Renewable Energy in Asia: The Vietnam Report

An overview of the energy systems, renewable energy options, initiatives, actors and opportunities in Vietnam, August 2005

Australian Business Council for Sustainable Energy 3rd Floor, 60 Leicester Street, Carlton Victoria 3053 Tel. +61 3 9349 3077; Fax. +61 3 9349 3049 Email: bcse@bcse.org.au; Website: www.bcse.org.au

Funding This series of reports has been co-funded by the New South Wales Sustainable Energy Development Agency, 2004 and the Australian Business Council for Sustainable Energy. Published September 2005 by the Australian Business Council for Sustainable Energy. Disclaimer The Australian Business Council for Sustainable Energy (the Providers) provides this Report, Overview of the energy systems, renewable energy options, initiatives, actors and opportunities in Vietnam. August 2005 , on the following basis: The Report is not intended to be final or definitive but rather a fairly vigorous preliminary assessment of the market for renewable energy in Thailand. This Report is not intended to be used as the tool for basing financial investment decisions upon, and in all cases the user must conduct sufficient additional analyses and obtain appropriate professional advice before proceeding with any investment decisions. The Providers do not and cannot in any way supervise, edit or control the content of any information or data accessed through the contact details provided in the Report and shall not be held responsible in any way for any content or information accessed. The Providers, along with their servants and agents, are released from and indemnified against all actions, claims and demands which may be instituted against the Providers arising out of use of this Report or of any other person for whose acts or omissions the user of the Report is vicariously liable.

Source: World Factbook,

2005

The views expressed in this publication are those of the authors at the time of writing and are not attributable to the New South Wales Government. Every effort has been made to correctly attribute sources of information. No responsibility is taken for incorrect attributions which may have inadvertently occurred.

Accuracy Whilst considerable care has been taken to ensure the accuracy of the Report, the Australian Business Council for Sustainable Energy would be pleased to hear of any errors or omissions, together with the source of the information.

Table of Contents
1 2 2.1 2.2 2.3 2.4 2.5 3 4 4.1 4.2 4.3 5 5.1 6 6.1 6.2 6.3 7 7.1 7.2 7.3 7.4 7.5 Country Overview........................................................................................................... 1 Current Status of the Vietnamese Energy Sector .......................................................... 2 Supply and Demand ......................................................................................................... 2 Electricity Generation ...................................................................................................... 2 Oil..................................................................................................................................... 3 Coal .................................................................................................................................. 4 Cross Border Electricity Trade......................................................................................... 4 Future Development ........................................................................................................ 4 Sustainable Energy in Vietnam....................................................................................... 5 Solar Photovoltaic ............................................................................................................ 5 Biomass ............................................................................................................................ 5 Hydropower...................................................................................................................... 6 Government Support for Sustainable Energy................................................................ 8 Renewable Energy Action Plan........................................................................................ 8 Barriers to Implementing Renewable Energy Projects ................................................. 8 Legislative ........................................................................................................................ 8 Technical.......................................................................................................................... 8 Financial and Infrastructural ............................................................................................ 8 Projects, Plans and Opportunities .................................................................................. 8 Demonstration Project ..................................................................................................... 8 The International Finance Corporation & Danish Consultant Trust Fund ....................... 9 Wind Resource Mapping ................................................................................................. 9 Small-Hydro Investment ................................................................................................. 9 World Bank Programs ...................................................................................................... 9 7.5.1 Rural Energy I Project ................................................................................................. 10 7.5.2 Rural Energy II Project ................................................................................................ 10

7.5.3 System Efficiency Improvement, Equitisation and Renewables Project (SEIER) ........ 11 7.5.4 Transmission, Distribution and Disaster Reconstruction ............................................ 11 7.5.5 Demand-Side Management & Energy Efficiency Project............................................ 11 7.6 7.7 7.8 7.9 7.10 8 8.1 9 VN-GEF-Rural Energy II (GEF).................................................................................... 12 Promotion of Renewable Energy, Energy Efficienc y and GHG Abatement ................ 12 Global Village Energy Partnershi: ................................................................................. 12 Energy Efficient Public Lighting (UNDP)..................................................................... 12 Large-scale hydropower projects (ADB) ....................................................................... 13 Contact Details............................................................................................................... 13 Indigenous Renewable Energy Companies.................................................................... 13 References...................................................................................................................... 14

