCD (Low Carbon Development) scenario which is
instead predicated on the deployment of all mitigation measures deemed technically and
economically feasible under current conditions identified with a marginal abatement cost lower
than USD 10/tCO2e (only less than 2% of total potential evaluated in this study have marginal
abatement cost over $10/tCO2). The LCD scenario assumes an identical set of socio-economic,
demographic, and macro indicators to that of the BAU scenario.
The total emission under the BAU is projected to rise to 280 MtCO2 in 2020, and reach 496
MtCO2 in 2030—4.5 times the emission in 2010. In transitioning to a LCD scenario, a range of
emission reduction measures have been evaluated.
38
Figure 8: GHG Emissions under BAU and LCD (MtCO2)
Source: World Bank, Vietnam 2030, Charting a Low Carbon Development Path for Vietnam, Draft report, 2014
The Figure above highlights the prevalence of a strong mitigation potential in the power sector,
In particular on the existence of cost-effective supply options mostly derived from a switch from
coal to gas and from sub- to supercritical coal technology and shows CO2 mitigation potentials in
power generation, industry, and transport sectors. The reduction potentials in the power sector
are as a result of (i) energy efficiency improvement in electrical appliances in the residential
sector, (ii) electricity savings from industrial energy efficiency measures, and (iii) fuel switching
in electricity generation, from coal to natural gas, nuclear and renewable energy sources
including hydro-power, wind, solar, as well as biomass.
The impacts of investment in the various low carbon options will grow over time. Under the LCD
scenario, total CO2 emission is projected at 259 MtCO2 in 2020 (7.3% reduction relative to the
BAU), and at 362 MtCO2 in 2030 (26.9% reduction relative to the BAU). In cumulative terms,
total CO2 mitigation amounts to 823 MtCO2 between 2010 and 2030, with over two-thirds of
the overall reduction coming from power generation sector. CO2 reductions from transport and
industry sector constitute about 30% of the total reduction. Cumulatively, this is 253 MtCO2
avoided during 2010-2030, and is more than double the size of CO2 emitted over the entire year
in 2010.
The MAC study adds support to the notion that the impact of energy liberalization on GDP on
energy prices would be substantial in the short term in both the reference and the LCD
scenarios. Under BAU, unit costs of electricity would rise from (in real 2010 terms) 8.5 US cents
to 10 cents by 2016, fall to 9 cents by 2020, and then rise gradually to almost 11 cents. From
2015 through 2030, this represents an average 1.4 percent annual increase above inflation. This
cost includes all utility costs of generating and supplying electricity; it does not include the costs
39
of externalities. Under the LCD scenario, unit electricity costs would be only slightly higher than
under BAU, reaching just over 11 US cents (in real 2010 terms) by 2030.
However, once external costs are factored in, in particular health costs related to the unit cost
of electricity, the electricity cost would be lower under the LCD scenario than under the BAU if
the economic cost of carbon and local pollutant emissions were included in the electricity cost.
The LCD scenario emits significantly less CO2 and local pollutants (particularly from coal
combustion). As the report states, “It is critical to be aware of these costs of the BAU, as the
country will ultimately pay them, even though they are not paid by the utility”.
The increase in the cost of electricity in both scenarios is driven primarily by scarcity of domestic
fuels and growing electricity consumption. This manifests in an increase in fuel costs and
increased generation investment. Vietnam is projected to rely more heavily on coal and gas as
new hydro will become unavailable, which will deplete its domestic sources (thus raising their
prices) and require new reliance on costly imports. It is also projected to remove coal subsidies,
further increasing domestic coal costs. Lastly, it will add significant generation capacity,
requiring large capital expenditures and increased O&M costs.
Some caveats are important when utilizing these results:
MACs will vary considerably depending not only on the investment cost and discount
rate (latter being especially important for comparing short-term and long-term options)
but also on the operational costs and benefits included.
Results are very dependent on the methodological approach concerning social versus
private costs and the inclusion or non-inclusion of risk.
Assumptions on emission reductions can also vary considerably thus influencing again
MACs.
Core abatement options and potentials for the PMR sectors are detailed in the respective sector
chapters.
The strong implication of the aforementioned MAC study for the design of MBIs, particularly in
energy-intensive industries is the prevalence across sectors, and in particular in the power
sector and the industrial sector of strong opportunities for cost-effective mitigation measures.
This implies a potential for the use of market instruments which would normally target the
lower end of the marginal abatement costs curve, with a substantial suite of “no regret” or “win-
win” measures (e.g. negative abatement cost), although part of that cost must be “recouped”
socially through increased productivity and other social benefits.
40
2. Sector Selection In terms of the potential selection of sectors and activities to be covered by the PMR in its
implementation phase, the three criteria identified in the former section as crucial for MBIs are:
Competitiveness: The first criterion argues against Vietnam undertaking measures, at
this juncture in its economic development process, that may add to the financial burden
in particular of its SOEs, as these will face increasing pressure as price caps and other
distortions to their operation will disappear in line with stated policies. A preference for
potential crediting rather than trading instruments is therefore chosen, despite the
recognition of adverse conditions in the international market. The potential for
designing trading mechanisms at a later stage must be explored.
Cost effectiveness: The second criterion argues for the development of mechanisms that
ensure cost-effective mitigation. This must be ensured in the design of the mechanisms
by ensuring that mitigation is done at scale and with proper pricing of mitigation
options.
Donor coordination and avoidance of overlap with existing initiatives: Avoidance of
donor overlap and alignment with political priorities in Vietnam have argued for a
priority to be given, at this stage, to the solid waste sector and the steel sector, both to
be covered by the preparatory work in the design of baselines and MRV systems that
can be: supportive of a NAMA process; establish the basis for sector-wide crediting;
enable (in the case of steel) a potential move to a trading mechanism.
In addition to these factors, the Government of Vietnam has used the following criteria in its
appraisal of readiness and engagement with the PMR:
alignment with Vietnam’s Sustainable Development Strategy;
interest of stakeholders in the sectors;
experience with MBIs: to date, most experience with MBIs has been with CDM, which
has mostly focused on the power sector;
technical and MRV capacity: given the main driver of MRV capacity to date in GHG
measurement has been the development of CDM
3. Organizational Setup In order to respond to climate change challenges the Prime Minister approved in December
2008 the "National Target Program to Respond to Climate Change" (NTP-RCC), in which the
implementing organizations were listed. The tasks of the different bodies and ministries are
defined in the Working Regulation of the NCCC (Decision No 25/QD-UBQGBDKH, March 2012) as
well as in the NTP-RCC. The following Figure shows the overall organizational framework of the
41
key ministries involved in the Vietnamese GHG emission reduction activities with an optional
imbedding for the PMR-project.
Figure 9: Organizational Setup for the Development of the Market Readiness Proposal
Green: core organizations for MRP DMHCC: Department of Hydrology Meteorology and Climate Change (DNA under CDM framework) MARD: Ministry of Agriculture and Rural Development MOC: Ministry of Construction MOF: Ministry of Finance MOIT: Ministry of Industry and Trade MONRE: Ministry of Natural Resources and Environment MOT: Ministry of Transport MPI: Ministry of Planning and Investment NCCC: National Committee on Climate Change PMO: Prime Minister Office PMR: Partnership for Market Readiness PMU: Project Management Unit VNEEP: Vietnam Energy Efficiency Program
National Committee on Climate Change (NCCC)
The National Committee on Climate Change (NCCC) chaired by the Prime Minister has the
overall responsibility for climate change issues in Vietnam. Chairman of the NCCC is the Prime
Minister (PM). The permanent vice chairman is a Deputy Prime Minister, and the vice chairman
the minister of MONRE. Whereas the permanent vice chairman assists the PM on institutional
tasks, the vice chairman is responsible for technical aspects. The NCCC makes research proposals
responding to climate change requirements of the Government and the Prime Minister, assists
the PM in the coordination between ministries and agencies, and develops interdisciplinary
42
strategies and national programs concerning climate change and green growth projects.
Furthermore, the NCCC is the main institution for monitoring of climate change activities,
supervising on behalf of the PM the implementation of climate change policies and directing and
implementing all international cooperation activities. The NCCC is the responsible committee for
advising the Government and the PM on all issues concerning climate change policy in Vietnam.
Moreover, the NCCC is responsible for mobilizing and coordinating financial resources for
implementation of the proposed strategies and programs in order to effectively respond to
climate change.
Ministry of Natural Resources and Environment (MONRE)
MPI has primary responsibility for performing the function of State management over climate
change in Vietnam and is the focal point of UNFCCC. Based on the NTP-RCC, MONRE was
designated in the year 2008 as the lead agency to facilitate the development of the National
Climate Change Strategy. Moreover, MONRE has responsibilities concerning the implementation
of policies, the supervision of their progress, and in the formulation of MRV frameworks. The
GHG inventory is established under the lead of this ministry. The Department of Meteorology,
Hydrology and Climate Change (DMHCC) is the Designated National Authority (DNA) of Vietnam
and is the focal point for the CDM and for NAMAs. It supports the Government in the
management of carbon trading in the international context. MONRE is the lead ministry for the
implementation of the Project "Approval of Project of Greenhouse Gas Emission Management;
Management of Carbon Credit Business Activities to the World Market". One of the main
objectives in the mentioned decision is the formation of a domestic carbon market and the
participation in the international carbon market (Article 1, paragraph 1 b).
DMHCC is the office of NCCC, SPRCC, NTP-RCC.
Ministry of Finance (MOF)
MOF manages disbursements and recurrent expenditures of the whole state economy. MOF is
together with MONRE responsible for the mobilization and allocation of budgets to climate
change programs and projects and has the lead in reviewing and monitoring of budgets usage
for these activities. According to the organizational set-up of the Green Growth Strategy the
MOF with its primary functions of the management of state finances must "develop policies to
encourage all economic sectors, organizations and individuals to invest in development of the
green economy in Vietnam" (section IV, paragraph 3b).
Ministry of Planning and Investment (MPI)
MPI has primary responsibility for performing the function of State management over planning
and investment and directs the integration of climate change into the socio-economic national
and provincial strategies and programs. In this function MPI developed the Green Growth
Strategy of Vietnam. MPI coordinates with other ministries, People's Committees of Provinces
and cities, evaluates and reviews implementation of the strategies and reports to the PM
regularly. MPI cooperates closely with MONRE in mobilizing international donors for climate
43
change activities and collaborates with the MOF in advising the PM in budget allocation for the
activities in this sector. MPI approves all investment made by the Government of Vietnam based
on Investment Decision Documents (IDD) including also climate change investments.
Ministry of Construction (MOC)
MOC is inter alia the main entity responsible for the planning, designing and architecture of
urban development, building materials, and planning and construction of urban technical
infrastructure (including solid waste management).In Urban and rural solid waste management,
MOC has responsibilities on developing the Strategy, Programme, Orientation, Building Codes,
Standards, Regulations; developing the Policies, mechanisms for investment encourage (e.g.:
Cost norm for solid waste collection, transportations and treatments; Building and submitting
proposal to Prime Minister for approving the planning on solid waste management at regional
level such as Mekong Delta region; Design of Instructions/Guidelines for planning on solid waste
management at urban and provincial level).
Department of Science Technology and Environment (DSTE) is a focal point of MOC on NTP-RCC,
VSGG and VNEEP.
Ministry of Agriculture and Rural Development (MARD)
The MARD’s main functions are the state management in the fields of forestry, agriculture,
fishery, irrigation and rural development. Moreover, MARD is also the leading ministry for waste
management including landfills in rural areas.
Ministry of Industry and Trade (MOIT)
The primary function of MOIT is the state management of Industry and trade (defined in Decree
95/2012/ND-CP). Important industrial sectors such as oil and gas, industrial mining and mineral
processing and chemical industry are part of the MOIT. MOIT is also responsible for new
energies, renewable energies and the development of plans and programs for energy savings
and energy efficiency. The Decision on the "Target Program on Energy Efficiency and
Conservation Phase 2012 – 2015” (Ref: 1427/QD-TTg, October 2012) is to be implemented by
MOIT. The target is to achieve 5-8% savings of the total energy consumption of the country in
the period 2012 - 2015 compared to forecasted energy demand in the national electricity
development plan. It also includes energy intensity targets for key industrial sectors, e.g. steel
(see Decision 1427/QD-TTg of October 2012). MOIT will be the active counterpart of all NAMA
projects in the industrial or energy sectors.
Ministry of Transport (MOT)
The Ministry of Transport - MOT - is in charge of the nationwide state management of road,
railway, maritime and inland waterways, and aviation. MOT's main climate-changed related
responsibility is the formulation of new technological standards in all subsectors, e.g. standards
44
for all vehicle types. In 2005 transport caused around 10% of the national GHG emissions30 and
will become the second largest GHG emitter in 203031.
Ministry of Education and Training (MOET)
MOET is responsible for the education system in Vietnam. In this function it realizes awareness
rising activities on climate change and integrates this topic into the curriculum and teaching
aids. Moreover, MOET implements at research institutes of universities (e.g. INEST) climate
change topics. The latter thereafter support again the government with research and
investigation results.
Ministry of Science and Technology (MOST)
According to Decree No: 20/2013/ND-CP, article 1, MOST is a governmental agency which
performs functions of State management on science and technology, including science and
technology activities; development of science and technology potentials; intellectual property;
standards, metrology and quality control; atomic energy, radiation and nuclear safety; and State
management on public services in fields under the Ministry’s management as stipulated by law.
In the field of climate change MOST and its research institutes are responsible for investigating
new technologies and for monitoring facilities for adaptation of climate change impacts. MOST
organizes and plans the research activities in Vietnam and supports other line ministries with
know-how and integration of green technology.
PMR STRUCTURE As key drivers of climate change policy in Vietnam MPI and MONRE have been appointed as the
Vietnamese Focal Point for the Partnership for Market Readiness (PMR) program for the first
two phases. The Department for Science, Education, Natural Resources and Environment
(DSENRE under MPI), the Department of Meteorology, Hydrology and Climate Change (DMHCC
under MONRE) and the International Cooperation Department (ICD under MONRE) form the
preparation unit within these ministries. In the PMR Steering Committee the main ministries
involved in climate change are integrated (see figure above). For the third phase - the
implementation of the Market Readiness Proposal the organizational set-up will be adapted to
tasks of this phase (for details see BB 5).
30
DMHCC and JICA, 2005 National GHG Inventory Report 31
MPI/UNDP, A Marginal Abatement Cost Curve Analysis for the Energy Sector in Vietnam, Table 1, 2013, p.17
45
1. Target/Goal Setting and Relation to MBIs
Under the international agreement currently being negotiated and expected as an outcome of
the ongoing Ad Hoc Working Group on the Durban Platform, countries will be looking to provide
their “commitment” or “contribution” to the overall goal of the Convention over the coming
months. There are as yet no decisions on what forms these contributions may take, but it is
reasonable to assume that they will either be in the nature of quantified emission limitation
commitments or contributions, or as commitments to undertake some particular action (“policy
commitments”), such as feed-in tariffs or undertaking actions to avoid deforestation. Whatever
their shape, these will have to be reconciled with an information system that monitors the
implementation of the agreement and the achievement of stated goals.
Quantitative emission commitments are much more suitable for the development of emission-
based MBIs such as emission trading or sectoral crediting. Policy commitments, if restricted only
to the development of policy and not backed by emission quantification, do not provide a sound
basis for internationally traded units.
In general one can therefore assume as crucial links between the development of national
pledges and supportive MBIs, the following sets of relations:
a quantified, emission-related pledge and a clear definition of the boundary to which it
applies: is the pledge economy-wide or is it defined along sectoral lines? Without clear
boundaries, emissions inside and outside of the pledge may be double counted.
is the pledge a deviation from a baseline trend, a quantified increase/decrease from the
base period, or intensity-based (e.g. tCO2/GDP)? Quantified increases and decreases and
intensity targets provide a better system on which to build emission trading and
crediting systems. Deviations from baseline pledges raise extensive technical issues.
BUILDING BLOCK 3: CORE TECHNICAL AND INSTITUTIONAL /
REGULATORY MARKET READINESS COMPONENTS
1. Target/Goal Setting and Relation to MBIs
2. MRVs and Data Approaches
3. Registry/Tracking Tool and Linking
4. Objectives, Activities, and Proposed Budget
46
is the pledge a point-target or a trajectory-target? The latter may be seen as more
credible and raises fewer accounting issues.
does the pledge include the use of international or domestic offsets? How is the quality
of these offsets controlled? Are there limits to their use? Use of international units
presupposes a system to link up systems, such as a transaction log and possible
electronic registry systems to facilitate trading.
In the case of Vietnam, the policy system has already delivered on some of the questions related
to target-setting and can be deemed to be supportive of implementation of MBIs. In particular,
the National Target Program to Respond to Climate Change (NTP-RCC), the National Target
Program for Energy Efficiency (NTP-EE of Decision 1427), the Plan to Manage GHG Emissions and
the Green Growth strategy have a raft of headline numbers. These include those reviewed
already under the first Building Block and are presented below.
Table 7: Targets in Vietnamese Climate Change Policy
Targets for 2020
Reduce the intensity of GHG emissions by 8-10% as compared to the 2010 level.
Reduce energy consumption per unit of GDP by 1-1.5% per year.
Reduce GHG emissions from energy activities by 10% to 20% compared to the business as usual case. This commitment includes a voluntary reduction of approximately 10%, and an additional 10% reduction with additional international support.
Targets for 2030
Reduce annual GHG emissions by at least 1.5-2%.
Reduce GHG emissions in energy activities by 20 to 30% compared to business as usual. Of this commitment, the voluntary reduction will be approximately 20%, and a 10% is dependent on additional international support.
Targets for 2050
Reduce GHG emissions by 1.5-2% per year.
There is however a number of shortcomings in relation to some of these targets, in particular in
relation to intensity targets, as they raise issues in relation to the estimation of GDP figures but
most importantly to the credibility of baseline emission projections that may underpin the core
targets. In turn, the viability of marketable units being based off these targets becomes more
difficult to ascertain. In other words, if MBIs are to be based on the characteristics of existing
pledges, clarity will need to be sought on the following:
assumptions underlying baseline projections for emission intensity targets;
assumptions on emission trajectories;
47
assumptions on types of international support (credited vs. non-credited support);
coverage of emission targets (e.g. including full scope of IPCC activities).
2. MRV and Data Approaches
2.1. Overview Figure 10: Approaches to Data for MBIs
2.2. Top-down MRV Approaches
In general, supporting either crediting or trading systems will require or at least be helpfully
assisted by a strong top-down system of compilation and elaboration of national emission
statistics. In particular, two important systems must be taken into account: the system that
accounts for national/sector emissions, usually translated into a periodic national inventory of
GHG emissions, and the national system of energy statistics, usually resulting in the periodic
publication of energy statistical yearbooks and the national energy balance.
These two top-down approaches to data gathering are important in deriving some key
parameters that underline most emission reduction programs, namely parameters such as grid
emission factors, other activity emission factors, baselines and projections for activity data and
consequentially emissions. In complement to these top-down data approaches, participation in
different types of market mechanisms, in particular the Clean Development Mechanism and
similar voluntary initiatives can at least provide a country with the capacity for bottom-up
development of the required data sets for use in new MBIs. What follows therefore is a revision
of Vietnam’s readiness in relation to both top-down and bottom-up data approaches.
Building a National Inventory System
As a developing country Party to the Climate Change Convention, Vietnam prepared to date two
national communications which present a summary of Vietnam’s climate change policies and
48
are a convenient starting point for the analysis of Vietnam’s capacities and data gaps.
Greenhouse gas inventories for these national communications have been prepared as the
product of projects with support from international organizations and no organizational system
or official institution arrangement has been established for these activities, making it difficult to
compile data regularly keeping their quality, especially on time-series consistency.
Table 8: Major Changes from the Initial to the 2nd National Communication of Vietnam to the UNFCCC
Source: Cuong, Vietnam National Communication Report, presentation to the 9
th Workshop on GHG
Inventories in ASIA, Phnom Penh, 2011
The comparison between the first and the second national communications reveals some effort
in overcoming essential data gaps for some sectors. In both national inventories, the lack of
specific calculation of emission factors leads to an over-reliance on default emission factors
(IPCC ones), which may not correctly reflect the national circumstances of Vietnam.
