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Asian Development Bank
CMI Technical Support Facility Exclusive Team Briefing
Manila, 18 June 2009

CDM in Vietnam – An Update
Ha Dang Son
RCEE Energy and Environment
Vietnam

Outline

 CDM status of Vietnam

 DNA and CDM approval process

 Major CDM issues in Vietnam

2 | TSF Team Briefing – Climate and Clean Energy Week, 15-19 June 2009

Vietnam at a glance
Area: 331,211.6 km2
Population: 86,210,800
GDP per capita: USD 1,034
Growth rate: 8.46%
Labor structure:
o 52.6% in agriculture, forestry and

fishery
o 20.8% in industry and construction

o 26.6% in services

Agricultural land: 24.7m hectares
o 9,4m hectares production land

o 14,5m hectares forest land

(General Statistics Office, 2008)

CDM Status

 5 CDM projects have been
registered (as of May 2009)
 Rang Dong Oil Field Associated Gas
Recovery and Utilization
 Song Muc Hydropower Plant
Rehabilitation
 Dong Thanh Landfill LFG Recovery
 Binh Thuan 30MW Wind Power
Plan No.1
 Cao Phong Reforestation Project


Registered CDM by region CER issuance by region
60% 60%

50% 50%

40% 40%

30% 30%

20% 20%

10% 10%

0% 0%
China India Malaysia Korea Thainland Vietnam China India Korea Brazil Mexcio Vietnam

Vietnam has issued 4,486,500 CERs and has ranking of
No. 6 around the world!
(Courtesy: TÜV Rheinland)


As of May 2009…
 92 CDM projects have received LOA

 Hydropower plants (SSC, LSC) majorly: 47.7%
 Other renewable energy: wind, biomass (rice husk), biogas
 Waste management: landfill, composting, wastewater treatment
 Energy efficiency, incl. power co-generation
 Fuel switching
 Afforestation & reforestation
 23 CDM projects have received LOE


CDM Potentials and Challenges

 High CDM potential sector:  Other potential sectors:
Renewable energy –  Associated gas recovery
avoidance of GHG emission  Solid and liquid waste
management
 Biomass, biodiesel
 Energy efficiency and
conservation
 Fuel switch
 Afforestation/
reforestation (AR-CDM)


 Challenges
 Low awareness of project entities on CDM, leading to more time
and efforts for documentation and validation
 Low awareness of local bankers on CDM, leading to difficulties in
financing, and benchmark development
 Lack of official data for baseline emission factor (BEF)
development
 Local consultants: limited capacity in terms of language,
technical knowledge, and regular CDM update
 CDM market: newly developed, unstable and not yet
standardized, thus many risks


Designated National Authority
 Institutional Frameworks:
 Viet Nam is a host country under National Steering
UNFCC/Kyoto Protocol (non-Annex 1 country) Committee for
 National Steering Committee (VNNSC) from UNFCCC and KP
14 agencies, with 18 members MONRE MPI
 Ministry of Natural Resources and MOIT MARD
Environment (MONRE) as a National Focal
Agency MOST MOET
 Department of Meteo-Hydrology and Climate MOFA MOJ
Change (DMHCC) of MONRE as DNA of
MOF MOC
Vietnam
MOLISA MOCI

MOCST VUSTA


 CDM Approval Process
Project developer
PIN / PDD
One-door Office PIN
No
CDM criteria
Yes - 25 days
Vietnam DNA LOE

Projects developer
PDD

VNNSC No CDM criteria
Yes - 50 days
Vietnam DNA LOA

Validation and
(Courtesy: DNA Vietnam) Registration

DNA’s Priority Activities
 Capacity building
 Research and predict CERs market
 Guidance to organizations/enterprises (state and private) to
develop and implement CDM projects
 Propaganda and awareness raising for public and policy makers
on CDM
 Capacity building for DNA and National Steering Committee


 Promotion and facilitation
 Action plan on attracting domestic and foreign investment
capital in CDM-added projects
 CDM integration into environmental conventions and into
national/sectoral/local development strategies and plans.
 Legal documents review for supplementation modification to
support CDM


Failures: Lessons Learnt from DOE
1 3
Limited understanding and Local language and competence
proof of “Additionality”

1 4
Limited evidence for Limited evidence of
CDM consideration Local Stakeholder Process

4
2 Communication between
Missing LoA PD and DOE

2
5
Application of
Data missing during monitoring
outdated methodologies

3 5
Benchmark missing in Data monitoring not according to
host country monitoring methodology

(Courtesy: TÜV Rheinland)

Grid’s Baseline Emission Factor
 Different sources for calculation
 EVN National Dispatching Center’s data: net power generation,
average efficiency and fuel type
 Song Bung 4 HPP (TSF): EF = 569.49 tCO2/GWh

 EVN Institute of Energy’s data: based on fuel consumption and
net power generation
 Binh Thuan Wind Power: EF = 644.8 tCO2/GWh

 5th Master Plan on Power Development: based on total net
power generation, total fuel consumption
 Dong Thanh Landfill: EF = 617.6 tCO2/GWh (AMS-I.D)

 Expected to have official EF by 2010
 MONRE’s request to MOIT to provide official EF


Benchmark Availability
 Official regulations
 MOIT’s decision on benchmark for SSC power plant
 MOIT’s decision on benchmark for LSC power plant
 State Bank’s regulation on ceiling rate
 Commercial mid-term interest rate
 Not easy to have certified data
 Can refer to IFI sources (WB, ADB, IMF…)


ODA Diversion
 Rationale
 UNFCCC’s rule on ODA diversion
 Hanoi Core Statement on Aid Effectiveness
 Decree 131/2006/ND-CP on ODA Management and Utilization
 Circular 58/2008/TTLT-BTC-BTN&MT 
 Justification and modification
 ODA considered as State’s Budget, registered to state account,
allocated to public agencies/SOEs
 Commercial loan, on-lending: justify terms of loan
 MONRE to consider an option of proportional share of CERs
based on ODA contribution to project’s total capital


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