Renewable Energy in Asia: Vietnam Report

1 Country Overview
Modern Vietnams independence from French colonial rule, which had been in place since 1884, officially occurred after World War II, but in practice French rule continued until Ho Chi Minhs communist forces took control of North Vietnam in 1954. Foreign forces finally withdrew from South Vietnam in 1975. Today Vietnam has a population of over 83.5 million people with an average age of 26, of which 75% is located in rural areas. Unfortunately, the initial decades of peace in the country had not been matched with economic growth. Though still a communist government, Vietnamese authorities have committed to economic liberalisation and established structural reforms to modernise the economy and produce exportdriven industries. The purchasing price parity GDP is US$227 billion, and GDP is increasing each year at 7.2% and 7.7% in 2003 and 2004 respectively (EIA, 2005). This is allowing Vietnam to make fundamental economic progress and to tackle issues that underlie rural poverty, which include increasing the provision of reliable electricity supplies. Industry is responsible for 40% of the economy, agriculture 22% and services the remainder; however, 30% of the population is considered to be below the poverty line. Industry includes food processing, garments, shoes, machine-building, mining, cement, chemical fertiliser, glass, tyres, oil, coal, steel and paper. Agriculture includes paddy rice, coffee, fish and other seafood, rubber, cotton, tea, pepper, soybeans, cashews, sugar cane, peanuts, bananas and poultry. In terms of climate and topography, Vietnam is tropical in the south and sub-tropical in the north. Summer temperatures commonly exceed 38C and vary little across the country. Winter temperatures drop to 15C in the north due to cold polar air masses in southern Asia. Average annual precipitation is between 1500 and 2000 mm, with most rainfall coming from May to October. Typhoons affect the north and south-western regions. The capital, Hanoi, has an average low of 16C and an average high of 29C.

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Current Status of the Vietnamese Energy Sector

2.1 Supply and Demand The diagram below provides a breakdown of the primary energy supplies in Vietnam. Total energy production in the country is 53 million tones of oil equivalent (Mtoe) with exports of 11 Mtoe. The CO2 emissions (from fuel combustion only) are 57Mt per year.
Source Combustibles, renewables and waste Oil Coal Gas Hydro Share 54.5% 23.5% 12.9% 5.4% 3.7%

Table 1: Breakdown of primary energy supply in 2002

2.2 Electricity Generation Access to electricity has increased rapidly from little over 50% in 1996 to over 87% of current households, and this is expected to increase further with the World Bank's support for the Rural Energy II project due to start in 2005 (EIA, 2005). Nevertheless, much of Vietnam's population still relies heavily on non-commercial energy in the form of biomass resources such as wood, animal dung and rice husks. However, the rural population that is connected to the grid receives only a low quality of service, including low voltage and poor reliability. Vietnams per capita electricity consumption is amongst the lowest in Asia; consequently, typical electrical systems, often developed by local people to provide rudimentary initial power connections, are increasingly unable to meet current and projected load requirements (World Bank, 2004). Rapid commercial sector growth, population migration to major cities and elevated living standards have all contributed to a growing demand for electricity, which is straining current generation capacity. Vietnam had a total electric generating capacity of 8.3 GW in 2002 and generated 35 billion kWh of electricity. Of this, 60% was from hydroelectric power installations. Electricity demand in Vietnam is forecast to grow 1516% per year until 2010. Vietnam currently purchases power from China to prevent shortages in the North (100 million kWh of electricity in 2005) and plans to begin purchasing power from Laos in 2008. To meet this increase in demand domestically, construction or expansion of 32 power stations is planned before 2010, which will cover 7500 MW of new capacity. Electricity of Vietnam (EVN), the state power company, plans to commission 16 hydropower plants by 2010 and increase capacity at the Uong Bi coal-fired plant to 400 MW, while Vinacoal will construct eight additional coal-fired power plants.

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In terms of electricity the following table provides a breakdown of generation sources.

Source Hydro Oil Coal Gas Total GWh/yr 18,198 4,386 4,878 8,334 35,796

Table 2: Electricity production breakdown in 2002

The demand for electrical generation can be broken down as follows:

Use Industry Transport Agriculture Commercial/public service Residential GWh/yr 21,681 300 506 2,020 14,561