Furthermore, in almost all cases, calculations were made using the most aggregate of
methodological tiers, implying the most simplified calculation method. This over-reliance on Tier
1 methods is easily justifiable by the lack of depth in the exercise, given the ad hoc nature of the
elaboration of the first two national inventories.
The Government of Vietnam, through MONRE, has entered into a major project with the
support of the Japanese International Cooperation Agency, for the development of its own
national greenhouse gas inventory system. This project is still ongoing and will culminate in the
development of Vietnam’s BUR in mid-2014, along with a proposal for the organizational
framework for the national greenhouse gas systems (see Box 2).
Database (activity data & emission factors) was improved and archived in the Department of Meteorology, Hydrology and Climate Change DMHCC (MONRE);
Key sources categories were analysed;
Uncertainty estimates were carried out at a macro-level (15%);
Documentation of sector budget support for agricultural sector was prepared;
Some surveys to develop local emission factors e.g. in rice cultivation, coal mine methane fugitive emissions were realized;
Compilation of the technical report on GHG inventories for 2000
49
Nevertheless, it remains that in its current form, and given that the system above is yet to be
translated into a legal framework, Vietnam lacks still the ability to produce systematically high
quality aggregate data on emissions. In turn, this implies that underpinning any proposed MBI
should be, at least in its initial stages, a reliance on bottom-up MRV systems and experience.
2.3. Bottom-Up MRV Experience Most MBIs rely on bottom-up based market-based instruments such as the Clean Development
Mechanism or emission trading schemes such as the European Emissions Trading Scheme (EU
ETS) have adopted a project- by-project or installation-by-installation approach which does not
heavily rely on a centralized data gathering system. Instead, monitoring, reporting and
verification guidelines have been issued and performance is measured in each of these systems
at unit level, rather than system level.
There are obvious benefits to the implementation of a decentralized approach: parts of the
covered sectors deemed to be in a more ready state can more immediately engage with the
market, allowing for earlier participation of sections of the intended covered sectors. Moreover,
BOX 2: The Proposed National Inventory System
Core elements include:
primary role given to inventory preparation to MONRE and within it, to DHMCC;
inclusion of defined focal points in line ministries;
establishment of a longer-term permanent expert advisory board on methodologies;
provision of estimation, uncertainty assessment and quality assurance and quality
control procedures.
The oversight responsibility of the GHG inventory preparation process has been assigned to
the Department of Meteorology, Hydrology and Climate Change (DMHCC) under the
Ministry of Natural Resources and Environment (MONRE).
The Vietnam Institute of Meteorology, Hydrology and Environment (IMHEN) and the
Vietnam Environment Administration (VEA) (both departments within MONRE) jointly
undertook the emission estimation, quality control, and the preparation of the reports with
support from the JICA experts. National consultants collected the activity data and the
Institute of Strategy and Policy on Natural Resources and Environment (ISPONRE) designed
the national system proposal for GHG inventory preparation.
The additional increased capacity will increase the reliability of essential parameters in
particular for any instrument based on national or sectoral data along the sectoral
definitions within the IPCC national inventory guidelines. Moreover, data underscoring
baseline projections may well in future be mined directly from the national system.
50
capacity in relation to both monitoring but also verification and even reporting can more easily
be built on the back of existing experiences such as the CDM or the verification system for the
Lotus standard (in the building sector) or even the ISO standards, commonly applied, also in
Vietnam.
The drawbacks to such implementation of bottom-up approaches relate to the need
nevertheless to develop at a central level common set of standards to be applied, and the
requirement for enforcement, usually through the use of third-party accredited verifiers.
Nevertheless, again the experience with the Clean Development Mechanism (reviewed in BB1)
and other standards may help, in several ways:
Adoption of similar protocols to existing ones allows for the use of the existing
infrastructure. Similarly to what has been achieved by China through its CCER program,
Vietnam could choose to use existing CDM, VCS or other standards as the basis for their
proposed programs. Nevertheless, such adaptation requires legal and technical
expertise in relation to adapting the protocols to existing conditions in Vietnam.
Unless Vietnam wholesale imports the existing standards, which may not be appropriate
given specificities it may wish to introduce into its own application of the standards, it
will need to develop its own accreditation scheme. This implies the development of an
accreditation standard (such as the one developed for the CDM or the many developed
in relation to ISO certification) and the setup of a number of institutions:
o A central accreditation institution: This could build on the experience of the
Vietnamese Designated National Authority under the CDM, but would require
specific expertise in relation to the accreditation requirements (such as
technical expertise or financial viability analysis).
o Accreditation of independent verifiers: There is now in the Southeast Asia region
a large number of companies/institutions which may provide verification
standards, including those actively engaged in the CDM or in the Crown
Standard in Thailand. Vietnam may also want to foster the development of
home grown capacity in the field.
At the same time, adoption of existing approaches to MRV should also facilitate future
coherence with other international initiatives which may facilitate potential link-up with other
systems. The size of any potential Vietnamese carbon market is relatively small (in a global
context). Vietnam should therefore monitor ongoing developments in the international field in
relation to either new market mechanisms or framework for various approaches” (under the
UNFCCC) or independent initiatives such as the Globally Networked Carbon Markets initiative of
the World Bank.
51
2.4. Conclusion on MRV MRV systems for the proposed sectors in BB4 will have to rely on the adoption of existing
bottom-up approaches, adapting existing protocols and standards (e.g. of the CDM) to the
Vietnamese reality.
3. Registry/Tracking Tool and Anticipating Linking
Whether for trading or crediting systems, most legislators and policymakers will want to have a
device that:
tracks the property of any rights/assets issued or generated from an MBI;
provides security of transactions;
provides for eventual linking of any schemes to other national or international schemes,
while avoiding double counting with existing initiatives;
ensures compatibility of the market-based instrument with the overall policy goal.
Most existing carbon markets are underpinned by an emission registry system and a “double
entry” book-keeping structure, in which on one side of the ledger units are issued (onto a
registry system), and on the other side, emissions are registered in an inventory (or in the case
of covered entities in an emission trading system, in verified monitoring reports).
Existing registry systems are very scheme-specific as they all provide effect to different
functionalities specified by the legislator. In other words, it is simply not possible to wholesale
import the registry of an EU ETS into another scheme, for example. Nevertheless, a number of
useful elements exist that assist developing countries looking to develop their carbon market
instruments in an effective way. In particular, the developments under the international system
of data exchange standards which are “open source” provide one avenue for the beginning of
development of such systems (some of the Chinese systems have used these DES for their own
pilot scheme). In addition, cooperation between trading systems can lead to potential access to
the non-protected parts of the intellectual property.
Vietnam should assess the need and requirements for a registry infrastructure on an on-going
basis. Crediting mechanisms do require some centralized registry system, in particular to keep
track of issuance of units, and in order to reconcile issuance and international transfer of units
with accounting for any national commitment (i.e. subtracting sales of credits from achievement
of any particular quantified commitment). As Vietnam moves up the readiness ladder and
prepares more complex interaction with the international carbon market, such as the potential
for a cap-and-trade system in selected sectors, Vietnam will need to take care that decisions on
the registry setup early on do not compromise its ability to trade later, without further
adaptation to emerging international norms. In particular, discussions on linking international
markets have to date been dominated by political issues (such as the impact of specific rules in
52
both markets on allocation methods and pricing behaviour) but also by technical issues (such as
the issue of which data exchange standards to take up in designing electronically linked
systems). Some specific recommendations follow on the development of the national registry:
monitor international developments in relation to international standards;
provide for best practice in terms of registry account security;
from the outset, choose a registry architecture that builds on existing or emerging
standards (such as the data exchange standards for the Kyoto Protocol registry system);
test thoroughly the system and all its functionalities before going live;
ensure through the registry system the tracking of emission units and the avoidance of
double counting (for example from ongoing CDM and future “crediting NAMA” actions;
devise a change management system, so that each next step in registry development
(adding more functionalities) is done at minimum risk to existing trading entities.
4. Objectives, Activities, and Proposed Budget (Component 1)
Through this component, the GoV will facilitate future development of carbon pricing policy
approaches, including MBIs through a focus on evaluating carbon pricing options for Vietnam
and assessing and developing the technical, policy and management tools available to the GoV
for MBI implementation.
Task 1 and 2 thereby are important for establishing the institutional market readiness. Whilst
various NAMAs are being developed by various donors, there exists a gap in having an overall
strategic direction and positioning of the GoV in the usage of NAMAs and eventually crediting
NAMAs and which MBIs are most appropriate within the Vietnamese context. Therefore it is
envisaged to assess in detail the role of MBIs in NAMAs with a special focus on crediting NAMAs
under the chair of MONRE (ID 1) whilst relating them to domestic and international financial
mechanisms under the chair of MPI (ID 2). This overall framework is considered as essential to
ensure a coherent approach and a consistent strategy for the components such as MRV,
baselines, data collection, registry etc.
ID Objective/ Subcomponent
Activity PMR Budget
53
1
Evaluate carbon
pricing
approaches and
assess
requirements
for introducing
MBI(s) in
Vietnam
Evaluate MBIs for the formulation and implementation activities of NAMA, especially credited NAMAs in Vietnam (chaired by MONRE). This includes:
a). Conduct an overview research of MBIs and evaluate some mitigation MBIs that are being implemented around the world.
b). Research and evaluate potential MBI(s) that can be
applied for NAMA, especially credited NAMA in Vietnam.
120,000
2 Research and formulate of mechanisms and financial
policies and measures to establish and operate a
MBI(chaired by MPI)
150,000
3 Research and develop data collection and management systems for the operation of MBI (chaired by MONRE). This includes:
a). Develop a data collecting model; propose data structure and data management systems.
b). Develop a technical map for mitigation activities.
100,000
4 Stakeholder training on carbon pricing approaches (chaired by MONRE). This includes:
a). Develop technical training programs at three levels: (i) central, (ii) sectors and (iii) local levels on requirements for MBIs and credited NAMA readiness.
b). Perform dissemination, awareness raising about responsibility for implementing GHG emission reduction and inventory, and the content of the proposed credited NAMAs at all levels, sectors, localities, communities and businesses.
250,000
5 Research and develop roadmap for implementing MBI and application of MBI(s) in Vietnam (chaired by MONRE)
50,000
6
Assess the institutional and regulatory framework for implementation of MBIs in Vietnam
Develop strategies for the development of domestic markets and a carbon trading system for international markets (chaired by MONRE). This includes:
a). Assess core elements required for the establishment of domestic carbon markets and a carbon trading system for a potential international market.
b). Review legislation, organizational structure of credited NAMA management and carbon credits generated from credited NAMAs in Vietnam.
c). Analyse and identify barriers, limitation in organizational structure and current policies for the development of MBIs in Vietnam.
210,000
54
7 Assess criteria and processes for crediting NAMAs in Vietnam (chaired by MONRE). This includes:
a). Identify necessary factors for the measurement, reporting and verification (MRV) of activities that generate carbon credits.
b). Identify standards and procedures for issuing carbon credits.
c). Propose a process to register, grant, withdraw and exchange carbon credits.
220,000
TIMELINE
ID Activity Responsible Agency Time Required Completion
1 Evaluate MBIs for the formulation and implementation activities of NAMA, especially credited NAMAs in Vietnam (chaired by MONRE). This includes:
a). Conduct an overview research of MBIs and evaluate some mitigation MBIs that are being implemented around the world.
b). Research and evaluate potential MBI(s) that can be applied for NAMA, especially credited NAMA in Vietnam.
MONRE 12 months Year 1
2 Research and formulate of mechanisms and financial policies and measures to establish and operate a MBI (chaired by MPI)
MPI 24 months Year 2
3 Research and develop data collection and management systems for the operation of MBI (chaired by MONRE). This includes:
a). Develop a data collecting model; propose data structure and data management systems.
b). Develop a technical map for mitigation activities.
MONRE 24 months Year 2
55
4 Stakeholder training on carbon pricing approaches (chaired by MONRE). This includes:
a). Develop technical training programs at three levels: (i) central, (ii) sectors and (iii) local levels on requirements for MBIs and credited NAMA readiness.
b). Perform dissemination, awareness raising about responsibility for implementing GHG emission reduction and inventory, andthe content of the proposed credited NAMAs at all levels, sectors, localities, communities and businesses.
MONRE 24 months Year 3
5 Research and develop roadmap for implementing MBI and application of MBI(s) in Vietnam (chaired by MONRE)
MONRE 24 months Year 3
6 Develop strategies for the development of domestic markets and a carbon trading system for international markets (chaired by MONRE). This includes:
a). Assess core elements required for the establishment of domestic carbon markets and a carbon trading system for a potential international market.
b). Review legislation, organizational structure of credited NAMA management and carbon credits generated from credited NAMAs in Vietnam.
c). Analyse and identify barriers, limitation in organizational structure and current policies for the development of MBIs in
MONRE continuous Year 3
56
Vietnam. 7 Assess criteria and processes
for crediting NAMAs in Vietnam (chaired by MONRE). This includes:
a). Identify necessary factors for the measurement, reporting and verification (MRV) of activities that generate carbon credits.
b). Identify standards and procedures for issuing carbon credits.
c). Propose a process to register, grant, withdraw and exchange carbon credits.
MONRE continuous Year 3
The total PMR budget for component 1 is USD 1,100,000.
See for details Annex 1.
57
1. Overview of the Sector
1.1. Current Status Information of the VSA and Ministries as well as of the MOIT indicates that the overwhelming
number of steel mills is organized in the VSA. The UNIDO study as well as the AFD study have
examined thereby in detail the structure of the Vietnamese steel market. The Vietnamese steel
industry is currently still dominated by SOEs – however the participation of the private sector is
increasing due to the appearance of new private steel companies and through the establishment
of private-public equity in the Vietnam Steel Corporation group of companies. This change from
SOEs to privately owned companies is also supported by the National Target Programme on
Energy Efficiency and Conservation32. The program stresses (e.g. chapter III. Program Funding
Plan Period 2012 - 2015) that investments shall be funded to an important extent (roughly 50%)
by international organizations and foreign countries. International co-operation shall be
improved as well.
The UNIDO report realized a comprehensive survey of the VN steel sector. The in-depth survey
was carried out among a representative sample of privately and public owned companies
including large and small companies. A recent report supported by AFD (available as draft
version) is a very comprehensive study on the entire steel sector in Vietnam. It has a larger data
base and more detailed and disaggregated data than the UNIDO report. Specific energy
consumption is – despite the uncertainties of the studies – very similar in both studies i.e. both
reports show a pretty identical picture of the VN-steel sector. Also the AFD report estimates the
improvement potential of energy efficiency in the VN steel sector between 5 and 30%, which is
the same order of magnitude as presented in the UNIDO report. The report also states, that
more detailed analysis’ have to be made (not only based on questionnaires) to identify, where
(with which equipment) the improvement can be realised. Due to the comprehensive
questionnaire inquiry the AFD data are more elaborated and thus represent an improved data
base for developing the concrete mechanism and the final data of the MBI. It presents
extensively potential improvement technologies/measures, which could be applied in the VN
steel industry.
32 Decision on Approval of National Targeted Program on Energy Efficiency and Conservation Phase 2012 – 2015,
Decision No. 1427/QĐ-TTg
BUILDING BLOCK 4a: PLANNING FOR A MARKET-BASED
INSTRUMENT IN THE STEEL SECTOR
58
The Figure below relates ownership and energy efficiency based on the UNIDO report. There is a
clear trend that private companies tend to be more energy efficient: nine of the ten most energy
efficient Vietnamese plants are privately owned. But it is also true that the two least efficient
plants are privately owned.
Figure 11: Specific Energy Consumption of Vietnamese Steel Mills Depending on Ownership
Source: J. Herbertson, Energy and Resource Efficiency in the Vietnamese Steel Industry, 2011
Relating size with current energy efficiency status no conclusive results can be drawn looking at current results. However as shown further on smaller plants do have a limited potential to implement GHG efficient technologies. Vietnamese steel output in 2010 (latest data) is around 7 million tonnes produced steel,
whereas installed capacity (VSA, pers. comm.) is at roughly 11 million tonnes. Thus capacity
utilization was 65%. Sub-utilized production lines are less efficient than those under nominal
production.
Vietnam currently follows the blast furnace (BOF) route for iron making and the electric arc
furnace (EAF) route for steel production. Vietnamese blast furnaces have limited capacity.
According to AFD33 the total design capacity of installed blast furnaces runs up to about 600,000
tons per year. The production in 2010 was 500 000 tonnes of pig iron34. At this small scale, the
application of advanced technologies is limited. The currently installed technology is
characterised by the key figures (compared to best values) shown in the following Table.
Table 9: Key Figures of Vietnamese Pig Iron Production
Parameter Vietnam World Japan
Production per day in tons 50-800 2,000-12,000 9,000
Coke consumption, kg/t 650 – 1,100 350 – 450 378
Pulverized coal injection rate, kg/t 0 - 40 100 – 200 120
Life of furnace, years 7 – 8 14 – 15 25
Source: Nguyen Van Sua, Production and technology of steel industry in Vietnam, 2011, Table 2.1
33
Results of the survey-questionnaire of iron and steel sector industry in Vietnam.AFD et al 2013 34
Nguyen Van Sua, Production and technology of steel industry in Vietnam, 2011
59
Specific consumption of coke and coal of the Vietnamese small blast furnaces lies between 35%
and 120% above the world standard. The lifetime of the Vietnamese furnaces is roughly twice the
world standard. This is directly related to the small capacity or size of the blast furnaces used.
Steel production in 2010 was 4.8 million tons of ingot steel on the EAF (Electric Arc Furnace) route.
The following table relates the Vietnamese steel production parameters with world class values.
Table 10: Key Figures of Vietnamese Steel Production
Parameter Vietnam World
Furnace capacity, t/tap 9 – 70 50 – 300
Tap to tap time, min./tap 60 – 160 45 - 70
Electricity consumption, kWh/t 420 – 750 320 – 500
Electricity consumption, GJ/t 1,51 – 2,7 1,15 – 1,8
Electrode consumption, kg/t 2,6 – 6,0 1,5 – 3,5
Source: Nguyen Van Sua, Production and technology of steel industry in Vietnam, 2011, Table 2.2
A UNIDO study35 indicates significantly higher values of electricity consumption, however also
the international benchmark is put higher. According to its authors the values have been
modelled and then gathered and confirmed (‘face to face’) on site by the experts. The following
Figure displays the specific energy consumption of the 18 EAFs in Vietnam.
Figure 12: Electricity Consumption of Vietnamese Steel Production, EAF Production
Source: J. Herbertson, Energy and Resource Efficiency in the Vietnamese Steel Industry, 2011
The average specific energy consumption is approx. 3 GJ/t, while the world best practice is
between 2.1 and 2.4 GJ/t. Consequently, the Vietnamese specific energy consumption lies
roughly 1/3 above the world good practice range. However around 50% of the plants are within
that international good practice range.
35
J. Herbertson, Energy and Resource Efficiency in the Vietnamese Steel Industry, 2011
60
1.2. Output Projections The Master Plan for the steel industry for the 2007-2015 period, with the 2025 vision36 aims at
developing the Vietnamese steel industry into an important industry with advanced technologies.
The planned growth until 2020 is an increase of the installed production capacity by a factor of 2.7
p.a. concerning pig iron manufacturing, an increase of 16% p.a. in billet steel (raw steel)
manufacturing, and an increase by 15% p.a. in finished steel products. The focus of the master
plan is on investment cooperation with foreign countries/companies for the manufacturing of pig
iron, ingot steel and flat steel products. The Master Plan states that the relations between steel
companies and R&D agencies and domestic and foreign universities shall be improved in order to
transfer new technologies and techniques to the steel industry. It also states that environmental
pollution shall be minimized; for that purpose newly built plants shall apply modern and advanced
technologies and shall comply with minimum requirements concerning production volumes.
Outdated technologies and machines shall be renovated and gradually eliminated.
1.3. GHG Emissions Within Energy, Manufacturing Industries and Construction have 24 MtCO2e, i.e. industry accounts
for roughly 20% of total GHG emissions excl. LULUCF37 and 24% of energy related GHG emissions.
Within industrial processes not surprisingly mineral products i.e. cement production represents
the largest part with metal production accounting for 0.9 MtCO2e. The following chart shows the
distribution between industrial sectors of energy emissions (excludes industrial process emissions).
