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Asia Least-cost Greenhouse Gas Abatement Strategy

Viet Nam

Asian Development BankGlobal Environment Facility

United Nations Development Programme

Asia Least-cost Greenhouse Gas Abatement Strategy

Viet Nam

Asian Development Bank Global Environment Facility


Manila, Philippines October 1998

The use of the material printed herein is encouraged, with appropriate credit, given to the publishers and authors. Please address inquiries to Chief, Office of Environment and Social Development, Asian Development Bank, P.O. P.O. Box 789, 0980 Manila, Philippines.

Printed and published in Manila, Philippines.

© Asian Development Bank

Publication Stock No. 070698 ISBN 971-561-186-9

his report is the outcome of a country study conducted under the ALGAS project by Viet Nam. ALGAS, which stands for “Asia Least-cost T Greenhouse Gas Abatement Strategy,” is a study by 12 Asian countries

of national emissions of greenhouse gases (GHGs) in 1990, the projections of GHGs emissions to 2020, and an analysis of GHGs abatement options in different economic sectors. The study includes the formulation of national GHGs abatement strategies consistent with national development priorities, and the preparation of a portfolio of GHGs abatement projects and national action plans embodying national development objectives.

during 1995-1998 with funding of about $9.5 million from the Global Environment Facility (GEF) through the United Nations Development Programme (UNDP). The ADB also provided supplemental funding of $592,000. The Government of Norway and the Governments of participating countries likewise provided financial and in-kind contributions, respectively, to the project. With a budget of more than $10 million, this is the largest regional technical assistance project executed by the ADB. Apart from Viet Nam, the countries involved in the study are Bangladesh, People’s Republic of China, India, Indonesia, Republic of Korea, Mongolia, Myanmar, Pakistan, Philippines, Thailand, and the Democratic People’s Republic of Korea (DPRK). For DPRK, the country study is being executed by the United Nations Economic and Social Commission for Asia and the Pacific (UN ESCAP). Together, these countries contain more than one-half of the world’s population. The ALGAS project was designed to assist the countries to meet their commitments under the United Nations Framework Convention on Climate Change.

A team of national technical experts (NTEs) undertook each country study, with the active involvement of Governments through a designated national counterpart agency (NCA). The NTEs were drawn from different institutions of each country, and were assisted in their tasks by a team of international technical experts (ITEs). The ALGAS project involved a number of regional capacity-building activities, including training workshops on GHGs inventory preparation, analysis of GHGs mitigation options, empirical measurements of methane from rice paddies, analytical modeling of the energy and forestry sectors, and the preparation of project pre-feasibility reports. It also included study tours, supply of equipment, and a regional database. A regional thematic support group of experts who have contributed to the study was organized to help continue cooperation among the participating countries. The Environment Division, Office of Environment and Social Development of the ADB, with the active support of UNDP-GEF coordinated the study. The UNDP country offices provided significant logistics support and encouragement to the NTEs teams.

In the case of Viet Nam, the NCA was the Institute of Meteorology and Hydrology (IMH) of the Hydrometeorological Service. The NTEs team, which was led by experts of IMH, included experts of the Institutes of Agricultural Planning and Projection; and Forest Science; Electricity of Viet Nam; Ministries of Industry; Training and Education; Transportation; Science, Technology and Environment; and Agriculture and Rural Development; and Planning and Investment. At different stages of the study, the NTEs team conducted several national workshops in which interim results were presented and feedback obtained from government agencies, industry, researchers, and NGOs.

The ALGAS project was executed by the Asian Development Bank (ADB)

VIET NAM

PREFACE

PAGE I

PREFACE

NATIONAL TECHNICAL EXPERTS

TEAM

PAGE II

The ITEs team included experts of Alternative Energy Development Inc. (US) in association with Asian Institute of Technology (Thailand); Australian Bureau of Agricultural and Resource Economics; Hagler Bailly Services (US); ICF Kaiser (US); and Lawrence Berkeley National Laboratory (US). A number of institutions in the participating countries helped conduct various capacity- building activities. The ITEs team included several members from the region who were concurrently members of their respective NTEs teams. A group of independent international reviewers carried out peer reviews of each country study.

The completion of this report, together with its companion volumes on the other 11 participating countries and the Regional Summary report, is an indication of the success of this regional collaborative effort. Each country report comprises, besides an executive summary, chapters on country background; an assessment of energy, forestry and land-use change, and agriculture sectors; formulation of a national least-cost GHGs abatement strategy; a portfolio of least-cost GHGs abatement projects, a national GHGs action plan; and recommendations and future actions. It is hoped that the ALGAS reports would be useful to policymakers, multilateral and bilateral development agencies, the private sector, and researchers in the field both from within and outside the region, particularly those involved with climate change issues.