Table 3:Electricity demand by sector in Vietnam

2.3 Oil Vietnam has 600 million barrels of proven oil reserves and this figure will probably increase as exploration is ongoing. In 2004 crude oil production averaged over 400,000 bbl/d, making Vietnam the third-largest oil producer in Asia. Vietnams net exports were 193,000 bbl/d of oil in 2004, to markets including the United States, Japan, Singapore and South Korea. The main oil fields are Bach Ho (White Tiger), Rang Dong (Dawn), Hang Ngoc, Dai Hung (Big Bear) and Su Tu Den (Ruby). Despite being a significant oil producer, Vietnam remains reliant on imports of petroleum products because it lacks refining capacity. Vietnams first refinery, the $1.5 billion Dung Quat Refinery (located in Quang Ngai province), is expected to be operational in 2007 and will be able to process up to 140,000 bbl/d. Completion of the Dung Quat Refinery, located in the centre of the country, should lead to greater integration of Vietnam s oil distribution infrastructure, which is currently discontinuous and has the north and south of the country operating largely as disconnected markets. A second oil refinery is being considered for Nghi Son, north of Hanoi (in the Thanh Hoa province). The Vietnamese government estimates that the 150,000 bbl/d plant will cost $3 billion. The Mitsubishi Corporation has agreed to participate in building Nghi Son for completion in 2010. In December 2004, Vietnam contracted a feasibility study for a third oil refinery, to be located at Vung Ro in the southern Phu Yen province. The Vietnamese government plans for the third refinery to be operational within 12 years. Vietnam has proven gas reserves of 0.2 trillion cubic metres but is expected to be able to harness up to 0.28 trillion cubic metres. Both Vietnams natural gas production and its consumption are rising, and both can be expected to increase as additional gas fields start production. A Korea National Oil Corporation (KNOC) lead consortium signed an agreement for facilities to pump and supply 130 Mmcf/d of natural gas in 2002. The natural gas comes from the Nam Con
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Son Basin and will be purchased by PetroVietnam for the next 23 years. In turn, Electricity of Vietnam (EVN) is expected to purchase the gas from PetroVietnam for power plants. In terms of distribution, PetroVietnam and Thailands state-owned oil and gas conglomerate, PTT PCL, has signed a memorandum of understanding (MOU) to assess the viability of a natural gas pipeline network in southern Vietnam. The study is scheduled for completion in late 2005, with the sourcing of investment to build the pipeline undertaken in 2006. Vietnam is also a growing exporter of liquefied petroleum gas (LPG). Since 1999, Japan has been the main consumer of Vietnamese gas exports. Vietnam s LPG sector opened to foreign companies in 1998. Saigon Petro, Elf Gas, Petrolimex, Mobil Unique (a consortium of Mobil, Mitsui, and Unique Gas and Petrochemical), and PTT of Thailand are the major companies involved in the sector. The foreign-owned Dinh Co liquefaction plant, which utilises gas from the Bach Ho field, is the only local producer of LPG in Vietnam . 2.4 Coal Vietnam has indigenous coal (mainly anthracite) reserves estimated at 150 million tonnes. Of this, Vietnam produced over 11 million tonnes in 2002 and has year on year production increases of over 25%. Projections for 2005 by Vincoal are 27 million tonnes with up to one-third for export. Currently Vietnam exports coal to Japan and China mainly, but other export markets for Vietnamese coal include Thailand, the European Union, Mexico and Brazil. Vietnam continues to explore for new sources, and in 2003 a significant coal bed was discovered in the Red River Delta region of northern Vietnam . Vietnam also has the opportunity to partner with foreign firms for coal exploitation, and Vinacoal has recently entered into talks with China s Fujian Province Coal Industry Corporation to jointly exploit the Bac Coc Sau mine in the Quang Ninh province. Vietnam has prioritised the construction of coal-fired power plants, with Vinocoal planning eight new coal-fired power plants by 2010 with a total capacity of 2900 MW. Six are already at various stages of planning and construction. Coal-fired power plants are expected to account for 25% of Vietnam s total electricity production in due course, with up to about 10 million tonnes of coal per year required to meet projected production levels (based on projected demand of 20,000 MW by 2010). 2.5 Cross Border Electricity Trade Vietnam does not import or export electricity.

Future Development

The Vietnamese government is focused on increasing access to electricity in the country, with a current target of 90% of the population as part of its commitment to reducing rural poverty. Extension of the national grid has been focused on connecting densely populated urban areas, whereas in rural areas the government has been focused on the use of local hydroelectric power. EVN plans to develop a national electricity grid by connecting together several regional grids. The country's distribution infrastructure has benefited from recent improvements including a $56 million northsouth power line transmitting power from Vietnam's largest generator, the Hoa Binh hydropower plant in the north, to large population centres in the south. This World Bank-funded project has also had the affect of alleviating electricity shortages in Ho Chi Minh City. Vietnam is now assessing the construction of a 500 kV, 188-mile power line from Pleiku to Danang City. EVN have also announced plans to upgrade transmission lines surrounding Hanoi (EIA, 2005).

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The Vietnamese government estimates that 9,300 miles of new high voltage transmission lines and 173,600 miles of new medium and low voltage transmission lines will be necessary to accommodate demand by 2010. The high cost of grid extension and the countrys geographical complexity will preclude the inclusion of some 1,100 remote or mountainous communities. These communities have 750,000 households and about three million people, though some already have access to commercial electricity through local small grids and local power production from sources like small hydro plants.