Figure 13: GHG Emissions per Industrial Sector of Energy-Related Emissions in Vietnam 2005
Source: DMHCC and JICA, 2005 National GHG Inventory Report, 07/2013, Table 19 (not official, provisional data)
36
“Decision approval of steel manufacturing and distribution system development planning by 2020 with a vision to
2025”. No.694/QD-BCT. Hanoi, January 31, 2013 37
See Table 4 of document cited in Figure 1
61
Iron and steel which are included as a sector in this report account for 4% of industrial energy
based GHG emissions or around 1% of total GHG emissions excl. LULUCF equivalent to 1.9
MtCO2 in the year 200538. Industry also consumes large amounts of electricity. However, due to
the UNFCCC inventory structure, GHG emissions associated with its electricity use are not listed
under the “Industry” heading but under “Energy Production” i.e. taking a production- and not a
consumption-approach to carbon accounting. Assigning the relevant part of electricity use to the
steel sector would yield much higher figures. In the steel sector, direct GHG emissions depend
on the consumption of natural gas and fuel oil respectively. Indirect GHG emissions, i.e. GHG
emissions stemming from related electricity use on the carbon factor of electricity generation.
Thus, future GHG emissions from the steel sector will be influenced by:
The future production volume;
The specific gas and fuel consumption. This value depends on the efforts of the steel
sector to improve energy efficiency in the thermal area. Also the size of the installation
and the growth of the sector is an important factor of the specific fuel consumption.
High growth rates lead to new production facilities which use state-of-the-art
equipment and high production volumes justifies large production plants with their
economies of scale and lower specific energy consumption. The specific gas
consumption influences the GHG emissions of the steel sector directly;
The specific electricity consumption. This value depends on the same factors as listed
above plus the carbon factor of electricity production in Vietnam, which is outside the
scope of influence of the steel companies. Therefore GHG emissions from the sector can
only be influenced partially through mitigation undertaken in the sector itself.
The following graph shows a BAU projection for the year 2030 realized in a World Bank study.
Figure 14: BAU Projections GHG Emissions Steel Sector 2015-2030 (MtCO2)
Source: World Bank, Vietnam 2030, Charting a Low Carbon Development Path for Vietnam, Draft report, 2014
38
Includes iron and steel process emissions
62
Disclaimer: This is a provisional and not yet approved report; Data as presented in this report might be incorrect due to the provisional nature of the report; all figures and data shown from this report shall thus be considered as indicative. This is not an update of the Decision 694/2013 on the Steel Master Plan.
1.4. Rationale for Sector Focus Iron and steel accounts for 4% of industrial energy-based GHG emissions or around 1% of total
GHG emissions excl. LULUCF equivalent to 1.9 MtCO2 in the year 2005. In addition, the steel
sector is one of the largest electricity consumers in Vietnam.
The Law on Energy Efficiency and Conservation39establishes the overall framework on energy
conservation. In October 2012 within this framework the National Target Programme (NTP) on
Energy Efficiency and Conservation Phase 2012 – 2015 was approved40. This NTP includes
targets for energy savings, measured in relation to BAU projections of energy use for the period
2012-2015 and energy intensity targets – in the particular case of steel, to reduce the average
energy consumption for the production per ton of steel components from 179 kgoe in 2011 to
160 kgoe by the year 2015. The Green Growth Strategy further states specifically the steel sector
and has as goals to improve effectiveness and efficiency of energy use, reduce energy
consumption in production activities, transportation and trade; Innovate technologies, applying
advanced management and operation procedures for efficient and effective use of energy in
production, transmission and consumption, in particular in large production facilities where
energy consumption is high.
In July 2011 the Green Industry Task Force (GITF) was established at the Vietnam Steel
Association (VSA), consisting of 27 members from the government (Office of the Government,
MOIT, and MONRE) and all Electric Arc Furnace (EAF) steel mills. The task force has developed a
GI (green industry) roadmap for the steel sector including technical measures. It shows a
potential for reducing energy consumption up to 2015 by 10-12%, and further 5-8% by 2020.
This led to a voluntary agreement among GITF’s members aiming at a 10% reduction in raw
materials consumption and energy inputs per ton of steel, compared with consumption in 2011.
Due to its high energy consumption and the concentrated nature of the sector, with a limited
amount of facilities, the steel sector is a prominent sector in most Emission Trading Systems
(ETS). The establishment of a MRV system for this sector can thus also be an important stepping
stone towards a broader carbon market design for Vietnam.
Above elements provide the rationale for focusing on the steel sector as the sector is important
in terms of GHG emissions, has significant abatement options, is a GoV priority sector for GHG
reduction measures, has created already a voluntary emission reduction target and is an apt
sector for MBI with wide international experience.
39
National Assembly, 17/06/2010 40
Decision 1427/QD-TTg of 02/10/2012
63
2. Designing the Crediting Programme for the Steel Sector
2.1. Data Management and MRV The UNIDO report realized a comprehensive survey of the VN steel sector. The in-depth survey
was carried out among a representative sample of privately and public owned companies
including large and small companies. The limited amount of companies in this sector allows for a
relatively simple data collection. If a focus is put on the large share of GHG emissions and output
the amount of companies involved is even more reduced. This simplifies significantly data
collection, management and MRV. The Law of Energy Efficiency and conservation also mandates
all energy intensive companies41to report their consumption annually and to formulate5-year
action-plans to reduce energy intensities reporting the results to MOIT through the EE office.
The specific GHG emissions, the energy consumption (by energy carrier) as well as the
production volume have to be monitored. The division gives the specific energy consumption.
With a standardised conversion factor from energy to CO2 the specific CO2 emissions can be
calculated. Quality assurance can be done the following way:
Fuel metering must be done with gauged meters;
Production must be weighted with gauged balances;
Data must (if possible) be electronically transferred to a process management system. If
transfer by hand: quality control by standardised procedures.
Data verification can be reduced to checking the certified gauging reports and assuring correct
data transfer.
In principle therefore MRV is simple. The problem is not so much the complexity of the data but
the complexity to get accurate and trustworthy data. Producers will not be willing to share this
information and have no incentive to provide correct and accurate data. Rather they have an
incentive to overstate energy usage and to inflate energy costs due to tax reasons as well as in
hindsight of any future energy or GHG obligations. Therefore the core issue will not be on
technical aspects but on creating an incentive system, which allows for high quality data with
independent and external verification. The CDM created such an incentive structure. A voluntary
association agreement without financial incentive is probably too weak to create enough of an
incentive to actually get high quality, reliable and externally verified data. A NAMA with financial
transfers could be capable of providing sufficient incentive to report reliable data especially if
this is verified externally by 3rd Parties.
41
The Intensive entities are defined by the annex of Prime Minister Decision 1294/QD-TTg on 1st August 2011 with the criteria of all entities consuming over 1000 TOE/year. The Decision is currently being revised to set the benchmark at 5.500 TOE but no final decision has yet been taken.
64
2.2. Baseline Setting To calculate the specific GHG emissions, the energy consumption has to be captured (by energy
carrier) as well as the production volume. The division gives the specific energy consumption.
With a standardised conversion factor from energy to CO2 the specific CO2 emissions can be
calculated.
A crediting baseline describes the contribution of companies to reduce GHG emissions
compared to a BAU scenario. The GHG emissions are the product of production volume and
specific GHG emissions of steel companies. As the activity level cannot be influenced
significantly the baseline is constructed around an intensity level i.e. GHG emissions per output
unit. This parameter does not depend entirely on the steel industry as the CO2 factor electricity
influences the GHG emissions of the steel sector (indirect emissions). However, this could also
be factored out by calculating a crediting baseline with a constant CO2 factor for electricity.
For simplification reasons the baseline development is only valid for medium and large steel
companies. They stand for the predominant amount of GHG emissions. Small companies are of
secondary importance concerning GHG emissions. They will also have restricted possibilities to
invest in better and new technologies and will have higher specific emissions due to lack of
economies of scale. Therefore they will also play a minor role when implementing a MBI.
Figure 15: Schematic Diagram of a Baseline
SEC: Specific Energy Consumption; Source: Authors’ calculation
65
Various types of Baselines can e.g. be defined and calculated e.g.:
Static Baseline: this baseline focuses on current practices. It is assumed that current
inefficient practices continue if no incentive apart from energy savings exists. In this
scenario it is assumed, that e.g. the currently closed voluntary agreement of the Green
Industry Task Force (GITF) will be realised, but no broad activities to increase energy
efficiency take place in the steel sector. Sporadic measures to reduce the specific energy
consumption are implemented. This corresponds to the situation as faced currently by the
steel sector in Vietnam. Under such a Baseline the current or historic SEC would be kept
constant.
No-regret baseline: It is assumed that efficiency measures in general are implemented.
This assumes that all so-called no-regret measures with negative abatement cost are
implemented42. Whilst not all no-regret measures will be implemented even with a MBI
latter can create the financial incentive to price carbon and therefore to implement more
low-cost measures. However this will be conditional upon a stable regulatory framework
and also stable carbon pricing conditions. Such a stable framework was not provided by
the CDM therefore resulting also into only limited additional investments, especially in this
sector.
Benchmark baseline world standard i.e. the Vietnamese steel production would have
efficiency levels compared to standard or even best international practice. In this scenario
the steel sector would consolidate, i.e. small, inefficient steel mills would disappear.
Figure 16: Baseline SEC Levels 2010-2025 for EAF Production (Baseline SEC Levels are Adjusted Based on Production Capacity) for electricity and energy usage
42
In practice most probably most of the measures have positive abatement costs but barriers or hidden
costs have not been monetized.
66
700
720
740
760
780
800
820
840
860
880
900
- 5'000 10'000 15'000 20'000 25'000 30'000 35'000 40'000 45'000
SEC [kWh/t]
capacity kt/yr
avg SEC EAFcurrent practice
avg SEC EAFno regret
avg SEC EAFint'l bmk
2.50
2.60
2.70
2.80
2.90
3.00
3.10
3.20
3.30
3.40
3.50
- 5'000 10'000 15'000 20'000 25'000 30'000 35'000 40'000 45'000
SEC [GJ/t]
capacity kt/yr
avg SEC EAFcurrent practice
avg SEC EAFno regret
avg SEC EAFint'l bmk
Source: Authors’ calculation Energy intensity is dependent on the production capacity i.e. many technologies can only be
implemented on a viable base with a certain production size. The trend towards larger steel mills
will therefore lead automatically also to reduce energy intensities and will also reduce the
baseline.
A standardized baseline approach might be viable for the steel sector. However the progress of
the UNFCCC in approving standardized baselines has been poor. Therefore the approach for a
67
NAMA might be structured around a standardized baseline developed outside the UNFCCC
process.
2.3 Abatement Options and Mitigation Goals Currently, the steel industry is not working at full capacity. Thus efficiency is sub-optimal. Better
loading of the production lines will increase efficiency without requiring technical measures.
According to projections and planning, steel production will increase remarkably within the next
years. Therefore the assumption is made, that in a first phase the existing production lines will be
used at full capacity. In a second phase and partially in parallel, new capacities will be installed.
Specifically on the EAF route, small companies produce at a lower efficiency than medium or large
scale companies. In recognition of this fact, the “Law on Energy Efficiency and Conservation” states
that existing installations have to be modernised and equipment with outdated technologies must
be replaced. New production capacities must follow some major requirements, i.e. they must have
at least an indicated size and follow international efficiency standards.
In July 2011 the Green Industry Task Force (GITF) was established within the Vietnamese Steel
Association VSA, consisting of 27 members from the government (Office of the Government,
MOIT, and MONRE) and all EAF steel mills. The task force has developed a GI (green industry)
roadmap for the steel sector including technical measures. It shows a potential for reducing
energy consumption up to 2015 by 10-12%, and a further 5-8% by 2020. This led to a voluntary
agreement among GITF’s members aiming at a 10% reduction in raw materials consumption and
energy inputs per ton of steel, compared with consumption in 2011. Currently, the initiative has
been accepted and adopted by 2 companies. VSA is in the process of convincing further companies
to sign the voluntary agreement.
Numerous studies have been carried out which hint at potentials to increase energy efficiency in
the steel industry. In general the findings are that the Vietnamese steel sector can reduce
considerably energy usage with well-known measures and better operational practices. An
example at Da Nang Steel (EAF plant) shows, that a reduction of the specific energy consumption
by slightly more than 20% is feasible with only a limited amount of measures43. The iron and steel
sector of Vietnam is presently dominated by the Small Steel Producers (SSP) using mainly EAF
technology for steel production from scrap steel and iron ore. However due to limited scrap
availability globally, future capacity expansions in the iron and steel sector are expected to come in
blast furnace route (BF). A recent World Bank study identified numerous negative or low marginal
cost abatement44 measures in the steel industry as listed in the following Table and Figure. The
abatement options in this report have been selected both for existing SSPs (i.e. options that can
43
The study proposes among others to install an improved tapping system and a system to pre heat feed with hot off
gases. J. Herbertson, Energy and Resource Efficiency in the Vietnamese Steel Industry, 2011 44
The World Bank MAC are based on: Costs include capital expenditures (CAPEX), operating and maintenance expenditures (OMEX) and fuel expenses (FUELEX). All costs are expressed in 2010 USD and discounted to 2010 using a social discount rate of 10.0%. Emissions are expressed in metric tons of CO2eq over the lifetime of the Low Carbon Option (LCO) alternative up to 2030. MACs are expressed in USD/tCO2 reduction provided by the LCO.
68
reduce the energy demand of small scale units) and also for the upcoming steel plants coming
under the BF route.
Table 11: Abatement Potentials and MACs Steel Sector Vietnam
Measure Mitigation potential
cumulative 2010-2030 in MtCO2e
Marginal Abatement Cost
in USD/tCO2e
Iron and Steel
Coke Dry Quenching 1.80 -3.05
BFG, COG based power generation 21.41 -58.50
Heat Recuperation from Hot Blast Stoves 0.49 -0.79
Sinter plant heat recovery 3.08 -3.78
BOF gas sensible heat recovery 4.09 3.44
Natural gas injection in BF 2.89 -8.88
Pulverized Coal Injection (PCI) in Blast Furnace 2.90 -8.30
Thin Slab Casting (TSC) and Strip Casting (SC) - two main types of near net shape casting 16.75 4.46
Hot Charging in Rolling Mill 2.91 2.89
Installation of the Top Pressure Recovery turbine 2.48 -48.56
Variable Speed Drives in steel making 0.06 -56.60
Small Steel Producers
Oxyfuel burners 0.62 -23.80
Eccentric Bottom Tapping (EBT) 0.14 3.66
Scrap Preheating (FUCHS) 2.45 -36.96
Bottom Stirring 0.40 -39.08
Transformer efficiency improvement 0.61 -56.15
Improved process control 1.97 -61.44
Source: World Bank, Vietnam 2030, Charting a Low Carbon Development Path for Vietnam, Draft report,
2014
Figure 17: Marginal Abatement Cost Curve Iron and Steel Producers (2010-2030)
69
Source: World Bank, Vietnam 2030, Charting a Low Carbon Development Path for Vietnam, Draft report,
2014
3. MBI for the Steel Sector
3.1. SWOT Analysis The following Table summarizes the strengths, weaknesses, opportunities and threats (SWOT) in
relation to implementation of market-based instruments in the steel sector in Vietnam.
Table 12: SWOT Assessment of MBI in the Steel Sector
Strengths
Alignment with country´s Green Growth Strategy;
Objectives and targets on emission intensity have been laid out;
Provision for utilization of market-based - instruments for GHG emission management in existing legislation;
Voluntary target agreement for energy reduction has been realized;
Limited number of sources;
Data quality and data availability good;
Emissions abatement options have been identified.
Weaknesses
Limited experience in the use of market based instruments (no registered CDM project in the sector);
Inexistence of a structured MRV for the sector;
70
Opportunities
Gained know-how on new technologies for GHG reduction in the sector;
Bilateral agreements with other countries for GHG emission trading (ex: Japan);
Gain know-how and information for other sectors on MBI for a future domestic cap-and-trade market.
Threats
Uncertainty in global climate negotiations and consequently in the demand for credits generated through an MBI;
Limited awareness of the benefits of MBI;
Difficulty in engagement of the private sector as incentives are not attractive enough to provoke change;
Low growth levels and sector stagnation with the resulting sub-utilization of production capacities can create barriers towards investments.
Overall it is considered that the sector offers good opportunities for the implementation of MBI.
3.2. Roadmap Concerning MBIs for the Steel Sector The Vietnamese steel sector consists of 91 steel producing companies. The majority of
companies are members of the Vietnamese Steel Association (VSA).
The following activities have been identified for MBI, along an axis of time:
1. Until 2015 the core elements of a NAMA will be designed in coordination with the UNDP
steel NAMA;
2. 2015-2020: Implementation of a pilot crediting NAMA and preparation for the next
stage;
3. Cap-and-trade system for the steel sector.
Figure 18: Activities for MBIs in Steel Sector in Vietnam
The NAMA can be well tied together with the voluntary target of the VSA as a domestic
mitigation component (the NA of the NAMA) and an international offset sold under a crediting
NAMA. The MRV can be built up and the baseline be well defined. Participation would be
71
voluntary. The experiences gained with a NAMA on baseline setting and an MRV are core pre-
requisites for the establishment of a future cap-and-trade system in this sector.
3.3. Institutional and Legal Arrangements The following Figure shows how the working group of the PMR is integrated in the steel sector.
Figure 19: Institutional Structure of the Working Group Steel Management
The Law on Energy Efficiency and Conservation mandates energy users to economically and
efficiently use energy. The state sets minimum energy yield levels for energy-consuming
equipment. The law took effect on January 1, 2011. The following table resumes important
aspects of the law for the steel sector.
Table 13: Law on Energy Efficiency and Conservation and Steel Sector
Reference Contents
Art. 5 The government commits to provide financial support and other necessary incentives to promote economical and efficient use of energy.
Art.9 Industrial producers shall apply standards etc. on energy use provided by competent state agencies. They shall select and apply advanced production management processes/appropriate technological measures / equipment / technologies with high energy yield.
Art. 10 Industries shall modernize production lines and replace equipment with outdated technologies and low energy yield.
Art 33-36 Major energy users (the steel industry being one of them) shall implement plans on economical and efficient use of energy; they shall appoint professional energy managers. Once every three years, a compulsory energy audit is to be conducted. The state of energy use shall be regularly examined.
Art 41 Defines incentives for the economical and efficient use of energy including incentives on import and export duties, enterprise income tax, concessional loans and others.
72
Art 45 The Ministry of Industry and Trade shall organise a national energy database system.
Source: Law on Energy Efficiency and Conservation. No. 50/2010/QH12. Hanoi, June 17, 2010
The Decision on “Approval of the national master plan for power development for the 2011 -
2020 period”45 defines the development of the electricity sector. In Art 1 the decision requires
to “gradually apply the recommended and compulsory measures to encourage innovation of
technology and equipment of the power-intensive industries (steel, cement, chemicals); limit
and then ban import of old equipment with low efficient rates of production and energy use.”
Further to the Law on the Economical and Efficient Use of Energy and as mentioned before, the
National Target Programme on energy efficiency and conservation Phase 2012-2015”46 sets a
target for the steel industry of reducing the average energy consumption for the production of
one ton of steel components from 179 kgoe47 in 2011 to 160 kgoe in 2015. In particular, the NTP
‘s “Project 2: Development and dissemination of high-performance, energy-saving equipment,
gradual phase out of low-performance equipment” focuses on the steel sector.
Finally, the Master Plan for the steel industry for the 2007-2015 period, with the 2025 vision48
aims at developing the Vietnamese steel industry into an important industry with advanced
technologies. The planned growth in the period 2007 until 2025 is 36% p.a. concerning pig iron
manufacturing, 16% of increase in billet steel (raw steel) manufacturing, and 15% p.a. in finished
steel products. The plan lists the necessary investment per plant and period as well as the type
of investment. The focus of the master plan is on investment cooperation with foreign
countries/companies for the manufacturing of pig iron, ingot steel and flat steel products. The
Master Plan states that the relations between steel companies and R&D agencies and domestic
and foreign universities shall be improved in order to transfer new technologies and techniques
to the steel industry. It also states that environmental pollution shall be minimised; for that
purpose newly built plants shall apply modern and advanced technologies and shall comply with
minimum requirements concerning production volumes. Outdated technologies and machines
shall be renovated and gradually eliminated.