Asian Development Bank Global Environment Facility


Institute of Meteorology and Hydrology, Hydrometeorological Service of Viet Nam

Nguyen Tuong, Nguyen Khac Hieu

Institute for Agricultural Planning and Projection

Nguyen Duc Ngu, Nguyen Trong Hieu (Project Coordinator), Le

Duong Anh Tuyen, Vu Nang Dung

Electricity of Viet Nam Nguyen Phu Gia

Institute of Forest Science Ha Chu Chu, Hoang Xuan Ty

Ministry of Industry Nguyen Dong Lam, Ngo Duc Lam

Ministry of Training and Education Nguyen Minh Due

Ministry of Transportation Nguyen Van Siem

VIET NAM

PREFACE

Ministry of Science, Technology and Environment Pham Quoc Hiep

Ministry of Agriculture and Rural Development Nguyen Trong Sinh

Ministry of Planning and Investment Le Minh Duc

Alternative Energy Development, Inc. US

CERI Curves), Keith Openshaw (Forestry)

Asian Institute of Technology, Thailand

Matthew Mendis (Team Leader), Marcia Gowen (GHGs Mitigation,

Thierry Lefevre (EFOM/ENV and MEDEE-S/ENV Modeling)

Australian Bureau for Agricultural Resource Economics Brian Dawson, Barry Naughton, Kenneth Noble (MARKAL Modeling)

Bangladesh University of Energy and Technology Ijaz Hossain (GHGs Mitigation)

Hagler Bailly Services, US Amit Bando (National Work Plans, Project Development)

ICF Kaiser, US Craig Ebert, Barbara Bratz (GHGs Inventory)

Indian Institute of Science, India N.H. Ravindranath (Forestry)

International Rice Research Institute, Philippines Rhoda S. Lantin (Agriculture)

Lawrence Berkeley National Laboratory, US

Curves, Project Development)

National Physical Laboratory A.P. Mitra (GHGs Inventory)

Jayant Sathaye, Allan Meiers, Stephen Meyers (GHGs Mitigation, CERI

Institute for the Study of the Earth, Oceans and Space, University of New Hampshire, US

Berrien Moore III (GHGs Inventory)

UNEP Collaborating Centre on Energy and Environment, RISi National Laboratory, Denmark

Kirsten Halsnaes (GHGs Mitigation)

VIET NAM

INTERNATIONAL TECHNICAL EXPERTS

TEAM

EXTERNAL PEER REVIEWERS (FOR

THIS COUNTRY STUDY)

PAGE III

he Asian Development Bank (ADB) and the United Nations Development Programme (UNDP) are pleased to have had the T opportunity to join in working on the Asia Least-cost Greenhouse

Gas Abatement (ALGAS) Project. This is one example of our successful collaboration. We are particularly gratified to note the hard work put in by the country project teams and the international consultants to achieve a successful outcome of this Project. The commitments shown by the participating parties is a positive sign that efforts will be carried forward into follow-up work. We believe that this Country Report, the ten accompanying Country Reports, and the Summary Report, which have been released on the occasion of the Fourth Meeting of the Conference of the Parties to the United Nations Framework Convention on Climate Change in November 1998 in Buenos Aires, will be useful to the policymakers, donor agencies, researchers, and the broader Climate Change community. We hope that they will lead to further concrete steps by all of these parties to ensure that the work undertaken to date will bear fruit in significant action to mitigate climate change.

Kazi F. Jalal Nay Htun Chief, Office of Environment and Social Development ADB Headquarters UNDP Headquarters Manila, Philippines New York, USA

Assistant Administrator and Regional Director for Asia and Pacific

VIET NAM

FOREWORD

PAGE v

ACKNOWLEDGEMENTS

PAGE VI

uring the implementation of the ALGAS Project over the past three years, the Project Team at the Asian Development Bank has received D help, support, and guidance from many individuals and

organizations. It is unlikely that we would be able to mention them all, let alone express our gratitude in full.

In respect of the Viet Nam Country Report, we are grateful for the guidance, kindness, and support of Nguyen Duc Ngu and his colleagues in the Hydrometeorological Service of Viet Nam.