Sustainable Energy in Vietnam

Over 50% of Vietnamese people live without electric power and only some can be expected to be electrified via the national grid. There exists, therefore, a considerable potential role for hydroelectricity, biomass and solar power. This includes both grid-connection of the larger renewable energygy systems, and a considerable market for renewable systems for the many communities and houses that are likely to remain off-grid. The major renewables implemented in the country so far are biogas digesters, windmills for water pumping, solar water heaters and mini-hydropower plants (PRESSIA, 2000). 4.1 Solar Photovoltaic Vietnam has a relatively good solar resource, with solar radiation from 34.5 kWh/m 2/day in winter to around 4.56.5 kWh/m 2/day in summer. Solar energy is an ideal source to meet the off-grid needs especially in the more diffuse pollution areas where mini-grids are not feasible. The major organisations active in implementing solar energy systems are the Solar Laboratory of Vietnam Science Institute (Solarlab) based in Ho Chi Minh City, the Institute of Energy in Hanoi (which is a part of EVN within the Ministry of Industry) and the Renewable Energy Centre of the Hanoi University of Technology. There is also a major SELCO project, in cooperation with the Vietnamese Women Union, which has over 600 systems in operation. There are three types of systems that define the Vietnamese PV market: o individual home systems o o village facilities (common lighting, audio, television) energy centres for recharging batteries

PV modules are generally imported while some balance-of-system components are locally manufactured. The national telecommunication company and EVN own subsidiaries for the design and installation of solar electric systems for their own internal needs. Under a solar power cooperation program between Solarlab, the French Ministry of Foreign Affairs, Electricite de France, and the European Union, the Vietnamese-French Friendship Solar Station was established in Ho Chi Minh City to provide a program of solar electricity provision in the provinces of Gia Lai, Quang Nam and Bin Phuoc (EIA, 2005). Over the last five years, some 1270 household PV systems have been installed in provinces of the southern region. In addition, a number of systems, ranging in capacity from 500 Wp to 1500 Wp, have been installed in hospitals, schools and village communities. 4.2 Biomass Biomass, including wood fuel and agricultural residues (rice husk, rice straw, coffee husk, bagasse etc.), is widely used for energy production in Vietnam. Biomass fuels sources that can also be developed include forest wood, rubber wood, logging residues, saw mill residues, sugar cane residues, rice residues and coconut residues.
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Biogas is another untapped resource for Vietnam. Over 50 million tonnes of biomass is created each year with only 3040% currently used for energy production. What is captured is generally used for cooking in households and a small amount is used for electrical generation in sugar mills (approximately 150 MW). Currently biomass is generally treated as a non-commercial energy source, and collected and used locally. The use of biomass for producing energy in a commercial sense has not received the attention of energy planners in the same way as sources such as solar power and hydroelectricity.
Sector Type of end use cook-stoves small kilns large kilns Electricity TOTAL co-generation 8,805 915 1,950 Fuel wood (KTOE) 6,997 663 1,145 Rice husk (KTOE) 665 140 110 Rice straw (KTOE) 1,950 Bagasse (KTOE) 165 100 377 642 1,688 Others (KTOE) 890 100 698 Total

Heat

10,667 903 2,053 377

Table 3: Consumption of biomass energy by type and end-use in 2000 in Vietnam (Duc Gong, 2004)

Type of biomass

Total main biomass amount produced ('000 tonnes) 6,000 5,000 440

Total available biomass amount ('000 tonnes) 2,300 4,200

Potential of estimated electricity capacity (MW) 70150 150200 5 3050

Rice husk Bagasse Wood residues Wastes and other biomass

Table 4: Potential of biomass for electricity generation

4.3 Hydropower In 2003 hydroelectric power in Vietnam provided 50% of the nation's total electrical capacity of 6000 MW. Of this, grid-connected mini-hydro systems were generating about 60 MW of power, from 48 distinct systems ranging from 100 kW to more than 7.5 MW. Vietnam currently has five hydro developments underway, financed by the government or international assistance programs. o The Son La project. Construction begins in 2005. Intended to be generating 2400 MW by 2012, which will make it the largest hydro project in Vietnam. o o o The Ban Ve hydropower plant. Construction began in September 2004 and commissioning is due in 2008. The Dong Nai 3 and Dong Nai 4. These are EVN projects in the Central Highlands with a combined capacity of 500 MW. The EVNs Se San 4 hydropower plant in the provinces of Gia Lao and Kon Tum. Construction began in December 2004. The plant will be 330 MW and generate 1.4 billion kWh per year. Vietnam also plans to build three additional plants in the same region before 2010.
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Renewable Energy In Asia: The Vietnam Report