All of the elements below provide evidence that a concise regulatory framework exists which
promotes energy and GHG intensity reductions in the Vietnamese steel industry.
3.4. Objectives, Activities, and Proposed Budget (Sub-Component 2.1) Donor Coordination
45
Decision on approval of the national master plan for power development for the 2011 - 2020 period with the vision
to 2030. Ref: No. 1208/QD-TTg, Hanoi, 21 July 2011 46
Decision on approval of national targeted program on energy efficiency and conservation phase 2012 – 2015. Ref:
1427/QĐ-TTG. Hanoi, 02 October, 2012 47
kgoe stands for kg oil equivalents. The conversion factor is 1 kgoe = 11.63 kWh. kgoe sums up the use of all energy
carriers, i.e. oil, gas, electricity etc. 48
Decision on approval of the master plan on the development of Vietnam’s steel industry in the 2007-2015 period,
with the 2025 vision taken into consideration. No.145/2007/QĐ-TTg. Hanoi, September 04, 2007
73
The core actor currently with comparable activities and objectives is UNDP which has a
programme to realize a NAMA in the steel sector (implementing agency Industrial Safety
Techniques and Environmental Agency (ISEA) of MOIT) with the focus on a MRV system in
accordance with international standards such as the CDM. The project does not intend to
develop a crediting NAMA i.e. is focused on creating support structures for implementation of
nationally appropriate mitigation actions. The UNDP NAMA will develop however baselines, a
MRV structure and other important elements. The PMR will support and complement this
NAMA with piloting activities, database registry system, and the preparation towards a cap-and-
trade system for a future domestic ETS and capacity building of involved stakeholders. The
activities described here are therefore considered as complementary to the UNDP ones.
Coordination will be realized through regular meetings to have clarity on the scope of activities
on both sides and to ensure that activities are complementary, consistent and not overlapping.
This is facilitated by having for both programs the same implementing agency. Also regular inter-
action with the Steel Association VSA allows for identifying and coordinating activities which are
directly realized with VSA or their members under the header of climate change. On a broader
scale the program will inform the donor community at its regular meetings of the on-going
activities and will take stock of new or planned donor activities within the steel sector.
Coordination responsibility lies thereby primarily with the implementing agency ISEA.
The steel sector was selected due to its high energy consumption and the feasibility of
implementation, noting the concentrated nature of the sector as there are a limited amount of
facilities in Vietnam. The sector also has significant identified abatement options and has been
identified by the Government as a priority sector for GHG reduction measures. The data
management and reporting for both sectors will be developed by the line ministry (MOIT), in
consultation with MONRE, as the focal point on NAMAs of the Government. The policies
developed as part of Component 1 for data management will help ensure all the relevant data
are collected, reported, and archived properly in a systematic and consistent way to facilitate
the integration of data into sectoral and national MRV systems. It is important to note that the
impact of an MBI on price responsiveness and, therefore, GHG emissions, may be limited by the
sectors’ highly regulated nature, and as such, the success of MBIs will be partially reliant on
complementary structural measures to enhance the implementation and achievement of policy
goals through MBIs.
The design of the crediting NAMA will be built up according to the following methodological
framework
Guiding objectives: defining the objectives of the credited NAMA
Definition of scope and scale: defining the GHG emissions, sectors, and technologies to be targeted by the credited NAMA
Governance: roles and responsibilities of institutions involved in the credited NAMA
74
Rules and procedures: rules and procedures that guide the operation of the credited NAMA
Baseline setting and definition of the crediting approach: elements for quantification of emission reductions generated by the credited NAMA activities
MRV: the procedures for monitoring, reporting of emissions and quantified emission reductions
Data management and registry: data management and infrastructure to transparently account for program activities, achieved emission reductions and any transfer/use of credits from the credited NAMA.
ID Objective/ Subcomponent
Activity Budget PMR
8
Design a pilot credited NAMA for the steel industry49
Design and develop a pilot data and reporting system to enable the measurement of GHG emissions in the steel industry (chaired by MOIT). This includes: a). Initial review the current data management system used to collect energy consumption in the steel industry. b). Develop data collection form for the MBI operation in the steel industry. c).Develop a comprehensive and consistent data management, reporting and verification systems of GHG emissions in the steel industry. d). Perform additional duties in accordance with the review results in the update and synchronize research that relevant to the NAMA implemented in the steel industry.
200,000
9 Capacity building for stakeholders involved in the implementation of MBI(s) in the steel industry (chaired by MOIT). This includes: a). Training and workshop to evaluate potential opportunities to undertake MBI(s) in the steel industry. b). Workshop to evaluate reports for MRV and GHG emission databases in the steel industry. c). Training and capacity building for the management agencies of the MRV system, operations and management carbon credit in the steel industry.
120,000
10 Development of design of some elements of credited NAMA and pilot reporting on a voluntary basis for steel industry (chaired by MOIT) This includes: a). Initial evaluation and identification of the steel companies participating in the pilot voluntary reporting
300,000
49
Overall objective; activities are limited to those that are complementary to the UNDP steel NAMA
75
system. b). Development of an institutional structure with specific policies for the reporting and verification systems. c). Development of the reporting procedures for the various types of data and activities in the steel industry as well as the verification methods, procedures, and organizational structures needed for verification work within the sector. d) Evaluation and identification of accredited agencies to verity the reporting of emissions. e). Research and analysis of necessary components to potentially establish an emission trading system in the steel industry. f). Workshop to consult and evaluate implemented results.
11 Research and analysis of necessary components to establish the trading carbon market in the steel industry (chaired by MOIT). This includes: a). Analyze and assess the basis to establish the trading carbon market in the steel industry. b). Research and propose solutions to establish and facilitate the trading carbon market in the steel industry. c). Study mechanisms to attract voluntary participation of steel companies to participate in the carbon market.
170,000
TIMELINE
ID Activities Responsible Agency
Time Required Completion
8 Design and develop a pilot data and reporting system to enable the measurement of GHG emissions in the steel industry (chaired by MOIT). This includes: a). Initial review the current data management system used to collect energy consumption in the steel industry. b). Develop data collection form for the MBI operation in the steel industry. c).Develop a comprehensive and consistent data management, reporting and verification systems of GHG emissions in the steel industry. d). Perform additional duties in
MOIT continuous Year 3
76
accordance with the review results in the update and synchronize research that relevant to the NAMA implemented in the steel industry.
9 Capacity building for stakeholders involved in the implementation of MBI(s) in the steel industry (chaired by MOIT). This includes: a). Training and workshop to evaluate potential opportunities to undertake MBI(s) in the steel industry. b). Workshop to evaluate reports for MRV and GHG emission databases in the steel industry. c). Training and capacity building for the management agencies of the MRV system, operations and management carbon credit in the steel industry.
MOIT 2 years Year 3
10 Development of design of some elements of credited NAMA and pilot reporting on a voluntary basis for steel industry (chaired by MOIT) This includes: a). Initial evaluation and identification of the steel companies participating in the pilot voluntary reporting system. b). Development of an institutional structure with specific policies for the reporting and verification systems. c). Development of the reporting procedures for the various types of data and activities in the steel industry as well as the verification methods, procedures, and organizational structures needed for verification work within the sector. d) Evaluation and identification of accredited agencies to verity the reporting of emissions. e). Research and analysis of necessary components to potentially establish an emission trading system in the steel industry. f). Workshop to consult and evaluate implemented results.
MOIT 1 year Year 3
11 Research and analysis of necessary components to establish the trading
MOIT 3 years Year 3
77
carbon market in the steel industry (chaired by MOIT). This includes: a). Analyze and assess the basis to establish the trading carbon market in the steel industry. b). Research and propose solutions to establish and facilitate the trading carbon market in the steel industry. c). Study mechanisms to attract voluntary participation of steel companies to participate in the carbon market.
The total PMR budget for sub-component 2.1 is USD 790,000.
See for details Annex 1.
78
1. Overview of the Sector
1.1. Current Status The per capita urban waste generation was 1.1 kg/head/day in 200550 with a 15% increase year
on year51. Using these figures, per capita waste generation for year 2012 is estimated as nearly 3
kg/head/day. The total waste generated in urban Vietnam was estimated at nearly 30 Mt for
201252. For rural Vietnam53 the per capita waste generation is estimated to be around 1
kg/head/day54. Total waste generated in rural Vietnam is therefore around 22 Mt in the year
2012. Former estimates used for National Communications to the UNFCCC had far lower
estimates of the per-capita waste generation (around factor 3 lower estimated for the 2nd
National Communication to the UNFCCC) thus also resulting in far lower total solid waste
production and the corresponding GHG emissions. Solid waste generation in urban and rural
areas has also been estimated in the National GHG Inventory Report 2005 of Vietnam (JICA,
2013). The estimation presented used the waste generation per capita factor presented in the
Second National Communication (0.7 kg/person/day for urban areas for the year 2005). The fact
that different statistical sources55 indicate hugely different rates of urban municipal solid waste
generation poses a challenge for the calculation and forecast of the volume of urban solid
wastes in Vietnam, and correspondingly to any baseline construction exercise for an MBI.
Information on the average composition of residential waste is presented in the National GHG
Inventory Report 2005 of Vietnam (JICA, 2013) and in the Figure below. According to the
information presented, the majority of waste is composed by rapidly degrading items such as
food/organic waste.
50
MONRE, 2005.Bao Cao Hien Trang Moi Truong Vietnam– Phan Tong quan (State of the Environment Report - Overview), Ha Noi, Vietnam 51
E&Y on behalf of the World Bank, Greening the waste sector in Vietnam, draft report 2014 52
Based on urbanization rate of 32% with a total urban population of 28 million for the year 2012. 53
MONRE, National State of Environment Report 2011 on Solid Waste 54
The assumption is used that the rural per capita waste generation is 2-3x less than the urban waste generation. 55
MOC estimates that solid waste amount in December 2013 in the urban area of Vietnam (770 cities) is around 11.5 Mio tons per year (resp. 31,500 t/d)
BUILDING BLOCK 4b: PLANNING FOR A MARKET-BASED
INSTRUMENT IN THE SOLID WASTE SECTOR
79
Figure 20: Average Composition of Residential Waste Streams
Source: National GHG Inventory Report 2005 of Vietnam (JICA, 2013), based on status environment reports of Department of Nature Resources and Environment of Provinces
Further information on waste composition can be gleaned from a more recent report published
as part of a Japanese-Vietnamese NAMA feasibility study in the waste sector (JICA, 2013).
Overall results as presented in the following table are broadly consistent with the ones
presented in the National GHG Inventory Report 2005 of Vietnam.
Table 14: Average Composition of Residential Waste Streams
Class Type of waste Share (%)
Slowly degrading waste Paper waste 5.2
Textile waste 3.2
Wood/straw waste 3.3
Moderately degrading waste Other non-food organic putrescible /garden and park waste
0.0
Rapidly degrading waste Food waste/sewage sludge 63.9
Other non-degradable wastes 24.4
Source: Preliminary Results of Joint Study Project in Vietnam – Waste Sector, IMHEN, OECCC, MOEJ, 2013
Waste collection has been improving in the cities and, on average, 71% of waste is collected in
urban areas (MONRE, 2011). Nevertheless, the waste collection rate in rural areas is still no
more than 20%, according to the Second National Communication. More recent data56 estimates
that approximately 80-82% of municipal solid waste is collected.
The current situation of solid waste treatment technologies in Vietnam is as follows (MONRE;
2011):
56
“Preliminary Results of Joint Study Project in Vietnam – Waste Sector” (IMHEN, OECCC, MOEJ, 2013)
80
458 dumping sites in the country, 73.5% of which considered not hygienic;
20 lines to treat organic wastes into compost with funding from ODA projects;
Some low capacity incinerators manufactured by domestic enterprises; incinerated in
cement clinker kilns.
Pyrolysis and industrial briquette making, while in a research phase has been researched and
manufactured at domestic companies. However, the level of mechanical manufacturing is
referred as low and the enterprises have not received support from the authorities and financial
institutions.
There is contradictory information in different documents in relation to the actual number of
disposal sites. Regarding landfills, the abovementioned report “Preliminary Results of Joint
Study Project in Vietnam – Waste Sector” (IMHEN, OECCC, MOEJ, 2013). The National State of
Environment Report 2011 - Solid waste (MONRE, 2011) refers to 98 operating landfills in major
cities, only 16 of which meet sanitation requirements.
According to MOC there are 458 dumping/disposal sites in operation, whereas 337 are
unsanitary sites. The unsanitary sites are mostly temporary, open-air, no system to collect and
treat leakage water. These sites cause air pollution, soil, and water contamination. There are
about 26 combined treatment plants in urban areas with a total capacity of approximately
5,000tons per day. Technologies in this multi-treatment systems are: combustion technology -
incinerator; combination of incinerator and compostingor most common composting combined
with landfills.
Table 15: Solid Waste Management of Hanoi, Da Nang and Ho Chi Minh City
No Cities Municipal Solid waste generated -
MSWG(ton/day)
Collection of MSWG(ton/day)
Collection rate of
MSWG(%)
Landfill (ton/day)
Composing (ton/day)
Incinerator (ton/day)
1 Ha Noi 5,370 4,195 78.1 3,680 95 420
2 Da
Nang
760 650 85.5 650 - -
3 Ho Chi Minh
6,800 6,800 100 3,600 3,200 -
Total 12,930 11,645 90.1 7,930 3,295 420
Whole country
31,500 26,460 84.0
Source: MOC
Information on the amount of urban solid waste disposed in landfill sites is presented in the
National GHG Inventory Report 2005 of Vietnam (JICA, 2013) for each province in Vietnam.
Hanoi and Ho Chi Minh City provinces together contribute to around 50% of the total urban
solid waste disposed in landfill sites in Vietnam.
81
1.2. Output Projections Based on the 2012 waste generation estimate57, projections have been made to for the quantity
of solid waste to be generated by 2030. However this projection has some important caveats:
The starting base is an estimate of the per capita urban waste generation of 1.1
kg/person for the year 2005 plus an assumed annual growth rate of 15%. The number
used of 1.1 kg/day is already challenged by other sources using a rate of 0.7 kg/day. The
authors of the projection then assume linear increase until the year 2030 of the per-
capita waste amount resulting in a per-capita waste rate of 6.7 kg/person which seems
highly unrealistic. This figure is e.g. more than triple of the current waste per capita
generation of Americans58.
The rural waste generation is based on a simple relation urban-to-waste based on a
parameter assumed and not measured.
In short a more realistic projection would probably result in less than 50% of the recent
projection made by E&Y on behalf of the World Bank. However it can be clearly said that solid
waste amounts will increase significantly over the next 2 decades in Vietnam. The current
database is nevertheless very weak and does not adequately support the development of a solid
baseline projection.
Figure 21: Municipal Solid Waste Projections Vietnam
0.00
20.00
40.00
60.00
80.00
100.00
120.00
140.00
160.00
180.00
MSW generat ion-Urban
Vietnam E (06) Ton
MSW generat ion-rural
Vietnam E (06) Ton
Total Solid Waste
generat ion E (06) Ton
Municipal Solid Waste projections - Urban & Rural
Years
Source: E&Y on behalf of the World Bank, Greening the waste sector in Vietnam, draft report 2014
57
E&Y on behalf of the World Bank, Greening the waste sector in Vietnam, draft report 2014 58
http://www.epa.gov/waste/nonhaz/municipal/
82
1.3 GHG Emissions Total GHG emissions in 2000 in Vietnam amounted to 150.9 million tonnes of CO2 equivalent
(tCO2e), of which 7.9 million tCO2e came from waste (including solid waste and also
wastewater), which represented 5.3% of total GHG emissions including LULUCF in the year
200059. The main contributor to the waste GHG emissions is solid waste with around 70%.
Moving beyond 2000, the recent exercise in estimating emissions for the national inventory of
2005 has yielded a total volume of waste-related emissions for 2005 of 8.12 MtCO2e. This value
is similar with the one reported in the SNC for the year 2000. However within the waste sector,
the contribution by source reported is quite different, with the main source of emissions coming
from domestic wastewater, instead of solid waste (see following Figure). In fact, reported GHG
emissions from solid waste disposal sites are reported 59% lower in the National GHG Inventory
Report 2005 of Vietnam when compared to Vietnam´s Second National Communication for 2000
not due to GHG emission reductions but to changes in estimates made and accounting.
Figure 22: Share of Waste-Related GHG Emissions in 2005
Adapted from: National GHG Inventory Report 2005 of Vietnam, JICA, 2013 These results, in particular the reported decrease in emissions from waste disposal sites have
been explained by the national inventory team, as resulting from several factors, namely:
Application of First Order Decay (FOD) method (i.e. moving from tier 1 to tier 2);
Updating the amount of urban solid waste disposed in landfill site based on data from each provincial report;
Application of waste composition data from each province (based on survey in each province);
59
Second National Communication to the UNFCCC on Climate Change (MONRE, 2010)
83
Updating MCF (Methane correction factor) value in urban area based on new assumption (0.77 -> 0.52);
Updating DOCf (Fraction of degradable organic carbon dissimilated) value based on Good Practice Guidance 2000 (0.77 -> 0.50).
However, and as recognized by the previously cited report “Preliminary Results of Joint Study
Project in Vietnam – Waste Sector” (IMHEN, OECCC, MOEJ, 2013) and also in the National State
of Environment Report 2011 - Solid waste (MONRE, 2011), the increase in the amount of solid
waste generation which has been verified in recent years is expected to continue in the future
due to both the continuous rapid industrialization and urbanization of the country and the fact
that open dumping and burning remain widespread in the landfill sites of the country. Using
data from solid waste disposed in each municipality in 2009, two business-as-usual (BAU)
scenario projections to 2030 were presented in the report. The first scenario considers an
annual growth rate of solid waste in Vietnam of 10% (based on the recent trend of increase in
waste generation outlined in the 2011 National Environment Report); the second considers a
much lower annual growth rate of solid waste in Vietnam of 3.27%, and bases this number on
research conducted more recently60. The scenarios yield estimates of GHG emissions from solid
waste sector of around 17 million tCO2e in 2020 and 46 million tCO2e in 2030, in the first case,
and the second scenario estimates GHG emissions from solid waste sector around 9.4 million
tCO2e in 2020 and 13.6 million tCO2e in 2030. These projections, as the project is specific to
landfill technology, only account for the solid waste disposed in landfill sites. This information is
presented in the following Figure.
Figure 23: Solid Waste-Related BAU Emission Scenarios
0
5
10
15
20
25
30
35
40
45
50
2009 2010 2015 2020 2025 2030
milliontCO2e
Scenario 1 (10% annual growth rate) Scenario 2 (3.27% annual growth rate)
Source: Adapted from report Preliminary Results of Joint Study Project in Vietnam – Waste Sector, IMHEN,
OECCC, MOEJ, 2013
60
Research paper by the National Institute for Environmental Studies – NIES from Japan in 2010
84
A recent projection from E&Y for the World Bank61 has much higher emissions from the solid
waste sector with 48 MtCO2e for the year 2020 and 94 MtCO2e for the year 2030. Therefore GHG
emission projections for the year 2020 range between 9.4 and 48 MtCO2e and for the year 2030
between 14 and 94 MtCO2e i.e. a difference of nearly factor 7. This is a clear indication that
serious data gaps exist in this sector which needs to be closed if MBIs shall be implemented.
1.4. Organization of the Solid Waste Management Sector At the bottom of the hierarchy, collection, transportation, and disposal of waste is currently
managed by the municipal government, contracted through Urban Environment Companies
(URENCO). These are semi-public entities under the supervision of the People’s Committee.
There are currently 90 URENCOs in operation in Vietnam62. These entities are responsible for the
entire waste collection, treatment or final disposal in each jurisdiction and report to the People’s
Committees, usually through annual management reports. Operation of the URENCOs is meant
to be paid contractually on the basis of waste stream volumes. Nevertheless, and at central
level, there is not much information on provincial and municipal operations63.
In 2007, the Government of Vietnam approved the new Decree on Solid Waste Management
(Decree No. 59/2007/ND-CP). This Decree establishes the rights and obligations of entities
engaged in solid waste activities and structures of the waste management system for Vietnam.