Experts (NTEs) teams, which prepared this report, and the International Technical Experts (ITEs) team, which provided assistance at different stages, members of which are listed separately in this report. Robert Lee of Alternative Energy Development, Inc. helped in the coordination of the different NTEs teams and in the technical editing of this report. Ida Juliano of Tetra Tech EM Inc. formatted the report and designed the layout.

The GHGs Inventory part of the Viet Nam Country Report was peer- reviewed by Berrien Moore III of the University of New Hampshire, United States, and the GHGs Mitigation component by Kirsten Halsnaes of the UNEP Collaborating Centre on Energy and Environment, RisAE National Laboratory in Denmark.

Headquarters provided significant help and support in the implementation of the Project. Edouard Wattez and his colleagues in the UNDP Country Office in Hanoi were relied upon at different stages to follow-up on various matters with the NTEs team and the Government of Viet Nam, and provided logistics support. Coordination between the ADB, UNDP Headquarters, and the UNDP Country Offices was greatly facilitated by Sarah Timpson, Jorge Reyes, and Clarissa Arida of the UNDP Country Office in Manila.

of Kazi Jalal of ADB Headquarters, Manila. Assistance was also provided by Jean-Pierre Verbiest and his colleagues in the ADB Resident Mission in Viet Nam. Finally, the efficient management of the Project owes a great deal to the ever-patient, helpful, and meticulous Annie Idanan.

The usual disclaimer applies. The ideas and methods presented in this report are the work of the NTEs and ITEs teams, peer-reviewers, and ADB and UNDP staff who collaborated in the preparation of the report, and do not represent the official policies or positions of ADB, GEF, and UNDP.

We are grateful for the dedicated efforts of both the National Technical

Nay Htun, Richard Hosier, and Nandita Mongia of the UNDP

The Project Team worked under the close guidance and encouragement

Prodipto Ghosh Senior Environment Specialist and ALGAS Project Officer

Bindu N. Lohani Manager, Environment Division and ALGAS Project Supervisor Asian Development Bank Manila, Philippines

VIET NAM

CONTENTS

PREFACE I NATIONAL TECHNICAL EXPERTS TEAM ................................................... II INTERNATIONAL TECHNICAL EXPERTS ................................................... III EXTERNAL PEER REVIEWERS (FOR THIS COUNTRY STUDY) ............................. V

FOREWORD ................................................................................................................. V ACKNOWLEDGEMENTS .................................................................................................. VI LIST OF TABLES .......................................................................................................... X LIST OF FIGURES ....................................................................................................... XV

LIST OF ABBREVIATIONS ........................................................................................ XVIII

1.1 1.2 1.3 1.4

COUNTRY PROFILE AND STATUS OF CLIMATE CHANGE ACTIVITIES ........ 3 1993 NATIONAL INVENTORY OF GHGs SOURCES AND SINKS ................ 4 BASELINE PROJECTION OF NATIONAL GHGs INVENTORY TO 2020 ...... 5 GHGs MITIGATION OPTIONS ..................................................................... 6 1.4.1 ENERGY SECTOR ............................................................................. 6 1.4.2 FORESTRY SECTOR .................................................................... 7 1.4.3 AGRICULTURE SECTOR ................................................................... 7

BASELINE AND ABATEMENT SCENARIOS TO 2020 ......................................... 7 1.5.1 ENERGY SECTOR ............................................................................... 7 1.5.2 FORESTRY SECTOR .......................................................................... 10 1.5.3 AGRICULTURE SECTOR ............................................................... 10

1.6 NATIONAL LEAST-COST GHGS ABATEMENT CURVES ......................... 12

1.5

1.6.1 ENERGY SECTOR ....................................................................... 12 1.6.2 FORESTRY SECTOR ........................................................................... 13 NATIONAL GHGs ABATEMENT ACTION PLAN ........................................ 15 1.7.1 GHGS ABATEMENT ACTION PLAN IN THE ENERGY SECTOR ........ 18 1.7.2 GHGs ABATEMENT ACTION PLAN IN THE FORESTRY SECTOR ........ 19 1.7.3 1.7.4 PRIORITY GHGs MITIGATION PROJECTS .................................... 21 1.7.5 INSTITUTIONAL MEASURES/INITIATIVES ........................................... 21 CONCLUSION AND RECOMMENDATIONS .................................................... 21