In addition to grid-connected hydro, there are more than 300 independent hydro-grids with a collective capacity of 70 MW. Individually these systems range in capacity from 5 to 200 kW. A key problem has been reliability and it is estimated that only a third are currently operational. Even smaller household scale micro-hydro systems are proving important in isolated rural communities located far from the grid but close to suitable water courses. Vietnam has one of the worlds largest markets for such small hydro systems in which up to150,000 generation kits have been sold. Such systems provide between 100 and 1000 watts. However, poor quality systems account for around 90% of sales because they are cheap and affordable to poorer rural buyers, however, the low quality means high maintenance costs which can exceed the initial capital cost. Another problem with the cheaper systems is that voltages vary with water flow and can damage electrical appliances. Also, safety standards are less than adequate. Vietnam has a significant internal manufacturing capacity in the hydro sector. Engineers at the Institute of Materials Science (IMS) of the Vietnam National Centre for Natural Sciences and Technology (NCST) have designed three new types of micro-hydro system suitable for different types of water flow. These are now being exported to New Zealand, Nepal, Papua New Guinea and the Philippines. Importantly, Vietnam also manufactures its own mini- and micro-hydro components for systems up to 2 MW capacity. Locally manufactured components cover various types of turbines (Francis, Kaplan, Pelton, Crossflow and Propeller) and associated equipment for installations. The Vietnamese energy master plan recommends the establishment of a Small Hydropower Development Authority (SHPDA) to re-start investment in the sector, which has been depressed for some years. A key objective of the SHPDA would be to stimulate a pipeline of bankable on- and off-grid small hydro projects by building local human capacity. It is estimated that investments in this least-cost remote power source could reach US$20 million over a five-year period.

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Government Support for Sustainable Energy

5.1 Renewable Energy Action Plan In 1999 the government launched a Renewable Energy Action Plan (REAP). This set out a 10-year framework to be delivered in two 5-year phases of international assistance to scale up the development and use of renewable energy for rural electrification and grid supply. It was developed jointly by EVN and the World Bank. There are a significant number of foreign investments and aid-funded projects underway in Vietnam which affect policy making and delivery of renewable energy, and these are presented in detail in the Projects, Plans and Opportunities section below.

Barriers to Implementing Renewable Energy Projects

The following comments regarding barriers to implementing renewable energy projects in Vietnam are taken from the 1999 Vietnam REAP workshop (Quyen et al., n.d.). 6.1 Legislative The current policy and regulatory framework for encouraging the use of renewable energy is inadequate to provide the necessary drivers to accelerate the development of the Vietnamese renewable energy industry. 6.2 Technical The following are some of the key barriers identified by the REAP workshops: o insufficient awareness of the available technologies, their costs and performances o o o a lack of reliable data on biomass energy sources a shortage of high quality technology at affordable prices the high cost of biomass conversion technologies that are imported and therefore expensive.

6.3 Financial and Infrastructural With regard to financing and provision of infrastructure, the following issues have been identified: o a lack of commercial businesses and infrastructure to provide renewable electricity equipment and services o o the continuing high costs of biomass conversion technologies and therefore of energy generated from biomass limited access to finance for consumers, businesses and project developers.

Projects, Plans and Opportunities

The following are descriptions and extracts from existing or proposed projects, plans and business opportunities in Vietnam which are relevant to the sustainable energy industry. 7.1 Demonstration Project (NEDO) The government of Japan has been providing assistance for activities including a New Energy and Industrial Technology Development Organisation (NEDO) demonstration project for a hybrid
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solar/micro-hydro system in Gia Lai province, and plans for the electrification of 265 communes in 17 northern provinces through micro-hydro, solar or wind (2000 data). 7.2 The International Finance Corporation (IFC) and the Danish Consultant Trust Fund The IFC and the Danish Consultant Trust Fund provided resources for a series of projects that resulted in the Master Plan for Rural Electrification for Vietnam. 7.3 Wind Resource Mapping (NL) The Netherlands Partnership Program provided resources and materials for the creation of a macro-level wind resource map of Vietnam and for community-level training and awareness-raising in renewable energy. They have also funded a biogas program which started in February 2003 and will be completed in January 2006. The program objective is to develop a commercially viable and market-orientated biogas industry, increasing the number of family-sized, quality biogas plants. 7.4 Small-Hydro Investment (NZ) The New Zealand government has assisted in the preparation of an investments pipeline for new small hydro sites. 7.5 World Bank Programs The World Bank's support to the energy sector in Vietnam focuses on four themes: i. improving energy access to the rural areas ii. helping the country mobilise finance for meeting the rapidly growing demand iii. improving the technical, commercial and financial efficiency of the energy system iv. initiating a reform of the sector, including market restructuring, sector and corporate governance. Since the start of its operations in Vietnam, the World Bank has approved over $1 billion in credits including: o Rural Energy I ($150 million, May 2000) to connect 900 communes to the national power network o o Rural Energy II: includes major upgrading and/or expansion of rural power networks in about 1200 communes System Efficiency Improvement, Equitization and Renewable Project (SEIER $225 million, June 2002) to improve technical, commercial and financial efficiency of EVN and the power companies Transmission, Distribution and Disaster Reconstruction Project ($199 million, February 1998) to reinforce the existing northsouth transmission system and rehabilitate distribution systems in three cities Demand-Side Management & Energy Efficiency Project