The Decree establishes an entire system of waste management including as its main features a
new data collection system. MOC has issued the Circular 06/2012/TT-BXD on October 10, 2012,
which defines the reporting frequency including criteria of solid waste management.
The database concerning solid waste is in fact collected by DOCs and DONREs and data is
collected annually by MOC. However, data management including collection, data
sharing and database is limited: data are lacking, of low-reliability and of low accuracy.
The reporting capacity is limited. and differs much between DOCs and DONREs.
Figure 24: Overall Hierarchy of Solid Waste Management System
61
E&Y on behalf of the World Bank, Greening the waste sector in Vietnam, draft report 2014 62
Preliminary Results of Joint Study Project in Vietnam – Waste Sector, IMHEN, OECCC, MOEJ, 2013 63
MONRE, personal communication
85
The Integrated Solid Waste Management (SWM) strategy details the task assignment amongst
ministries in relation to the solid waste management system, with the overall coordination
tasked to the Ministry of Construction. The strategy also highlights the critical role of the
provincial and local People’s Committees in implementing Decree No.59/2007/ND-CP.
The solid waste management system, despite its centralized planning structure and the
centralized nature of the target-setting exercise, is in fact highly decentralized in its actual
implementation. Furthermore, many local and provincial People’s Committees, using their
powers from the 2007 law, have been able to advance with new financing and equity structures
with assistance of private and foreign capital. At the same time, specific earmarked taxes or
charges are left to these provincial structures and it is unclear to what extent these have been
effectively put in place, despite the formal adoption of the polluter-pays principle. The actual
operation of solid waste disposal sites and of collection systems is left finally to Urban
Environment Companies (URENCOs), which have different structures and which function at
arms’ length from the People’s Committees themselves.
This entire policy structure, while formally advanced, implies many shortcomings in relation to
data collection and the implementation of the requisite systems for MRV in relation to SWM for
a market-based instrument. As confirmed by an internal assessment of the GoV itself, one of the
main challenges of the sector is not the absence of waste management strategies, plans and
policies but the existence of too many mechanisms, strategies, plans and projects with
objectives and effectiveness which have not been evaluated in practice. Whereas a SWM system
has been established and developed with relatively detailed principles, the high number of
agencies involved in solid waste management (Ministries of Natural Resources, Construction,
Trade and Industry, Health, Agriculture and Rural Development, Planning and Investment,
Finance, Science and Technology) is recognized as one of the main challenges of the sector64.
1.5. Institutional and Legal Arrangements In 2007, the Government of Vietnam approved the new Decree on Solid Waste Management
(Decree No. 59/2007/ND-CP). This Decree establishes the rights and obligations of entities
engaged in solid waste-related activities and structure the waste management system for
Vietnam; in particular the Decree establishes the following guiding principles for waste
management:
the polluter pays principle: organizations and individuals that discharge solid waste or
generate solid waste are to pay for the collection, transportation and disposal of their
waste;
separation at source and waste hierarchy: where feasible, waste is to be reused,
recycled processed and all useful input materials reused or used for energy generation;
64
Solid Waste Management Policies – Challenges and Needs of Vietnam´s current situation (Ministry of Construction,
2013)
86
avoidance of landfilling: prioritizing technologies that avoid hard-to-decompose solid
waste and that may help reduce the volume of waste (due to scarcity of available land
for landfilling).
These principles are in line with most advanced waste policies in developed jurisdictions and
represent a milestone in policy development. This planning system is to be funded by either
state outlays or earmarked budget funds for solid waste management planning work. More
importantly, investment in upgrading the solid waste management system, essential given the
need for upgrading was deemed to be possibly funded by a variety of sources and financial
structures, including through business cooperation contracts, BOT (Build Operate Transfer), BTO
(Build Transfer Operate), equity investment in operating firms, bond issuance and securitization.
This encouragement in the law denotes a new openness to non-traditional sources of finance
and a more extensive role for both private and foreign owned participation in the sector.
Following this important decree, the GoV then went on to produce a National Strategy for
Integrated Management of Solid Waste up to 2025 and vision towards 2050 approved on 17th
December 2009 by the Prime Minister (Decision No.2149/QD-TTg), which sets specific objectives
for solid waste management for several horizons (2015, 2020 and 2025), namely in terms of
collection and recycling rates for urban and rural households. The document sets a very
ambitious vision to 2050, stating that by that time all forms of solid waste will be collected,
reused, recycled and treated completely by advanced technologies which are environmentally
friendly, customized for different locales and reduces the need for the land filling of waste to a
minimal level.
Table 16: Integrated Waste Strategy Objectives
Waste streams Percentage collection and treated in an environmental manner
Percentage recycled
2015 2020 2025 2015 2020 2025
Urban household SW 85% 90% 100% 60% 85% 90%
Construction waste 50% 80% 90% 30% 50% 60%
Sludge 30%65/10%66 50%/30% 100%/50% - - -
Rural areas 70% 70% 90% - - -
Source: Decision No.2149/QD-TTg
The Integrated Solid Waste Management (SWM) strategy goes on further to detail the task
assignment amongst ministries in relation to the solid waste management system, with the
overall coordination tasked to the Ministry of Construction. The strategy also highlights the
critical role of the provincial and local People’s Committees in implementing Decree
No.59/2007/ND-CP, in particular in relation to “promulgating specific incentive policies in
relation to solid waste management at different localities; developing, issuing and organizing the
implementation of procurement or ordering mechanisms for solid waste collection, transport
and treatment; instructing at-source sorting of solid waste; consolidating the organization of and
65
grade 2 cities 66
smaller cities
87
arrangements for renewing state enterprises serving public interest within the area; organizing
the monitoring, investigating and enforcement of strict punishments for violations in relation to
solid waste management; and, develop propaganda for raising awareness regarding the
responsibilities of organizations and individuals in relation to sound solid waste management
and the environment within their area.”
Finally, following the initial 2007 Decree and the 2009 Strategy, the GoV went on to establish a
long-term investment program in Solid Waste Treatment, which, beyond confirming the tasks
amongst ministries, further highlights the requirements in terms of capital and the proposed
financing sources. The Program tasks the Provincial and local Committees with proposing
investments to the Ministry of Finance and the Ministry of Construction on an annual basis,
along with funding requirements.
1.6. Solid Waste Sector Experience with MBIs CDM EXPERIENCE
In total there are 6 registered CDM projects in the waste sector in Vietnam. Three of the
registered projects are based on landfill gas recovering (according to ACM0001) with electricity
generation and flaring (see Table below).
Table 17: Registered CDM Projects Methane Recovery Landfills67
Reg. No
Registration Date
Project Name
Projected ERs (pa)
Issued CERs
Comments
1910 17/01/2009 Dong Thanh Landfill Gas CDM Project in Ho Chi Minh City
147,618 0 The landfill is closed since 2002. Test methane recovery was very little; therefore, no investment was made68.
1913 25/11/2009 Phuoc Hiep I sanitary Landfill Gas CDM project in Ho Chi Minh City
132,351 0 Project activity has not yet been implemented
3733 16/10/2010 Landfill gas recovery and utilization in Nam son, Tay Mo landfills in Hanoi
373,696 105'87369
Biogas recovery is only partial; electricity generators have not been implemented. Achieved ERs are around 24% of projected ERs. Methane recovery and the CDM project are currently stopped due to financial problems.
67
As of 12/2013 68
Information obtained from DONRE HCMC 69
2 Monitoring Periods over total 14 months
88
Source: UNFCCC database; comments based on inquiries to project owners of the authors
There are also 3 registered projects based on aerobic composting of the organic waste fraction
of the urban solid waste using the CDM methodology AM0025.
Table 18: Registered CDM Projects Aerobic Composting70
Ref. No
Registration Date
Project Name Projected ERs (pa)
Issued CERs
Comments
5556 06/06/2012 Avoided methane emissions through aerobic composting at Vietstar MSW treatment facility
181,492 0 50% of capacity implemented. Monitored ERs are currently 12% of projected ERs. With full capacity ERs will double71.
6680 18/07/2012 Cu Chi MSW Treatment Plant in Ho Chi Min City, Vietnam Project
158,727 0 Started operations 1 year ago, but is still in the testing phase; ERs not yet monitored72.
7330 29/11/2012 Avoid methane emissions through aerobic composting at Tan Thanh SW treatment plant
31,220 0 Project activity due to financial problems not yet implemented73.
Source: UNFCCC database; comments based on inquiries to project owners of the authors
Only one registered landfill methane recovery project has been actually implemented although
two of the projects were registered when carbon prices were still high. Emission reductions are
far below projected levels also in the only implemented project due again to only partial activity
implementation. Of the three composting projects only one is currently operational but also
with much lower than expected emission reductions. These results are however not uncommon
for waste management projects under the CDM which often have projections which far exceed
actual emission reduction levels and which also have often serious implementation problems.
Following conclusions can be drawn concerning the Vietnamese CDM experience in the waste
sector:
Vietnam was able to gather initial experience with a MBI in the CDM including the
preparation of an adequate baseline as well as a MRV structure;
Institutional and financial issues have hampered severely project implementation which
has been low;
Even relatively high carbon prices are not a sufficient stand-alone incentive to promote
implementation of activities in the waste sector;
70
As of 12/2013 71
Information obtained from Project Participant Southpole Inc. 72
Information obtained from DONRE HCMC 73
Information obtained from Project Participant Southpole Inc.
89
Projections tend to be far too optimistic or rely on models and assumptions which do
not correspond to the Vietnamese context therefore resulting in actual emission
reductions which are only a fraction of expected ERs.
NAMAs
Following NAMAs are currently being prepared that have an impact on the waste sector (see
following Table).
Table 19: NAMAs in the Waste Sector in Vietnam
Name Status Involved Entities
Capacity Building Cooperation and Joint Study Project for NAMAs in a Measurable, Reportable and Verifiable (MRV) Manner in the waste sector
Preliminary results of a potential NAMA: Introduction of Semi-aerobic landfill technology presented on June 2013; Currently, IMHEN is cooperating with OECC to implement Phase II of the project. Key activities of Phase II include: (i) information collection on technologies; (ii) data and information collection for BAU and NAMA; (iii) improving BAU and NAMA scenarios in waste sector and (iv) drafting of implementation plan.
Institute of Meteorology, Hydrology and Environment from Vietnam (IMHEN), the Overseas Environmental Cooperation Centre from Japan (OECC) with financial support from the Ministry of the Environment from Japan (MOEJ)
NAMA programme in the Waste Sector: “Waste to Resources for Cities in Vietnam”
Phase 1 (11/2013-06/2014) will be a preparatory stage, and the key activities to be conducted will be the full definition of the NAMA scope, a detailed plan of activities, milestones and priorities, as well as the identification of stakeholders that could take part in this NAMA. Phase 2 (07/2014-12/2015) will consist of building capacities among local partners and the implementation of at least two pilot projects in cities across Vietnam. Phase 3 (1/2016-12/2020) will consist of the full implementation of the NAMA throughout cities in Vietnam to achieve the target of reducing GHG emissions by 5%.
The Institute of Meteorology, Hydrology and Environment from Vietnam (IMHEN), in partnership with the United Nations Economic and Social Commission for Asia and the Pacific (UN-ESCAP)
Pilot studies for MRV in Hanoi and a 2nd city in SWM Sector
Capacity Building in MRV in pilot cities. Deliverable and outline of the project not yet defined
JICA implementing MONRE/MOC
Support for SWM development
Scope and activity is not yet defined Osaka as partner city and Da Nang as implementing city
90
1.7. Rationale for Sector Focus Alignment with Vietnamese Sustainable Development Priorities Despite the relatively low contribution of the solid waste sector to the reported total of GHG
emissions in the available GHG inventories in Vietnam, the volume of generated solid waste
nationwide increases significantly. The abovementioned JICA report (JICA, 2013) also confirms
the reported trend stating that the increase in the amount of solid waste generation which has
been verified in recent years is expected to continue in the future due, on the one hand, to the
continuous rapid industrialization and urbanization of the country and, on the other hand, to the
fact that open dumping and burning remain widespread in the landfill sites of the country.
Several strategy and programs already approved in Vietnam specifically address the issue of
solid waste management. These include:
the National Strategy for Integrated Management of Solid Waste up to 2025 and the
vision towards 2050 approved on 17th December 2009 by the Prime Minister (Decision
No.2149/QD-TTg), which sets specific objectives for solid waste management for several
horizons (2015, 2020 and 2025), namely in terms of collection and recycling rates for
urban and rural households and sets a very ambitious vision to 2050, when all forms of
solid waste will be collected, reused, recycled and treated completely by advanced
technologies and also the project Greenhouse Gas Emission Management;
Management of carbon credit business activities to the world market approved on 21st
November 2012 by the Prime Minister (Decision No. 1775/QD-TTg) which sets the target
of reducing GHG emissions by 5% in the waste sector by 2020.
Focusing on the waste sector can therefore be a contribution to sustainable development
priorities of Vietnam. Nevertheless, the scope of the work on the waste sector must be seen as
wider than the simple application of existing methodologies, in order to contribute to a broader,
more integrated approach to solid waste management.
Existing Initiatives in the Sector
There are indeed already ongoing initiatives in relation to the development of NAMAs and
NAMA readiness in the sector, as discussed above. However, these initiatives do not plan to lead
to crediting outcomes and are confined to major metropolitan areas (Hanoi and Da Nang). Other
landfill sites will also be already covered by ongoing or planned CDM activities. Nevertheless,
there is scope for a broader approach at sectoral level, given the number of landfill sites yet not
covered by any initiative. In addition, the scope of the work under PMR must not only cover
landfilling as an alternative but also address other technological opportunities currently not
covered by most other initiatives.
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Market Readiness and Technical Potential
Data is available but no systematic data collection effort exists. The PMR can contribute by
fostering the development of such a system. A more difficult issue relates to the lack of price
responsiveness in the sector. The institutional and legal framework lacks in providing
transparency, in particular with relation to costs and prices, and there is a near total lack of
enforcement of price incentives in relation to either waste prevention or reduction (e.g. waste
charges) or to waste disposal (e.g. tipping fees). Cost recovery is not prevalent throughout the
sector.
A recent E&Y report to the World Bank74 provides two low carbon scenarios:
Effective implementation of all the MSW management related policy / other initiatives
as per the various Decrees / programs;
Aggressive low carbon scenario: based on successful MSW management in countries
similar to that of Vietnam, assuming that measures adopted and implemented in those
countries can also be replicated effectively in Vietnam.
The following graph shows the projected abatement potential. Whilst the absolute numbers are
to be taken with care (see previous comments on the reliability of the baseline forecast) it
seems obvious that a significant emission reduction potential exists.
Figure 25: GHG Emission Scenarios (MtCO2e)
Source: E&Y on behalf of the World Bank, Greening the Waste Sector in Vietnam, draft report 2014
Differences between the two scenarios are of minor magnitude due also to the fact that the
Vietnamese policies and initiatives used for the low carbon scenario are very ambitious in this
sector.
74
E&Y on behalf of the World Bank, Greening the waste sector in Vietnam, draft report 2014
92
Experience with MBIs
As discussed above, the waste sector has in Vietnam 6 registered CDM projects and two NAMAs
are under preparation. Know-how and an initial capacity base have therefore been established
in this sector. This includes technical capacity in MRV at facility-level as well as knowledge of
crucial parameters in GHG emission calculation.
As a conclusion the waste sector has significant emissions and abatement options. It has been
given priority in government policies. The sector has several registered CDM projects and also 2
NAMAs under development and has a good potential for offset schemes be it project or sector
based. The sector therefore offers good opportunities for the implementation of a MBI but will
require considerable initial work on improving the database, and in complementing the crediting
NAMA design with analysis of other instruments.
2. Designing the Crediting Programme for the Solid Waste Sector
2.1. Scope and Coverage In line with the conclusions of a separate project on greening the waste sector in Vietnam75, the
proposed crediting NAMA for the Solid Waste sector would apply a number of CDM
methodologies as GHG protocols to the universe of approximately 83 landfill sites in the
country. The range of technologies and methodologies to be considered in application include:
Composting:
This technology already exists in Vietnam and some of them are already being financed
through CDM (these would be excluded from the scope of this NAMA).
New compost plants, when installed may be taken separately as Program of Activities
(PoA).
A PPP model can be explored, where private players can be provided incentives through
higher tariffs of power sale or tax subsidies. Design of a potential business model would
form part of the scope of the consideration of alternative instruments in the sector.
Composting can be monitored as per approved CDM methodology "AM0025 “Avoided
emissions from organic waste through alternative waste treatment processes".
75
“Greening the waste sector in Vietnam”, Ernst&Young (2014, draft)
93
Anaerobic digestion:
Tax incentives and power sale can be offered to private players to make the option
attractive.
Can be monitored as per approved CDM methodology "ACM0010: Consolidated
methodology for GHG emission reductions from manure management systems.
Landfill gas recovery:
There are three landfills in Vietnam, where this technology has been adopted (as part of
CDM projects and to be excluded from the proposed NAMA scope).
Penetration of this technology is currently low and is also cost intensive. However, this
would be a progressive step in converting existing landfills or dumpsites towards an
improved facility.
Can be monitored as per approved CDM methodology ACM0001 “Flaring or use of
landfill gas”.
The NAMA will cover controlled and managed landfills of Vietnam (according to IMHEN, OECCC,
MOEJ, 2013, 83 landfills). Not controlled and not managed landfills do not fulfil the
environmental standards of Vietnam and in most cases no input figures or other information are
available. Therefore, these sites have not been integrated into the PMR activities. The NAMA is
to be piloted with the landfills in 3 big cities of Vietnam Ho Chi Minh City, Haiphong and Can
Tho. Hanoi and Da Nang were not selected due to other activities of international donors (JICA
and city of Osaka). The 3 selected cities are representative concerning the solid waste treatment
system of Vietnam and with these 3 cities the PMR program covers around 20-25%76 of the
urban SW volume of Vietnam.
For the selected pilot sites and landfills sanitary technologies such as landfill gas recovery,
anaerobic digestions, composting and others will be evaluated and introduced with main focus
on GHG emission reduction. For the different technologies abatement options and costs shall be
evaluated and compared on a Vietnamese background. The CDM experience in the waste sector
will be integrated in this activity.
The strengthening of capacity of collection of reliable data in the solid waste management
sector is of first priority in order to define an appropriate baseline. Therefore, the MRV system
has to be established according to international standards.
2.2. Baseline As mentioned in the previous chapter data reliability is very poor and therefore the
establishment of a robust and trustworthy baseline at a sectoral level is currently not possible.
For the registered CDM projects the baseline was established using approved CDM
76
Estimation according to the mentioned SW volume/capita (Population of the 3 cities around 10.8 Mio)
94
methodologies based on a project-level approach. However for a sectoral approach, data needs
to be updated and data collection and management need to be improved prior to establishing a
baseline.
The development of a sector baseline requires basically more extensive and complete baseline
surveys across all elements of the waste chain, including statistical data collection on: waste
volume and composition, recycling rates, emission rates of alternative waste streams (disposal
vs. recycling) per material.
2.3. MRV Structure The proposed crediting NAMA could build on CDM protocols which would simplify MRV
questions (subject to potential adaptation to Vietnamese situation). Nevertheless, and as
outlined in BB3, there is the need, particularly if the crediting NAMA would be embedded into
future developments in Vietnamese solid waste policy, rather than simply issuing towards the
international market, to consider both the viability and desirability of too complex
administrative arrangements in relation to accreditation and certification of emission reduction
credits. The experience of different countries in the region with similar options (China, Thailand)
should be reviewed in this context.
As mentioned previously GHG mitigation goals can currently not be set in a robust manner due
to lack of trustworthy data. Therefore whilst mitigation potentials do exist and are also
documented in pilot cases e.g. in CDM waste projects, an aggregation to a sectoral level and
therefore to absolute mitigation potentials for MSW cannot be made without a prior upgrading
of the data collection systems and MRV capabilities across agents in the sector.
2.4. SWOT Analysis The following Table summarizes the strengths, weaknesses, opportunities and threats in relation
to implementation of a crediting NAMA in the waste sector in Vietnam.
95
Table 20: SWOT Assessment of MBI in the Waste Sector
Strengths
Alignment with country´s sustainable development policies;
Stringent objectives laid out in recent strategy and plans regarding GHG emission reductions in the sector and also with regards to collection, reuse and recycling rates;
Provision for utilization of MBIs for GHG emission management in existing legislation77;
Current development and feasibility analysis of the implementation of potential NAMAs programs in the sector, namely the “Waste to Resources for Cities in Vietnam” developed by INHEN and ESCAP, the “Introduction of Semi-aerobic landfill technology” developed jointly by IMHEN, OECC and MOEJ;
Undergoing JICA capacity building project for a National GHG Inventory in Vietnam;
Disposal fee is in place for the sector nationwide;
Available policies for investment incentives and technologies;
Participation of the private sector and communities.
Weaknesses
No structured data collection procedure on the sector (volumes, collection rates, separation rates, recycling rates, deposition rates, treatment processes, specific data on treatment facilities, etc.)
Gaps in resources and institutional capacity, fragmented and overlapping roles of the ministries and limited interagency coordination, which inhibits the implementation of policies and strategies on SWM;
Inexistence of a structured MRV for the sector;
High costs needed for investment in infrastructure, technologies and operating costs, while there are low collection and disposal fees;
Limited experience in MBIs;
Uncertainty of price signal.
Opportunities
Gained know-how on new technologies for GHG reduction in the sector;
Bilateral agreements with other countries for GHG emission trading (ex: Japan);
Integrated waste policy presents opportunities for improved local livelihoods and sustainable development benefits.
Threats
Uncertainty in global climate negotiations and consequently in the demand for credits generated through an MBI;
Limited awareness of the benefits of MBI;
Difficulty in engagement of the private sector in the sector, as policies on fees related to solid waste collection and treatment are not appropriate.
77
Project Greenhouse Gas Emission Management; Management of carbon credit business activities to the world market approved on 21st November 2012 by the Prime Minister (Decision No. 1775/QD-TTg
96
2.5. Institutional Arrangement The working group for the implementation of the MRP activities in the solid waste management
sector is led by the Department of Science Technology and Environment of MOC.
Figure 26: Institutional Structure of the Working Group Solid Waste
Management
The legal arrangement within MOC and within the Vietnamese solid waste management is
explained in chapter 1.5 of BB 4b.
2.6. Analysis of Other Market-Related Carbon Pricing Instruments As discussed above, the possibility of development of market-based instruments (essentially
crediting in the solid waste sector) is hampered also by the economic incentives around the solid
waste sector. Similar to the discussion on electricity price reform and the impact of subsidies on
price responsiveness and MBI effectiveness, so the lack of such price-related incentives may
lead to lower implementation and achievement of policy goals through MBIs. A variety of
instruments should therefore be considered as coadjutant of market readiness in the sector and
are proposed below.
Unlike the crediting NAMA above, focused on waste disposal, Vietnam has the opportunity of
utilizing economic incentives in order to implement in the future the 4Rs policy (reduce, recycle,
reuse, and recover).
97
2.7. Objectives, Activities, and Proposed Budget (Sub-Component 2.2) Donor Coordination
IMHEM is implementing NAMAs with the Overseas Environmental Cooperation Centre from
Japan (OECC) with the focus on MRV and in partnership with the United Nations Economic and
Social Commission for Asia and the Pacific (UN-ESCAP) consisting of capacity building,
implementation in pilot cities and thereafter full implementation within the country.
Additionally pilot city activities are being undertaken by JIC with MONRE/MOC and by Osaka as
partner city of Da Nang. Donor coordination will be on a thematic and general level coordinated
by ISEA as implementing agency of the two NAMAs as well as of the PMR activities in the waste
sector:
Activities realized by the MRP on data management will coordinate directly with the
MRV activities realized with OECC. This is basically a technical coordination to avoid
overlaps and to allow for a coordinated approach.
Various pilot cities and activities are being undertaken. This allows for gathering
valuable experience with different practical approaches. ISEA will organize on an annual
base a workshop where cities undertaking pilot implementations report on their work
and experiences. This allows to shell out different approaches, impacts of activities,
success factors and barriers. Open communication and knowing of other experiences
allows to improve the individual projects whilst giving the core elements for a national
approach. The realization of such regular meetings has been included as specific activity
within the area of capacity building.
Presentation of activities of the PMR at regular donor meetings therefore allowing to
identify at an early stage new or planned activities within the sector and allow for
information of the donor community on what activities are already on-going.
Coordination responsibility lies thereby primarily with the implementing agency ISEA.
Three major work packages are foreseen:
1. The designing of the crediting NAMA on waste disposal sites as outlined above; this is
then devolved into a number of specific activities related to the development of a data
collection system, establishment of sector and activity baselines, MRV, institutional
aspects, incentive structure, financing etc.
The design of the NAMA will be based on 3 pilot cities - Ho Chi Minh City, Haiphong and
Can Tho. The 3 selected cities are representative concerning the solid waste treatment
system of Vietnam. It has been ensured that the three selected cities are not already
included in other NAMA activities in the same sector.
For the selected pilot sites and landfills sanitary technologies such as landfill gas
recovery, anaerobic digestions, composting and others will be evaluated and introduced
with main focus on GHG emission reduction. For the different technologies abatement
98
options and costs shall be evaluated and compared on a Vietnamese background. The
CDM experience in the waste sector will be integrated in this activity.
2. Strengthening of the capacity in the collection of reliable data in the solid waste
management sector. This includes also regular interchange of experiences on pilot
implementations between all involved cities.
Through this component, the GoV will lay the foundation for piloting and implementing selected
market-based instruments, focusing on the solid waste sectors. The solid waste sector also
provides an opportunity to design and plan for the testing of MBIs in a sector with rapidly
growing emissions. The sector’s experience with several registered CDM projects and the two
NAMAs currently under development also illustrate its potential for implementing project or
sector-based MBIs. The data management and reporting will be developed by the line ministry
(MOC), in consultation with MONRE, as the focal point on NAMAs of the Government. The
policies developed as part of Component 1 for data management will help ensure all the
relevant data are collected, reported, and archived properly in a systematic and consistent way
to facilitate the integration of data into sectoral and national MRV systems.
ID Objective/ Subcomponent
Activity Budget PMR
12
Design of no-regret measures in solid waste sector with analysis of potential MBIs
Design of database and reporting system for the solid waste sector (chaired by MOC). This includes:
a). Development of a standardized data form for the solid waste landfills in Vietnam.
b). Survey, collection, aggregation, and calculation of the GHG emissions in the solid waste landfill sub-sector in Vietnam.
c). Design of standardized mechanisms and processes, database systems, information management, data to establish a credited NAMA MRV system for solid waste.
200,000
13 Capacity building for reporting, application of MBI(s) in the solid waste management in Vietnam (chaired by MOC).This includes:
a). Development of training programs, workshop materials, training and capacity building for stakeholders on tools, methodologies and databases for credited NAMA for solid waste sector.
b). Propagation of project content and results.
100,000
14 Assessment of the potential of realizing a credited NAMA for the solid waste sector (chaired by MOC).This includes:
a). Analyze and identify legal and institutional barriers and potential of participating GHG emission market participants for the solid waste, including the identification of
250,000
99
appropriate GHG emission mitigation measures.
b). Development of a baseline emissions calculation and mitigation measures for selected solid waste landfills in the pilot cities.
15 Based on experience of the piloting efforts and international experience re-assess appropriate MBI(s) for the solid waste sector in Vietnam (chaired by MOC). This includes:
a). Research and assess best practices for MBIs that are being applied worldwide in the solid waste sector.
b). Research on possibility to apply MBI(s) to the solid waste management through implementing the work conducted in Activities 12 through 14.
c). Development of a business model or roadmap to apply with broad coverage potential MBIs in the solid waste sector.
180,000
TIMELINE
ID Activities Responsible Agency
Time Required
Completion
12 Design a database and reporting system for the solid waste sector (chaired by MOC). This includes:
a). Development of a standardized data form for the solid waste landfills in Vietnam.
b). Survey, collection, aggregation, and calculation of the GHG emissions in the solid waste landfill sub-sector in Vietnam.
c). Design of standardized mechanisms and processes, database systems, information management, data to establish a credited NAMA MRV system for solid waste.
MOC continuous Year 3
13 Capacity building for reporting, application of MBI(s) and implementing a credited NAMA in the solid waste management in Vietnam (chaired by MOC).This includes:
a). Development of training programs, workshop materials, training and capacity building for stakeholders on tools, methodologies and databases for credited NAMA for solid waste sector.
b). Propagation of project content and
MOC 3 years Year 3
100
results.
14 Assessment of the potential of realizing a credited NAMA for the solid waste sector (chaired by MOC).This includes:
a). Analyze and identify legal and institutional barriers and potential of participating GHG emission market participants for the solid waste, including the identification of appropriate GHG emission mitigation measures.
b). Development of a baseline emissions calculation and mitigation measures for selected solid waste landfills in the pilot cities.
MOC 3 years Year 3
15 Based on experience of the piloting efforts and international experience re-assess appropriate MBI(s) for the solid waste sector in Vietnam (chaired by MOC). This includes:
a). Research and assess best practices for MBIs that are being applied worldwide in the solid waste sector.
b). Research on possibility to apply MBI(s) to the solid waste management through implementing the work conducted in Activities 12 through 14.
c). Development of a business model or roadmap to apply with broad coverage potential MBIs in the solid waste sector.
MOC 2 years Year 3
The total PMR budget for sub-component 2.2 is USD 730,000.
See for details Annex 1.
101
1. Organizational Setup
In order to implement the market readiness proposal in the next phase, a PMR Steering
Committee will be established under the chair of MONRE. The PMR Steering Committee will
provide strategies and recommendations from all line ministries and monitor and supervise the
PMR program. Members of the Steering Committee are the main ministries involved in GHG
reduction activities. The SC supervises and controls the implementation through the Project
Management Unit (PMU).
The Figure below shows the organizational set-up of the implementation of the MRP in Vietnam.
Figure 27: Organizational Setup for the Development of the Market Readiness Proposal
BUILDING BLOCK 5: ORGANIZATION, COMMUNICATION,
CONSULTATION AND ENGAGEMENT
1. Organisational Setup
2. Stakeholder Engagement
3. Objectives, Activities, and Proposed Budget
PMR Steering Committee Chair: MONRE
Members: line ministries
Project Management Unit (PMU) Director: DMHCC-MONREDeputy Director: DSENRE-MPI
Role: management of PMR project’s activities, liaison with other line ministries, coordinationamongst working groups and other relevant stakeholders, report to Steering Committee
Component 1. Steel Sector Chair: ISEA-MOIT Participants: relevant governmental and non-governmental partners and stakeholders in steel sector Role: implementation of activities in steel sector, recommendation of technical issues within waste sector, MRV system and report to PMU
Component 2. Waste Sector Chair: DSTE-MOC Participants: relevant governmental and non-governmental partners and stakeholders in waste sector Role: implementation of activities in steel sector, recommendation of technical issues within waste sector, MRV system and report to PMU
102
Members of the Steering Committee are the main ministries and agencies involved in GHG
reduction activities:
Ministry of Natural Resources and Environment (MONRE)
Ministry of Planning and Investment (MPI)
Ministry of Construction (MOC)
Ministry of Industry and Trade
Ministry of Finance (MOF)
Ministry of Transport (MOT)
Urban Environment Companies (URENCO)
If any relevant decision arises during the PMR implementation phase that needs to be addressed
at a higher political level, the Steering Committee will submit this decision to the responsible
Ministers. The SC will enforce and implement the project management unit.
The PMU will be set up by the DMHCC - an agency of MONRE. DMHCC will appoint a project
director and a project manager for the overall organization, management, daily operation as
well as for the coordination with all relevant stakeholders, Ministries and agencies. In this role,
the PMU will be responsible for the overall day-to-day supervision of the implementation of the
PMR tasks described in this document. The PMU will coordinate all the activities of the working
groups and set standards concerning MRVs, NAMAs and GHG assessment procedures. The PMU
will monitor and supervise the progress of the working groups in the two selected sectors.
The PMU will also lead the coordination workshops with other international donors active in the
selected sectors. Therefore, the PMU keeps regularly communication with all international
organizations in order to use best synergies of other projects and to prevent any overlapping
activities.
Based on the Vietnamese legal framework and the proven experience with the carbon market
the Department of Hydrology Meteorology and Climate Change (DHMCC) was selected as PMU
- the focal point for the implementation due to:
DHMCC has proven experience as DNA Vietnam in the national and global climate
change policy. Based on this experience DHMCC is acquainted with MRV systems (e.g.
CDM) concerning carbon credits.
With the Prime Minister's Decision No.: 1775/QD-TTg, Approval of Project of
Greenhouse Gas Emission Management; Management of Carbon Credit Business
Activities to the World Market, MONRE was assigned to have the prime responsibility
for this task.
103
Based on Minister Decision 1269/QD-BTNMT, approved on July 31, 2013, DHMCC was
appointed as focal point for:
o "forming the domestic carbon market and participating in the international
carbon market";
o to set up a database on national greenhouse gases and establish a national
greenhouse gas inventory for 2005 and a system for national GHG inventories
and
o for "Building relevant national and sectoral-level MRV system, related to
NAMA".
Further, DMHCC is the office of the National Committee on Climate Change (NCCC) that
can help expanding PMR to other sectors of Vietnam.
On the sector level two working groups will be implementing the PMR program in Vietnam. The
working group are chaired by the line ministries MOIT for the steel sector and MOC for the solid
Waste management sector. The working groups will be led through the following agencies:
The Industrial Safety Techniques and Environment Agency (ISEA) from MOIT will chair
the working group of the steel sector.
The Department of Science, Technology and Environment (DSTE) of MOC will chair the
working group for the waste sector.
The two selected agencies have proven experience in international projects and in the field of
the PMR activities.
The Industrial Safety Techniques and Environment Agency (ISEA) performs the function of state
management and enforcement of safety at workspaces and supports industry and trade in
environmental protection issues. ISEA is the responsible body for climate change topics within
MOIT and works in this function closely together with DMHCC in the establishment of the
national GHG Inventory. Therefore the cooperation concerning data collection and data
management between the selected MRP-PMU and ISEA is already established and functioning.
ISEA is the implementing agency in the UNDP NAMA project in the steel sector. It also currently
works with UNIDO on its Green Industry Initiative.
The working group of the solid waste management sector will be chaired by the Department of
Science, Technology and Environment (DSTE). DSTE - an agency of MOC is responsible for the
management of science, technology and environment in the ministry including technology
transfer, standards, scientific research and environmental protection. The department is the
main responsible agency in MOC concerning climate change. In this task they have proven
cooperation experience with MONRE.
For special tasks the PMU in coordination with the working groups establish Consultative Expert
Groups. Members of these expert groups shall be representatives of companies involved,
associations, research organizations and other NGOs. Tasks and objectives shall be formulated
by the PMU under the supervision of the Steering Committee.
104
For more specific and technical activities project consultants shall be assigned. Bidding
processes and the procurement procedures for these assignments will have to comply with the
requirements of the Steering Committee and with the PMR secretariat rules.
2. Stakeholder Engagement Communication will be a crucial success factor for the implementation of the MRP Vietnam.
There are numerous projects active in the establishment of MRV systems and NAMAs. In order
to use synergies and prevent overlaps the PMU has to be in regular contact with all
stakeholders. At least once per year the PMU invites all relevant international donors and
implementing agencies for a coordination workshop. In the progress reports of the PMU on
behalf of the steering committee and PMR secretariat the activities of other projects have to be
integrated.
The PMU coordinates with DHMCC the collection of all MRV data of the different projects and
support the establishment of a data management platform. The PMU in cooperation with the
DHMCC needs to link GHG inventory activities with the MRV activities of the program and other
projects.
Another key element for a positive outcome of the proposed activities will be the integration of
the stakeholders of the selected sectors. It is an important task of the PMU to invite regularly
representatives of the steel companies including associations, and of the URENCOs and waste
treatment companies in order to get their feedback and comments on the different elements of
the program. Therefore the PMU will organize inception workshops for the important
stakeholders and regularly consultation events and seminars. In order to create a good
understanding the PMU establishes a capacity building program:
Capacity building for public and private sectors: Strengthen the technical capacity of the
private and public sectors on matters related to the design, implementation and
operation of an MBI for the selected sector along with its associated MRV and Registry
systems. These activities include the training of general technical issues for both the
public and private sectors on topics of NAMA, MRV, registry and regulatory aspects.
Political engagement: Engage the stakeholders of this project by sharing information on
the objectives, basic elements and technical requirements associated to the design,
implementation and operation. These activities include stakeholder consultations on
proposed regulations with public and private sectors, as well as conducting workshops
with representatives of countries that have already implemented comparable schemes.
This work also includes a series of dissemination and knowledge-sharing activities, such
as workshops, seminars and meetings aimed at raising awareness on climate change
issues and the role of a MBIs in the country.
105
3. Objectives, Activities and Proposed Budget (Component 3) This component will support MONRE (as chair of the PMR Steering Committee) to guide the implementation of the proposed activities and other MBI-related activities in Vietnam. This component would also support enhanced stakeholder engagement and communication efforts, including the reporting of PMR project implementation progress to the NCCC.
ID Objective/ Subcomponent
Activity Budget PMR
16
Program
Management
and Stakeholder
Engagement
Facilitation
Project coordination and management of fiduciary
requirements with a dedicated project management team
to ensure efficient and effective program implementation.
This includes:
a). Establishment of project coordination and management
team.
b). Quality control of reports, document reviews,
clearances and publications.
c). Support the official reviews and clearance processes
across participating line ministries.
d). Operation support for PMU: Equipment and travel
support for project coordination and management team
during the project implementation.
235,000
17 Communication and stakeholder engagement including
conducting a feedback and learning process with
stakeholders to ensure awareness raising and
dissemination of results. This includes:
a). Design of a strategy for stakeholder engagement
including a communication strategy and implementation of
strategy involving stakeholder meetings, workshops and
seminars
b). Capacity building for public and private sectors -
Strengthen the technical capacity of the private and public
sectors on matters related to the design, implementation
and operation of an MBI for the selected sector along with
its associated MRV and Registry systems.
145,000
106
TIMELINE
ID Activities Responsible Agency Time Required Completion
16 Project coordination and
management of fiduciary
requirements with a dedicated
project management team to
ensure efficient and effective
program implementation. This
includes:
a). Establishment of project
coordination and management
team.
b). Quality control of reports,
document reviews, clearances
and publications.
c). Support the official reviews
and clearance processes across
participating line ministries.
d). Operation support for PMU: Equipment and travel support for project coordination and management team during the project implementation.
MONRE 3 years Year 3
17 Communication and
stakeholder engagement
including conducting a
feedback and learning process
with stakeholders to ensure
awareness raising and
dissemination of results. This
includes:
a). Design of a strategy for
stakeholder engagement
including a communication
strategy and implementation
of strategy involving
stakeholder meetings,
workshops and seminars
b). Capacity building for public
MONRE 3 years Year 3
107
and private sectors - Strengthen the technical capacity of the private and public sectors on matters related to the design, implementation and operation of an MBI for the selected sector along with its associated MRV and Registry systems.
The total PMR budget for component 3 is US$ 380,000.
See for details Annex 1.
108
The total budget required for all proposed activities under the PMR is estimated at 3,600,000
USD. Vietnam requests the Partnership Assembly to grant USD 3,000,000 as PMR support for
the proposed activities. The remaining budget of 600,000 USD will be funded by the Vietnamese
Government and other sources of funds.
The summary of schedule and budget for each area is shown in the following table. The Annex
includes the detailed schedule and budget.
Table 21: Summary Activities and Budget
Area Year 1 Year 2 Year 3 Total PMR GoV/others
Component 1 350,000 650,000 350,000 1,350,000 1,100,000 250,000
Component 2 550,000 500,000 750,000 1,800,000 1,520,000 280,000
Component 3 150,000 150,000 150,000 450,000 380,000 70,000
Total 1,050,000 1,300,000 1,250,000 3,600,000 3,000,000 600,000
Year 1 is expected to be the full year 2015, year 2: 2016 and year 3: 2017
BUILDING BLOCK 6: Summary of Activities, Timeline and
Budget
109
Annex 1: Activities, Outputs, Timelines and Budget PMR
The following table only includes the PMR Budget.