These projects have been supported by a significant volume of studies and technical assistance work. Some of the major studies were: Implementing the Gas Master Plan (199899); Fueling Vietnam's Development: New Challenges for the Energy Sector (19992000); Renewable Energy Action Plan A 10-year Program (20002001); Promoting Private Participation in Infrastructure (20012002); Petroleum Product Pricing Policy (20022003). Refer: http://web.worldbank.org/external/projects/main?pagePK=64283627&piPK=73230&theSitePK=409 41&menuPK=228424&Projectid=P080074.
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7.5.1 Rural Energy I Project The first rural energy project started late 2001. The World Bank Group is financing $2.2 million through ASTAE, the IFC, PHRD, ESMAP, and the Swiss consultant trust fund. New Zealand is cofinancing $0.3 million in alternative energy costs. By the end of 2004, the project aimed to have connected over 900 communes to the national grid thus providing electricity to over half a million new households. Over 600 construction contracts designed to maximise local contracting industry participation created a major employment potential and the foundation of an efficient local construction industry in the districts. The project not only provided electricity to the communes, it also laid the foundation for local employment and management by training two to three people in most communes to be service agents responsible for routine operations and maintenance as well as commercial activities such as billing and collection. Contact: Van Hung Tien, The World Bank 7.5.2 Rural Energy II Project It is expected that in the next seven years the project will complete: o major upgrading and/or expansion of rural power networks in about 1200 communes o conversion of current ad-hoc local electricity management systems to local distribution utilities (LDUs) as legal entities recognised under Vietnamese law, to improve management of power distribution in rural areas, improve financial sustainability, and better enable future mobilisation of private funds capacity-building assistance for the LDUs, provincial authorities, participating regional power companies, and national authorities involved in the planning and regulation of rural electrification.

The project will secure efficient and reliable power supply for about 2.5 million households, representing more than 50% of those currently without electricity. The project will also enable supply of large increases in electric power for expanding productive uses in rural areas, alleviating a major constraint to local economic growth. World Bank Manager of the Project: Hung Tien, Van.