No COMPONENTS AND ACTIVITIES Estimated
budget (US$) Implementing
Agency Cooperating
Agency
Component 1: Strengthening capacity for development and implementation of policies and management tools for credited NAMAs and readiness to participate in the carbon market.
Subcomponent 1.1: Evaluating MBIs and assessing requirements for introducing MBI(s) in Vietnam
1 Activity 1: Evaluation of market based instruments (MBI) for the formulation and implementation activities of NAMA, especially credited NAMA in Vietnam (chaired by MONRE)
MONRE
MPI, MOC, MOIT
1.1 1.1: Conduct an overview research of carbon pricing approaches and MBIs and evaluate some mitigation MBIs that are being implemented around the world. 70,000 MONRE
MPI, MOC, MOIT
1.2 1.2: Research and evaluate potential MBI(s) that can be applied for NAMA, especially credited NAMA in Vietnam. 50,000 MONRE
MPI, MOC, MOIT
2 Activity 2: Research and formulation of mechanisms and financial policies and measures to establish and operate a carbon market (chaired by MPI)
MONRE
MPI, MOC, MOIT
2.1
2.1: Research and develop mechanisms, policies, and measures to mobilize involvement and financial supports from private sector, banks and credit funds as well as international support, such as the Green Climate Fund, for implementing carbon market and application of MBI(s) in Vietnam. 150,000 MPI
MONRE, MOC, MOIT
3 Activity 3: Research and development of data collection and management systems for the operation of carbon markets (chaired by MONRE)
MONRE
MPI, MOC, MOIT
3.1 3.1: Develop a data collecting model; propose data structure and data management systems. 50,000 MONRE MPI, MOC,
MOIT
3.2 3.2: Develop a technical map for mitigation activities. 50,000 MONRE MPI, MOC,
110
MOIT
4 Activity 4: Stakeholder training on carbon pricing approaches (chaired by MONRE)
MONRE MPI, MOC,
MOIT
4.1 4.1: Develop technical training programs at three levels: (i) central, (ii) sectors and (iii) local levels on requirements for credited NAMA and carbon market readiness. 100,000 MONRE
MPI, MOC, MOIT
4.2 4.2: Perform dissemination, awareness raising about responsibility for implementing GHG emission reduction and trading of carbon credits at all levels, sectors, localities, communities and businesses. 150,000 MONRE
MPI, MOC, MOIT
5 Activity 5: Research and develop roadmap for implementing carbon market and application of MBI(s) in Vietnam (chaired by MONRE) 50,000 MONRE
MPI, MOC, MOIT
Subcomponent 1.2: Assessing the institutional and regulatory framework for implementation of carbon pricing in Vietnam
6 Activity 6: Development of strategies for potential barriers that may hinder the establishment of the carbon market in Vietnam (chaired by MONRE)
MONRE
MPI, MOC, MOIT
6.1
6.1: Empirical research and analyze scientific basis of establishment of the domestic carbon market and the trading carbon credits on the world market (incl. simulation and impacts studies of an implementation of domestic carbon market. 80,000 MONRE
MPI, MOC, MOIT
6.2 6.2: Review legislation, organizational structure of NAMA management and carbon credits generated from NAMA in Vietnam. 80,000 MONRE
MPI, MOC, MOIT
6.3 6.3: Analyze and identify barriers, limitation in organizational structure and current policies for the development of carbon markets in Vietnam. 50,000 MONRE
MPI, MOC, MOIT
7 Activity 7: Study and development of criteria and crediting process for carbon markets in Vietnam (chaired by MONRE)
MONRE
MPI, MOC, MOIT
7.1 7.1: Study and identify necessary factors for the measurement, reporting and verification (MRV) of activities that generate carbon credits. 80,000 MONRE
MPI, MOC, MOIT
7.2 7.2: Study and identify standards and procedures of examination and evaluation of carbon credits. 80,000 MONRE MPI, MOC,
MOIT
7.3 7.3: Research and propose a process to register, grant, withdrawal and exchange carbon credits. 60,000 MONRE MPI, MOC,
MOIT
Subtotal 1,100,000
111
Component 2: Design a pilot credited NAMA for the steel industry
Subcomponent 2.1: Developing market-based instrument pilot in steel sector
8 Activity 8: Development of a database and reporting system for steel industry (chaired by MOIT)
MOIT MONRE,
MPI
8.1 8.1: Review the database system for energy consumption in the steel industry. 50,000 MOIT MONRE,
MPI
8.2 8.2: Develop data collection form for the MBI operation in the steel industry. 50,000 MOIT MONRE,
MPI
8.3 8.3: Set up management systems, reporting and verification of GHG emissions in the steel industry. 70,000 MOIT MONRE,
MPI
8.4 8.4: Perform additional duties in accordance with the review results in the update and synchronize research that relevant to the NAMA implemented in the steel industry. 30,000 MOIT
MONRE, MPI
9 Activity 9: Capacity building for stakeholders involved in the implementation of MBI(s) in the steel industry (chaired by MOIT)
MOIT
MONRE, MPI
9.1 9.1: Training and workshop to evaluate potential opportunities to undertake MBI(s) in the steel industry. 40,000 MOIT
MONRE, MPI
9.2 9.2: Workshop to evaluate reports for MRV and GHG emission databases in the steel industry 40,000 MOIT MONRE,
MPI
9.3 9.3: Training and capacity building for the management agencies of the MRV system, operations and management carbon credit in the carbon steel. 40,000 MOIT
MONRE, MPI
10 Activity 10: Development of design for credited NAMA and pilot reporting on a voluntary basis for steel industry (chaired by MOIT)
MOIT
MONRE, MPI
10.1 10.1: Evaluate and select the steel companies participating in the pilot 30,000 MOIT MONRE,
MPI
10.2 10.2: Training and capacity building workshop for deploying GHG emissions database in the steel industry. 40,000 MOIT
MONRE, MPI
10.3 10.3: Designing data collection management, MRV system, registry for credited NAMAs for the steel sector 200,000 MOIT
MONRE, MPI
112
10.4 10.4: Workshop to consult and evaluate implemented results. 30,000 MOIT MONRE,
MPI
11 Activity 11: Research and analysis of necessary components to establish the trading carbon market in the steel industry (chaired by MOIT)
MOIT
MONRE, MPI
11.1 11.1: Analyze and assess the basis to establish the trading carbon market in the steel industry. 40,000 MOIT MONRE,
MPI
11.2 11.2: Research and propose solutions to establish and facilitate the trading carbon market in the steel industry. 60,000 MOIT
MONRE, MPI
11.3 11.3: Study mechanisms to attract voluntary participation of steel companies to participate in the carbon market. 70,000 MOIT
MONRE, MPI
Subtotal 790,000
Subcomponent 2.2: Design of no-regret measures in solid waste sector with analysis of potential MBIs
12 Activity 12: Development of a database and reporting system for the solid waste sector (chaired by MOC)
MOC
MONRE, MPI
12.1 12.1: Develop information and data form on the solid waste. 20,000 MOC MONRE,
MPI
12.2 12.2: Survey, collect, aggregate, calculate the GHG emissions in the solid waste sector in Vietnam. 100,000 MOC MONRE,
MPI
12.3 12.3: Develop mechanisms and processes, database systems, information management, data to establish credited NAMA MRV system for solid waste. 40,000 MOC
MONRE, MPI
12.4 12.4: Survey and research focusing on areas generating large solid waste amount to identify potential sites for developing a credited NAMA in solid waste sector 40,000 MOC
MONRE, MPI
13 Activity 13: Capacity building for reporting, application of MBI(s) and implementing credited NAMA in the solid waste management in Vietnam (chaired by MOC)
MOC
MONRE, MPI
13.1 13.1: Develop programs, workshop materials, training and capacity building for stakeholders on tools, methodologies and databases for credited NAMA for solid waste sector. 80,000 MOC
MONRE, MPI
13.2 13.2: Propagate project content and results. 20,000 MOC MONRE,
MPI
113
14 Activity 14: Assessment of potential credited NAMA for the solid waste sector (chaired by MOC)
MOC MONRE,
MPI
14.1 14.1: Review legal document system and organizational management in the solid waste. 30,000 MOC MONRE,
MPI
14.2 14.2: Analyze and identify barriers and potential of participating GHG emission market participants for the solid waste, including the identification of appropriate GHG emission mitigation measures. 70,000 MOC
MONRE, MPI
14.3 14.3: Assess the current state of solid waste landfills in Hanoi, Da Nang and Ho Chi Minh City to develop potential credited NAMA. 90,000 MOC
MONRE, MPI
14.4 14.4: Develop baseline and mitigation measures for selected solid waste landfills. 60,000 MOC MONRE,
MPI
MOC
MONRE, MPI
15 Activity 15: Research and assessment of appropriate MBI(s) for the solid waste sector in Vietnam (chaired by MOC)
MOC
MONRE, MPI
15.1 15.1: Research and assess MBIs that are being applied worldwide in the solid waste. 60,000 MOC MONRE,
MPI
15.2 15.2: Research on possibility to apply MBI(s) to the solid waste management through implementing a pilot NAMA project for selected solid waste landfills (Hanoi, Da Nang, and Ho Chi Minh City). 60,000 MOC
MONRE, MPI
15.3 15.3: Develop a roadmap, plans to apply MBI(s) for solid waste management in Vietnam. 30,000 MOC MONRE,
MPI
15.4 15.4: Research and develop mechanism, procedures, standards for carbon credits issuing in solid waste management 30,000 MOC
MONRE, MPI
Subtotal 730,000
114
Component 3: Program Management and Stakeholder Engagement Facilitation
16 Activity 16: Project coordination and management of fiduciary requirements with a dedicated project management team to ensure efficient and effective program implementation.
MONRE
MPI, MOC, MOIT
16.1 16.1: Establishment of project coordination and management team. 25,000 MONRE MPI, MOC,
MOIT
16.2 16.2: Quality control of reports, document reviews, clearances and publications. 80,000 MONRE MPI, MOC,
MOIT
16.3 16.3: Support the official reviews and clearance processes across participating line ministries. 50,000 MONRE MPI, MOC,
MOIT
16.4 16.4: Equipment and travel support for project coordination and management team during the project implementation. 80,000 MONRE
MPI, MOC, MOIT
17 Activity 17: Communication and stakeholder engagement including conducting a feedback and learning process with stakeholders to ensure awareness raising and dissemination of results.
MONRE
MPI, MOC, MOIT
17.1
17.1: Design of a strategy for stakeholder engagement including a communication strategy and implementation of strategy involving stakeholder meetings, workshops and seminars (including regular communication processes with stakeholders involved in carbon pricing). 25,000 MONRE
MPI, MOC, MOIT
17.2
17.2: Capacity building for public and private sectors - Strengthen the technical capacity of the private and public sectors on matters related to the design, implementation and operation of an MBI for the selected sector along with its associated MRV and Registry systems. 120,000 MONRE
MPI, MOC, MOIT
Subtotal 380,000
TOTAL 3,000,000
115
TIMELINE
116
Annex 2: List of Contacts and Meetings in Vietnam Ref.
DATE TIME ORGANIZATION PARTICIPANT TOPIC AND OUTPUT
1 25-Oct-13
16:00 - 17:15
ADB Viet Nam Resident Mission
Ms. Lauren N. Sorkin - MRP Project - Overview and expectation - Cooperation scheme of parties - Get link with others relative projects in ADB/WB
2 25-Oct-13
18:30-19:15
World Bank Mr. Christophe Crepin
3 29-Oct-13
14:30-16:00
Department of Science, Education, Natural Resource and the Environment -MPI
Deputy Director General, Mr. Nguyen Tuan Anh Technical Specialist, Mr. Le Duc Chung Officer - Mr. Truong Anh Son
- Discuss on green growth strategy and sector selection - Update activity situations relating with the project - Support to arrange meetings with relevant organizations - Commitment to support consultant team in identifying and collecting data/documents. - Agree channel of communication and scheme of cooperation in future Output: see the sent minutes
4 30-Oct-13
9:00-10:30
World Bank Ms. Laura Altinger
MRP Project - Overview and expectation Link consultant with other activities and people in ADB/WB Information about NAMAs in VN Provide information and project documents of WB with connection to MRP
5 3-Nov-13 14:00-17:00
Department of Science, Education, Natural Resource and the Environment - MPI
Mr. Chung, representative of DSENRE – MPI
- Handle a list of contact people in Gov. Agencies - Advise in the term of document collection - Send a report "National State of Environment 2011: Solid waste
117
6 4-Nov-13 14:00-15:30
Central Institute for Economic Management (CIEM) - MOIT
Director, Mr. Nguyen Manh Hai
- Discuss on "studying into the economics of low carbon, Climate-resilient development in Vietnam- Scoping phase", - Talk about work of Institute on how to collect data, type of data, methodology and modelling for macro-economic analysis -weak basic data for models - Introduce Institute of Energy of MOIT, where data could be collected
6 5-Nov-13 10:00-12:00
Department of International Cooperation (ICD) -MONRE
General Director, Ms. Tran Thi Minh Ha Official, Ms. Nguyen Thi Minh Nguyet
- Introduce the responsibility of MONRE and relevant departments - Express of interest and idea on sector selection - Introduce the green growth strategy in Vietnam - Explain the deadline of 3rd communication and the current status of national inventory activities: the work is in progress but not drafted and cannot be shared with the Consultant - Share few information about the signed cooperation between Vietnam and Japan under climate change action: bilateral offset credit mechanism (BOCM) / joint crediting mechanism (JCM); no details about BOCM and JCM are currently worked out. - Introduce the environment protection budget which occupies around 1% of GDP in Vietnam - Explain the carbon market as CDM projects and policy for carbon management in Vietnam Output: support consultant team to have meetings with Department of non-hazardous Waste management, Pollution control and Department of Policy and Legislation
7 5-Nov-13 11:15-11:40
Department of Meteorology, Hydrology and Climate Change
Deputy Director General, Mr. Nguyen Khac Hieu
- Explain the national inventory calculation process - MONRE cooperates with JICA for national inventory program. They finished study of national inventory in 2005 and they are doing in the process for national inventory in 2010: Consultants are interested in both inventories for integrating in the MRP - Explain the methodology applied for inventory - using the top down approach based on the energy balance sheet and GSO figures. - Confirm that "the 3rd communication" has not finished yet - Plan to make the national collection data for GHG emission Output: will share results of national inventory and suggest technical organization for national inventory - performed by IMHEN
118
8 5-Nov-13 15:00-16:00
Agence Française de Développement(AFD)
Project Officer - Ms. Nguyen Thi Thanh An
- Share information about the AFD study relating to Steel sector - AFD will organize a workshop mid December 2013 on this Steel Study - Share experiences of the survey in the steel sector: how to collect data through questionnaire, reliability of data, methodology of study and gaps Output: get the link with consultant team of AFD project, who is carrying out project "Establishment of an Energy Saving Scheme in the Steel sector in VN" Still waiting for sharing Report and survey result
9 6-Nov-13 9:30-10:30
Vietnam institute of Meteorology, Hydrology and Environment (IMHEN) - MONRE
Director General, Prof. Dr Tran Thuc Director of Climate Change Research Centre, Ms. Huynh Lan Huong
- Show their role in the JICA program relating to solid waste sector and GHG national inventory in 2005 and 2010 however they cannot share the achievement with the Consultant - Explain the data collection process and the GHG calculation methodology which is mainly based on IPCC 1996 data - Explain the plan to propose the centralization of the GHG monitoring system in Vietnam - a long-term vision which will not target sectoral MRV activities of the Consultant - Describe the survey of solid waste, the role of URENCO in solid sectors, real situation of waste management in Vietnam, kind of landfills Output: IMHEN could not share any data with the Consultant team - especially no national inventory results
10 6-Nov-13 14:00-15:00
Green Building Council (VGBC)
Executive Director - Nguyen Minh Thong Chief Technical and Advisor - Yannick Millet
-Give advice for the newest energy efficiency code of MOC - Make an overview of the current buildings in Vietnam, LOTUS label and how many buildings joining in this process - Describe the implementation of energy efficiency code in 2005 - Expect the incentives for green buildings in Vietnam - Confirm that no baseline is existing for green buildings in Vietnam until now Output: sharing the white paper of green buildings and some publication documents, VGBC would be interested in a cooperation in a pilot project in the EE of green building sector in the MRP .
119
11 6-Nov-13 16:00-17:00
JICA Senior Project Formulation Advisor – Michiyo Kakegawa
- Share experiences and information of the solid waste project - Share experience on solid waste practices in Hanoi - Share opinion and route on NAMA development project (idea of chosen sector, technical assistant for policy) Output: sharing file "Preliminary Results of Joint Study Project in Vietnam - Ver. 1, Waste sector"
12 7-Nov-13 8:30-10:00
MONRE - Department of Policy and Legislation - Department of Non-hazardous Waste Management -Vietnam Environment Agency (VEA) - Department of Pollution Control for Air and Recycling Material - Vietnam Environment Agency
Deputy Director of Department of Policy and legislation VEA - Mr. Hoang Minh Son Head Division of non-Hazardous waste management - Mr. Nguyen Thanh Lam Head of Division of Pollution control for air and recycling material - Mr. Nguyen Hoang Duc
- Explain the role of monitoring under Department of Pollution control for air and recycling material control. They focus on monitoring air pollution (classic air pollutant) in general, GHG is not a focus of their work - Mr. Duc explained the air pollution control in steel sector, the requirements of monitoring system in Vietnam. For example, the enterprises of steel sector have to install the monitoring system and update report for DONRE. They would like to install the continuously measuring monitor system but it lacks of finance to do that. - Mr. Lam explained the solid waste management in Vietnam. The systematically data collection in SWM is lacking and therefore no reliable raw data are available. MONRE would be interested to implement a mandatory reporting system with penalty system. -Mr. Son explained about the revised Environment Law submitted to National Assembly: new financial mechanism with financial incentives and environmental taxes has been integrated in the new draft. Output: The Consultant got the draft of the adjusted environment law.