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7.5.3 System Efficiency Improvement, Equitisation and Renewables Project (SEIER) Bank Team Lead: Pham, Anh Nguyet. Approval Date: 25-Jun-2002. Closing Date: 31-Dec-2007. Implementing Agency: Electricity of Vietnam (EVN)/Ministry of Industry (MOI). The objective of this project is to improve the overall efficiency of power system services, particularly to the poor in rural areas, by optimising the transmission systems and upgrading subtransmissions and medium-voltage distribution lines for rural electrification. The project components are as follows: 1. Power system efficiency will be improved by upgrading the 500 kV and 200 kV transmission networks, and associated substations, which includes the installation of capacitors to selected substations. The system peak load will be reduced through the implementation of several demandside management (DSM) measures to be supported by an associated DSM and Energy Efficiency Project, financed by the Global Environment Facility and the private sector in an aim to further DSM impacts and catalyse the development of sustainable energy efficiency. 2. Rural electricity access will be improved by upgrading and strengthening the 110 kV subtransmission line, and substations, restoring five existing hydropower plants, and by construction of a small-scale hybrid wind/diesel power plant at Phu Quoc Island. Moreover, a pilot of 20 community-based hybrid renewable-energy grids in remote areas will be tried and developed. 3. Sector reform and institutional development will be pursued through improvements in the management information system, the creation of one District and several commune-level joint-stock distribution companies, and by strengthening the regulation, planning and implementation capacity for renewable electricity. To this end, operational training and technical assistance will be provided. The project will support Phase 1 of the Renewable Energy Action Plan (REAP) developed jointly by EVN and the Bank, and adopted by the Ministry of Industry. SEIER will support renewable energy policy development, pilot community-scale microhydro, development of grid-connected small power producers, and rehabilitation of small hydro facilities owned by EVN. It will also include a follow-on component to the Sida-supported DSM program and include a second phase utility DSM program and a pilot commercial energy efficiency program. Estimated Bank/GEF support for alternative energy is $20 million 7.5.4 Transmission, Distribution and Disaster Reconstruction The project is financing the expansion of transmission systems in south and central Vietnam, and rural electrification in selected areas. The Swedish SIDA-supported DSM component consists of technical assistance to prepare a DSM policy and regulatory framework, load management program and energy efficiency standards and codes. The SIDA commitment stands at $3.0 million. 7.5.5 Demand-Side Management & Energy Efficiency Project Commenced 2003, completion expected 2007. Total project cost US$ 18.56 . Implementing agency: MINISTRY OF INDUSTRY AND ELECTRICITY OF VIETNAM. The objectives of the Demand-Side Management and Energy Efficiency Project are to: (a) develop and expand demandside management (DSM) business programs and test new market transformation efforts within the national electric utility, Electricity of Vietnam (EVN); and (b) develop sustainable business models and mechanisms to support energy efficiency (EE) retrofit investments in commercial and industrial facilities. The project consists of two components: (i) a second phase DSM component under EVN; and (ii) a pilot commercial EE program under the Ministry of Industry (MoI). The main focus of the first component will be to implement EVN's DSM business plan developed in Phase 1 by: a) expanded time-of-use (TOU) metering by procuring and installing TOU meters; b) pilot direct load control (DLC) Program introduced by using ripple control systems; c) compact fluorescent lamp (CFL) promotion; d) Fluorescent tube lamp (FTL) market transformation; and e) supporting programs and technical assistance for DSM efforts. The second component seeks to test appropriate business models and mechanisms to catalyze a service market to support EE
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investments by supporting commercial service providers or "project agents" in all phases of EE project identification, development and implementation. Specific activities under this component are: a) comprehensive project agent training program to provide basic technical, financial and business knowledge to facilitate the development and implementation of project proposals as well as some customized technical assistance to develop their marketing and business plans; b) subproject audit and investment grants for energy audits and investments to project agents and their customers; and c) program marketing, monitoring and administration including program marketing. 7.6 VN-GEF-Rural Energy II (GEF) This GEF Project approved November 2004, and estimated project cost is $US5.25 million. No project documents are available at present. Contact Richard Spencer at the World Bank, Washington D.C. for further information. 7.7 Promotion of Renewable Energy, Energy Efficiency and Greenhouse Gas Abatement (ADB & NL) In the first phase, which is now complete, the Institute of Energy, a subsidiary of the Electricity of Vietnam Corporation, conducted pre-feasibility studies into hydro, wind, geothermal and biomassbased power generation. In the second phase, which started in January 2005, it will continue to conduct the biomass-based power generation project, draw up plans on a clean development mechanism and guide the designing of a feasibility study on mini-hydropower plants. 7.8 Global Village Energy Partnership: Vietnam Integrated Agriculture and Community Development Project As part of BPs ongoing social investment program in Vietnam, a jointly funded pilot project has been undertaken as a collaborative effort between BP Solar, BP Oil and BP Exploration. In partnership with the Ministry of Agriculture and Rural Development (MARD), the above BP Group Companies will supply a stand-alone central power supply system to a remote non-electrified commune centre nominated by MARD as the enabling and least-cost technology to: o upgrade existing basic survival facilities o o o increase income generating opportunities improve governance train the project partners.

7.9 Energy Efficient Public Lighting (UNDP) Project start: 2000. Building upon a significant volume of study, during the ALGAS phase, this project aims to remove barriers to energy efficiency in the public lighting sector. The ultimate objectives include: (a) to assist local/provincial governments to implement new lighting system with the help of energy efficient technologies; (b) to impact upon energy saving regulations; (c) to facilitate the establishment of national standards for street lighting; (d) to put in place a manufacturing assistance program, lighting management program and training program; and (e) to establish demonstration projects, leading to replication. This project is a PDF-B exercise funded by the Global Environmental Facility (GEF). During this phase, comprehensive studies will be made to identify the barriers hindering the achievement of the above-mentioned goals and to formulate measures to address such barriers. During the next full-scale phase, which is subject to approval by the GEF, the measures identified in PDF-B exercise will actually be implemented to attain energy-efficient public lighting. Contacts:
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Mihoko Kumamoto, UNDP Vietnam. Email: kumamoto@undp.org.vn Thi Thuy Hang, UNDP Vietnam. Email: thuyhang@undp.org.vn Address: Trung Tam Khoa Hoc Tu Nhien Va Cong Nghe Quoc Gia, Phong 307, Nha A9, 18 Hang Quoc Viet, Hanoi, Vietnam. Tel/Fax: (84-4) 756-6489. Email: veepl@netnam.org.vn. 7.10 Large-scale hydropower projects (ADB) The following table lists the large-scale hydropower projects funded by the Asian Development Bank, and their status.
PROJECT INITIAL UPDATED

Phase II of PPTA: Song Bung 4 Hydropower Project Phase I of the PPPTA: Song Bung 4 Hydropower Project Northern Power Transmission Expansion Project Northern Power Transmission Project Se-san 3 Hydropower Project

20 May 2004 25 Nov 2004 30 Jun 2004 1 Feb 1998 15 Feb 1999

10 Aug 2005 9 Mar 2005 13 Dec 2004 22 Apr 2003 26 Aug 1999

Table: 5 ADB-financed hydropower projects in Vietnam. Ref: http://www.adb.org/Documents/Profiles/default.asp?key=ctry&val=PPTA&scpe=30

Contact Details

N.H. Quyen. Email: hongquyen@netnam.vn P.H. Khoi. Email: phkhoi@ims.ncst.ac.vn Head of Institute of Materials Science (IMS) of the National Centre for Natural Sciences and Technology (NCST). Nguyen Duc Cuong ret@fpt.vn Head of Rural Energy Development and New Technology, Institute of Energy, Vietnam 8.1 Indigenous Renewable Energy Companies Name
VnREX VietNam Renewable Energy Xperts

Address
268 bis Ly Thuong Kiet Str, District 10, Ho Chi Minh, Vietnam Tel: (84-8) 865-4355. <www.vnrex.com> 13 Hangmuoi, Hoankiem, Hanoi, HAN, Vietnam 10000. Tel: (84-4) 825-9056 364 HO VAN HUE 2 Str, Ward 9, Phu Nhuan District, Ho Chi Minh, Vietnam 84.

Self-description of products and services

Research and Development Centre of Renewable Energy Equipments. Business type: manufacturer. Product types: solar water heating systems, wind energy system components (small), solar electric power systems, wind turbines (small). Business type: manufacturer, wholesale supplier, importer. Business type: wholesale supplier. Product types: telecommunication batteries, photovoltaic systems.
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Tambaolong Company Viet Thong

Renewable Energy In Asia: The Vietnam Report

August 2005

Vabis Co. Ltd

Tel: (84-8) 847-9425 675B Nguyen Kiem, Ward 9, Phu Nhuan District, Ho Chi Minh City, Vietnam. Tel: (84-8) 997-2966

Product types: remote home power systems, alternative homes and buildings, water heating systems.

In addition, refer database listings, such as: hppt://www.JxJ.com REW suppliers database; and http://energy.sourceguides.com/businesses/byGeo/byC/Philippines/Philippines.shtml .

References

ASTAE (2000), Options for renewable energy in Viet Nam, Report of the June 1516, 1999, twoday workshop in Hanoi, Energy Sector Management Assistance Program (ESMAP),Technical Paper 001. World Bank, Washington, DC. Available online at http://www.worldbank.org/astae/options_for_renewable_energy_in_vietnam.pdf AusAID: http://www.ausaid.gov.au/country/country.cfm?CountryID=33&Region=EastAsia DFAT: http://www.dfat.gov.au/geo/fs/viet.pdf Duc Cuong, Nguyen (2004), Biomass for Electricity Generation in Vietnam, presented at the kickoff Workshop, Information for the Commercialisation of Renewables in ASEAN (ICRA), August 25 27, 2004. Available online at http://www.ptm.org.mj/icra EIA (2005), 'Country Analysis Briefs: Vietnam'. Available online at http://www.eia.doe.gov/emeu/cabs/vietnam.html Quyen, N.H., Khoi, P.H., Dan, N.Q. & Minh, L.T. (2003), The Power of Water. Renewable Energy in Vietnam, TWAS Newsletter, Vol. 15, No. 1:2628. Available online at http://www.ictp.trieste.it/~twas/pdf/NL15_1_PDF/05_RenewableEnergy_21-28_low.pdf Quyen, N.H., Khoi, P.H., Dan, N.Q. & Minh, L.T. (n.d.) Renewable Energy for Rural Areas: Viet Nam, Volume 8: Examples of Successful Uses of Renewable Energy in the South, Institute of Materials Science of the National Centre for Natural Sciences and Technology. Available online at http://tcdc.undp.org/experiences/vol8/Vietnam.v8-9.pdf Renewable Energy Source Guides, Renewable Energy Businesses in Viet Nam. Available online at http://energy.sourceguides.com/businesses/byGeo/byC/Vietnam/Vietnam.shtml Renewable Energy in Asia: http://www.aseanenergy.org/energy_sector/renewable_energy/index.htm; and http://www.aseanenergy.org/pressea/vietnam/vietnam.htm UNDP: http://www.undp.org.vn/undp/unews/mr/2005/eng/0916e.htm; World Bank (2004), $220 Million to Continue Bringing Power to the Poor People of Rural Vietnam, media release, World Bank, Hanoi, December 6.

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