13 7-Nov-13 13:30-14:30
UNIDO National Program officer Ms. Le Thi Thanh Thao
- Present the findings of the study "Energy and Resource Efficiency in the Vietnam Steel Industry", (UNIDO, July 2011) : Data collection in 18 EAF steel companies in Vietnam presenting around 90% of the EAF produced steel in VN; data reliability, benchmark between the screened companies UNIDO will not carry out further activities in the steel sector; a NAMA in the steel sector will be carried out based on the mentioned study through UNDP. - Suggest their organization’s orientation under NAMA
120
Output: Collecting of different project documents, esp. the above mentioned study
14 8-Nov-13 9:00-10:00
Audio Conference at ADB Ha Noi
- Christophe Crepin, WB Washington DC - Taisei Matsuki, WB - PMR-Secretariat, Washington DC - Rehan Kausar, ADB Manila - Lauren N. Sorkin, ADB Hanoi - Consultant Team
- Quick check activities of consultants with plan - Key findings and challenge faced - Tentative activities in the following months Output: see minutes drafted through the Consultant
15 8-Nov-13 15:00-16:00
Institute of Energy, MOIT
Energy Economics, Demand Forecast and DSM Department - Mr. Nguyen Duc Song - Mr. Nguyen Hoang Anh
- Made "Energy Statistic in Vietnam" -Already issued: "Energy statistic in Vietnam in 2010, issuance in preparation: Energy statistics in Vietnam 2011 and 2012 - Gave an overview about the studies they were involved in - Explained the data collection, how to calculate energy consumption, the source of calculated figures (e.g. in the steel sector: bottom-up company based figures), methodology and tools and how to calculate for sub sectors including steel and households. Basic data from steel sector survey are secret and cannot be shared with the Consultant. Output: Consultant got the report "Energy Statistic for the year2010". Consultant is still waiting for the Energy Statistic Reports of the years 2011 and 2012
121
16 11-Nov-13
16:00-17:00
Industrial safety techniques and environment agency (ISEA) -MOIT
Deputy Director General, Mr.Nguyen Van Thanh Director of Division of Pollution control and Environment Industry, Mr. Pham Sinh Thanh
- Cooperate with UNIDO in the above mentioned steel project - Develop the national target for energy efficiency - Explain to the Consultant the VSA organizational set-up - Explain the consultant the incentive system mentioned in the Decree 04/2009/ND-CP relating to incentives of environmental protection in Vietnam - Introduce the Consultant the master plan of steel sector - Explain the fact in Vietnam for GHG monitor system based on the fund - Recommend the Consultant to get in contact with General Directorate Of Energy - MOIT for EE reports Output: understanding about master plan of steel sector and decree relating to incentives for environmental protection measures in Vietnam
17 12-Nov-13
8:30-9:30
Department of Science and Technology - MOIT
Officers: - Mr. Le Hoang - Mr. Le Viet Cuong
- Explain the change of their role in MOIT with industrial sectors -Suggest another organization who can answer questions of consultant team - Introduce the steel technology under expert experience - Recommend new draft regulations published in MOIT website in steel sector Output: contact details for the General Directorate of Energy
18 12-Nov-13
10:00-11:00
UNDP
Head of Sustainable Development Cluster- Mr. Dao Xuan Lai Program Officer - Sustainable Development Cluster - Mr. Andreas Wallin Karlsen
-Introduce the cooperation with UNIDO to continue the study of steel sector for benchmark - Outline their ideas of NAMA development, the project will have multi-objectives - The formulation of NAMAs in two sectors is one of many topics. - The design of the NAMAs are not yet defined Output: UNDP will send the Consultant the detailed outline of the project
19 12-Nov-13
14:00-15:00
Vietnam Steel Association (VSA)
Vice Chairman, Mr. Chu Duc Khai
-Introduce the task and role of VSA between members and the government - Describe the technology of applied steel enterprises, current situation of steel sector in Vietnam and the VSA solutions to support for their members - Explain the data collection and how reliable data is and the gap of the project - VSA has no production or energy consumption data of their associated member companies - Explain the difficulties in CDM implementation in the steel sector: High investment costs compared to small CDM revenues Output: less information and data than expected through Consultant
122
20 13-Nov-13
8:00-17:00
Workshop on Greening the Waste Sector in Vietnam organized by World Bank
MOC MONRE WB
- Solid waste management policies - Challenges and Needs of Vietnam's current situation: future SW elimination not defined - only 10% of landfills are sanitary - Key challenges in solid waste management and recycling in Vietnam: organizational set-up with too many stakeholders, low implementation rate of legal framework, no systematic data collection, Output see: workshop presentations
21 14-Nov-13
12:40-16:00
ERNST & YOUNG, consultant team for baseline Emissions and key issues for green growth in waste sector
Mr. Surojit Bose, Director Mr. Ha Ngoc Nam
- Get information/data in solid waste management in Vietnam - Commitment in sharing data - Basic reliable data for waste sector are lacking - EY will share the draft report in this sector with the Consultant
22 14-Nov-13
14:00-15:00
Department of Tax Policy - Tax Agency
Mr. Hung Ms. Huong, Corporation tax specialist
-Introduce the tax in environmental protection, import and export tax, enterprise income tax, value added tax - Introduce the decree No.04/2009/ND-CP about incentives regulation - Introduce the regulation for environmental protection Output: collecting documents mentioned above
23 15-Nov-13
8:30-9:30
RCEE-NIRAS JSC Ms. Phan Thi Minh Thao -Show data in steel sector of AFD project: draft survey output - Explain the data collection, reliable data and results of study Output: need agreement of AFD/MOIT in sharing study output
24 15-Nov-13
10:00-11:00
GIZ
Technical advisor –Farid Selmi Junior advisor - Lisa Tinchert
- Planning and have not started MRV project and NAMA development yet
25 18-Nov-13
9:00-10:00
ADB project - TA7779
Team Leader - Kim Harboe Deputy Team Leader - Ha Dang Son
Output: share ongoing project and collected data
123
26 20-Nov-13
9:00-9:45
General Directorate of Energy
Science, Technology and Energy Efficiency Department Official Mr Dang Hai Dung
- Share information of law, decree and regulation relating to energy efficiency - The biggest energy consumers in industry (> 1,000 Mtoe) has to submit annual reports about their energy consumptions. Until now 1'200 companies are listed. The reporting duty is also implemented in the building sector (real estate properties with > 2,500 m
2 utilizable space) as well as in the transport sector.
- Templates for reporting are available on internet. - Reporting is difficult for the companies due to lacking capabilities of the responsible persons. - Based on the reporting system, a database will be established. Mr. Dung explained the difficulties in Vietnam during the implementation of the energy consumption management Need Official Letter of MPI to request MOIT on sharing draft Report on "Establishment of an Energy Saving Scheme in the Steel Sector in Vietnam" as well as its surveys on steel sector
27 25 Nov 13
15:00-16:00
Science - Technology and Environment Department - MOC
Tran Dinh Thai, Deputy Director of the Department
* Green Building/Construction: - Issued National Technical Regulation on Energy Efficiency Buildings (QCVN 09:2013/BXD) - carried out Green Building Program In Vietnam under the support of IFC to survey 59 buildings with gross floor areas of more than 2500 m
2 each in 3 big
cities (HN, HCM, DN) contact IFC for survey report - In some recently years, hiring Energy Efficiency Centre in HCM city to survey big building for green construction (counting up to 300 buildings) MPI should send a request to MOC for its report - The Vietnam Environment and Construction Association is drafting “Strategy on Green Building” and is going to organize a consultation workshop. Requesting for attending Idea of issuing a set of criteria for green building/construction label because, according to him, the current label (Lotus label of Green Building Council) is rather high/difficult to the construction situation in Vietnam in the term of implementation/reality. And of course, it needs some relevant incentive instruments and benefit of label achievement. closed link with MRP
124
* Solid waste management: - Will send some basic information/documents about solid waste such as: Total of the year, ratio of its component, collection and treatment situation, technology but not detail.
28 26 Nov 13
8:00-17:00
Workshop on NAMAs in a MRV Manner in Waste sector
INHEM (MONRE) OECC (Overseas Environmental Cooperation Centre, Japan) ESCAP (Economic and Social Commission for Asia and the Pacific - United Nations)
Vietnam’s nation legal and institutional frameworks for climate change mitigation. Activities to get NAMA ready in Vietnam Overview of NAMA programme in the Waste Sector: “Waste to Resources for Cities in Vietnam” Solid waste management in Hanoi – UIRENCO Hanoi Quy Nhon’s experience on applying approach: “waste to resources” and implementation IRRC project - Quy Nhon CITENCO
29 29 Nov 13
10.00-11.00
Audio Con. With WB, ADB
- Christophe Crepin, World Bank Washington DC - Rehan Kausar, ADB Manila - Lauren N. Sorkin, ADB Hanoi
Discuss on sent slides "PMR Vietnam Status 15.11.12013”. Agreeing structure of PMR and outlines Christophe will send the Consultant a sector strategy and roadmap (Energy Sector ASR for Viet Nam), which covers most topics of Block I Christophe will send mission program for next week concerning the MRP activities
30 3 Dec 13 15:30-17:00
PMR Secretariat WB
Mr. Taisei, PMR Secretariat Mr. Christophe, WB
Agree on structure of proposal Review the slides prepared by consultant about content of draft proposal and orientation MRV, MBIs Focus on storyline of the country, reasons of 3 sector selection. Viewpoints of donors and possibilities questions PMU structure and its component – project ownership
31 4 Dec 13 8:30-10:00
MPI PMR Secretariat WB ADB
Mr. Tuan Anh, MPI Mr. Chung, MPI Mr. Taisei, PMR Secretariat Mr. Christophe, WB
PMU structure and role-play of MPI in implementation Keys issues in Block “Country context”, reasons of 3 sector selection… MPI commits to support consultant in organizing workshop MPI will active in delivering proposal to stakeholders and collecting their comments
125
Ms. Loren, ADB Financial procedure in VN in implementation and in-kind contribution from VN
32 4 Dec 13 14:30-17:00
MONRE PMR Secretariat WB ADB
Madam Ha, ICD - MONRE Mr. Hieu, DMHCC – MONRE Mr. Minh, DMHCC – MONRE Mr. Taisei, PMR Secretariat Mr. Christophe, WB Ms. Loren, ADB
Discuss on PMU structure and role-play of MONRE & MPI in implementation Contribution from VN Keys issues in Block “Country context”, Viewpoint of MONRE on sector selection… MONRE will support consultant in organizing workshop MONRE will cooperate MPI in delivering proposal to stakeholders and collecting their comments
33 4 Dec 13 14:00-16:00
VUREIA URENCO Hanoi
Ms. Nguyet, Secretariat of VUREIA Ms. Huyen, ICD – URENCO Hanoi
VUREIA, its members and role play Interlink among VUREIA and data access/collection: NA URENCO, mechanism of waste collection, transportation and treatment >< fee and budget URENCO-People committee-MOC: cost norm, treatment price and financial system Current treatment system in Lam Son Landfill, its CDM and expectation
34 5 Dec 13 9.00-10.30
MPI PMR Secretariat
Mr. Chung, MPI Mr. Taisei, PMR Secretariat
Review structure and PMU description. MRV system and its components (organizations in charge of collecting data) Agreement on institutional setup for each sector and overall programme Legal establishment and its members according to VN administration Mechanism of operation of PMR under PMU management in future
35 From 8 to 15 Dec 2013
MPI & MONRE Mr. Son, MPI Ms. Nguyet, MONRE
Prepare formal procedures of delivering MRP proposal to line ministries and relative parties for comment
36 16 Dec 13
ADB, WB, MPI & MONRE
Mr. Son, MPI Ms. Nguyet, MONRE
Submit 1st
draft MRP proposal to relative parties (both hard and soft copies)
37
From 18 Dec 2013 to 16 Jan. 2014
ADB, WB, MPI, MONRE, MOC, MOIT, MOT, MOF, VEA, CIEM, JICA,
Deliver 1st
draft MRP proposal and collect their feedbacks Summary up and clarify with them on comment issues Organizing a consultation workshop for presenting about MRP in Vietnam and comment from interested parties.
126
UNDP, UNIDO, GIZ, UNESCAP, VGBC, IMHEN, VSA, VUREIA, URENCO
38 6 Jan 2014
14:30-16:30
MPI, ADB, sector experts
Mr. Tuan Anh, MPI Mr. Chung, MPI Mr. Tuan Anh, sector expert Mr. Phuc, ADB Ms. Loren, ADB
Comments from MPI on 1st
draft MRP Comment from sector expert on sector selection Viewpoint from ADB on 1
st draft MRP structure and its content
Review agenda and activities of consultation workshop on 17 Jan Presentation of MPI on consultation workshop on 17 Jan
39 9 Jan 2014
9:30-11:30
MONRE, ADB
Ms. Tran Minh Ha, ICD-MONRE Ms. Nguyet, , ICD- MONRE Mr. Hoa, DHMCC-MONRE Mr. Minh, DHMCC-MONRE Ms. Loren, ADB
Comments from MONRE on 1st
draft MRP Viewpoint from ADB on 1
st draft MRP structure and its content
Review agenda and activities of consultation workshop on 17 Jan Presentation of MONRE on consultation workshop on 17 Jan
40 16 Jan 14 14:00-15:30
MPI, ADB
Mr. Tuan Anh, MPI Mr. Rehan, ADB headquarter Ms. Loren, ADB
Review collected comments on 1st
draft MRP Discuss about challenge/barriers of MRP MRP and other overlap/synergy projects in VN
41 17 Jan 14 8:00 – 14:00
Consultation Workshop on Vietnam’s market Readiness proposal
Overview of MRP in the selected sectors and MBIs of those Collect comments of relevant ministries and donors, enterprises (data, their roles in MRP, current policies in selected sectors) for improving proposal. Role of MONRE in PMR in the next implementation period and organizational setup.
42
From 18 Jan to 9 Feb 2014
MPI, MONRE
Collect the some late comments on 1st
draft MRP Discuss on comment/feedback with related parties Collect and update data for revising 1
st draft MRP
Revise 1st
draft MRP
43 10 Feb. 2014
ADB, WB, MPI & MONRE
Submit 2
nd draft MRP proposal with the incorporated comments from the
stakeholders
127
44 12 Feb. 2014
15:00 – 17:00
ADB, MPI & MONRE
Mr. Tuan Anh, MPI Mr. Truong Son, MPI Madam Tran Thi Minh Ha, MONRE Mr. Nguyen Khac Hieu, DHMCC - MONRE Ms. Yen, DHMCC, MONRE Mr. Pham Quang Phuc, ADB
Discuss about data used in MRP proposal and availability of reliable updated data Discuss again about organizational set-up and Project Management Unit - Deadline for input from MPI and MONRE regarding this issue for finalizing MRP. Vietnam’s contribution for the MRP implementation budget Selected sector and description about transport sector as optional MPI and MONRE will respond ADB’s letter
45 From 11 Feb to 22 March
ADB, WB, MPI, MONRE
Collect comment/feedback from related parties on 2nd
draft MRP proposal Collect updated data/information for revising proposal Discuss further on institutional setup for implementing MRP in the next phase Revise 2
nd draft MRP proposal with updated information and comment.
46 From 26 -27 Feb. 2014
MONRE, MPI Support MONRE to make its presentation for PA8 meeting in Mexico city about MRP.
47
From 5 to 22 Mar. 2014
MONRE, MPI, ADB, WB, UNDP, UNIDO, JICA, GIZ, UNESCAP, IMHEN, OECC …
Collect information (planning, working on, …) about other projects covered the same sectors, purposes as MRP in Vietnam Exchange information about MRP’s scope of work, activities, time frame… with other project donors for identifying synergy/overlap among those. Such as: UNDP: implement “ energy efficiency improvement in commercial and high-rise residential buildings in Vietnam” UNDP + UNIDO: implement “development of GHG baseline, future emission scenario and a MRV system for steel sector with the aim of planning NAMA development” GIZ : implement “ development MRV system in Vietnam” focus on institutional and carry out pilots based on this system IMHEN: Capacity building cooperation and Joint Study project in NAMAs in a measurable, reportable and verifiable manner in the waste sector
128
48 24 Mar. 2014
ADB, WB, MPI & MONRE
Submit 3
rd draft MRP proposal with the incorporated comments
49
25 Mar. to 21 April 2014
ADB, WB, MPI & MONRE
Collect comment/feedback from related parties on 3rd
draft MRP proposal Discuss further on institutional setup for implementing MRP in the next phase
50 20 March 14
16:00-17:00
JICA Ms. Michiyo Kakegawa
Share information of waste sector OECC (Japan) and IMHEN have implemented the solid waste in Vietnam relating to identify baseline and NAMA scenarios, Domestic guidelines for a NAMA selection, domestic guidelines for MRV of NAMAs in the waste sector, proposal of a modality for domestic institutional arrangement for NAMA implementation, technology needs assessment. JICA planned to start the project “ emission inventory” and cooperate with DMHCCC-MONRE
51
From 22 Mar to 21 April 2014
MONRE, MPI
Support MONRE, MPI to organise the Development Partner Coordination Meeting (participants, agenda, content of MRP, presentation…)
52 16 April 2014
14:00-16:30
MONRE, MPI
Mr. Pham Van Tan – MONRE Dr Luong Quang Huy - MONRE Ms. Minh Nguyet, Mr. Nhat, Mr. Toan, Ms. My (MRP team of MONRE) Mr. Truong Son, MPI
Viewpoint of new MONRE’s team on sector selection and MRP proposal content and its implementation Review budget table and MRP activities. Review presentation for Development Partner Coordination Meeting on 22 April 2014 Review meeting agenda and its activities.
53 21 April 2014
15:00-16::30
PMR secretariat MONRE
Mr. Taisei, PMR Secretariat Mr. Christophe Crepin, WB Mr. Pham Van Tan – MONRE Dr Luong Quang Huy - MONRE
Review preparation for Development Partner Coordination Meeting: participant list, agenda, logistic… at MONRE building Presentation of MONRE about MRP Viewpoint of new MONRE’s team on sector selection and MRP proposal content and its implementation. Clarify MRP phase and its activities
129
Ms. Minh Nguyet, Mr. Nhat, Mr. Toan, Ms. My (MRP team of MONRE)
53 22- April 2014
8:30 – 17:00
Development Partner Coordination Meeting
ADB, WB, MPI, MONRE, MOC, MOIT and related donors (NGOs), partners (association and enterprises)…
Framework of NAMAs and other mitigation measures in Vietnam Donors share their implementing program in Vietnam relating to selected sectors of MRP (identify synergy/overlap with MRP) MOIT: overview of NAMAs in steel sector MOC: overview of NAMAs in solid waste and energy efficiency in building sector Project information from other NGOs: UNDP, JICA,UNIDO…
54 23 April 2014
8:30-12:00
PMR Expert In-Country Review Meeting
Ms. Xueman, Mr. Taisei, Mr. Dian, Mr.Vinay, Mr.Ashar – PMR Ms. Laura, WB Mr. Rehan, ADB Mr. Pham Van Tan – MONRE Dr Luong Quang Huy - MONRE Ms. Minh Nguyet, Mr. Nhat, Mr. Toan, Ms. My (MRP team of MONRE) Mr. Nguyen Tuan Anh, MPI Mr. Hoang Van Tam, MOIT
Present the content of MRP Review MRP proposal Agree on structure of MRP presentation and revise MRP proposal following annex of MRP tool
55 23 April 2014
13:30-16:30
MONRE, WB, PMR
Mr. Pham Van Tan – MONRE Dr Luong Quang Huy - MONRE Ms. Minh Nguyet, Mr. Nhat, Mr. Toan, Ms. My (MRP team of MONRE) Mr.Vinay, Mr.Ashar – PMR
Reconstruct presentation following Annex of MRP tool Timelines for finalizing MRP presentation
130
56 24-April 2014
8:30-18:30
PMR Expert In-Country Review Meeting
Dr Luong Quang Huy - MONRE Ms. Minh Nguyet, Mr. Nhat, Mr. Toan, Ms. My (MRP team of MONRE) Mr. Hoang Van Tam-MOIT Ms. Xueman, Mr. Taisei, Mr. Dian, Mr.Vinay, Mr.Ashar – PMR Ms. Linh Huong MOC
Represent the PMR content Agree on structure of MRP and revising proposal Reviewing available data/information of each sector Suggest to reject Sector “Energy efficiency in buildings”
57 25-April 2014
8:00 -11:30
MONRE, MOC, PMR
Dr Luong Quang Huy - MONRE Ms. Minh Nguyet, Mr. Nhat, Mr. Toan, Ms. My (MRP team of MONRE) Mr. Hoa, Ms. Huong, Ms.Thu, Mr. Khanh, Ms.Kieu Anh – MOC Taisei - PMR
MOC suggest to reject sector “Energy efficiency in buildings” in MRP because there are a lot of sponsored projects support this sector MOC establishes the team and focal point in MRP ( Ms. Luu Linh Huong) Discuss about solid waste sector: situation, activities and gap… and suggested support activities Agree deadline of providing information with evident documents about solid waste sector to consultant for finalizing MRP
58 25-April 2014
14:00-16:30
MPI, MONRE, MOC, PMR
Dr Luong Quang Huy - MONRE Ms. Minh Nguyet, Mr. Nhat, Mr. Toan, Ms. My (MRP team of MONRE) Mr. Hoa, Ms. Huong, Ms.Thu, Mr. Khanh, Ms.Kieu Anh – MOC
Officially, MOC and MPI removed sector “Energy efficiency in buildings” out of MRP MOC will send official letter in order to inform this conclusion of meetings to MONRE and MPI Working plan from 26/4-12/5/2014 regarding providing information, data and finishing MRP
131
59 25-April 2014
10:00-12:00
MONRE, MOIT, PMR
Dr Luong Quang Huy - MONRE Ms. Minh Nguyet, Mr. Nhat, Mr. Toan, Ms. My (MRP team of MONRE) Mr. Tam, MOIT Taisei - PMR
Discuss about steel sector: situation, activities and gap… and suggested support activities Agree deadline of providing information with evident documents about steel sector to consultant for finalizing MRP
60 26-April 2014
10:00-12:00
MONRE – MRP team
Dr Luong Quang Huy - MONRE Ms. Minh Nguyet, Mr. Nhat, Mr. Toan, Ms. My (MRP team of MONRE)
Agree on scheme of cooperation in finalizing MRP Agree deadlines of providing updated data/information about sectors (situation, gaps, expected support activities, incentive tools), institutional setup with detail description, budget allocation and VN contribution, … for finalizing MRP Agree on deadline of reviewing final draft MRP, presentation
132
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