2.1 COUNTRY PROFILE ...................................................................................... 27

1.7

GHGs ABATEMENT ACTION PLAN IN AGRICULTURE SECTOR ...... 20

1.8

2.1.1 GEOGRAPHY .................................................................................... 27 2.1.2 LAND USE PATTERN ......................................................................... 27 2.1.3 SOCIETY ........................................................................................... 28 2.1.4 ECONOMY ........................................................................................... 28 2.1.5 ENVIRONMNT ............................................................................ 29 2.1.6 STATUS OF CLIMATE CHANGE ACTIVITIES .................................. 30

2.2

3.1 3.2

NATIONAL DEVELOPMENT OBJECTIVES ................................................... 30

INTRODUCTION AND BACKGROUND ........................................................... 35 ENERGY SECTOR GHGs INVENTORY ......................................................... 38 3.2.1 INTRODUCTION .......................................................................... 38 3.2.2 METHODOLOGY ........................................................................... 39 3.2.3 DATA SOURCES ........................................................................... 40 3.2.4 RESULTS ...................................................................................... 40 3.2.5 BUSINESS-AS-USUAL SCENARIO PROJECTION OF THE SECTORAL

GHGs INVENTORY TO 2020 .................................................. 42

VIET NAM

SECTION 1 EXECUTIVE SUMMARY

SECTION 2 INTRODUCTION AND

BACKGROUND

SECTION 3 ENERGY ASSESSMENT

PAGE VII

CONTENTS

SECTION 4 FORESTRY AND LAND-USE

CHANGE ASSESSMENT

SECTION 5 AGRICULTURE ASSESSMENT

PAGE VIII

3.2.6 LIMITATIONS OF THE GHGs INVENTORY DATA ...................... 43

SECTOR GHG ABATEMENT OPTIONS ..................................................... 44 3.3.1 INTRODUCTION .............................................................................. 44

ENERGY SECTOR SCENARIOS TO 2020 ...................................................... 47 3.4.1 APPROACH AND METHODOLOGY ...................................................... 47

3.4.3 BUSINESS-AS-USUAL SCENARIO RESULTS: THE BAU CASE ............. 63 3.4.4 MITIGATION SCENARIO RESULTS .................................................. 71 3.4.5 IMPACTS OF ENERGY SECTOR SCENARIOS ........................................ 88 ENERGY SECTOR LEAST–COST GHGs ABATEMENT STRATEGY ....... 95 3.5.1 GENERAL ABATEMENT STRATEGY AND GOALS ............................ 95 3.5.2 CONCLUSIONS AND RECOMMENDATIONS ................................................... 98

INTRODUCTION AND BACKGROUND ......................................................... 103 SECTOR GREENHOUSE GAS INVENTORY ................................................ 104 4.2.1 INTRODUCTION ............................................................................... 104 4.2.2 METHODOLOGY .............................................................................. 105 4.2.3 DATA SOURCES ............................................................................ 106 4.2.4 NATIONAL GHGs INVENTORY FOR THE LAND-USE CHANGE AND

FORESTRY SECTOR ........................................................................... 107 4.2.5 BASELINE SCENARIO PROJECTION OF SECTORAL GHGs

INVENTORY TO 2020 ..................................................................... 110

4.2.7 CONCLUSIONS ............................................................................ 111

3.2.7 CONCLUSIONS ................................................................................. 43

3.3

3.3.2 OVERVIEW OF MITIGATION OPTIONS ....................................... 44 3.4

3.4.2 BUSINESS-AS-USUAL (BAU) SCENARIO ASSUMPTIONS .............. 53

3.5

PROPOSED TIME-LINE FOR IMPLEMENTATION OF STRATEGY ......... 96 3.6

4.1 4.2

4.3 SECTOR GHGs ABATEMENT OPTIONS ................................................. 112

4.3.2 MITIGATION OPTION ASSESSMENT METHODOLOGY ............ 115 4.3.3 SUMMARY OF MITIGATION OPPORTUNITIES ............................ 116

4.3.5 COMPARATIVE ASSESSMENT OF MITIGATION OPTIONS ............ 116

4.4.1 APPROACH AND METHODOLOGY ........................................... 120 4.4.2 SCENARIO ASSUMPTIONS ........................................................... 120

4.4.4 FEASIBLE SCENARIO ................................................................. 123

4.4 BASELINE AND LEAST-coST ABATEMENT SCENARIOS TO 2020 ...... 120

FEASIBLE SCENARIOS ...................................................................... 124 4.5 SECTOR LEAST-COST GHGs ABATEMENT STRATEGY ........................... 128

GENERAL SECTORAL ABATEMENT STRATEGY AND GOALS ...... 128 4.5.1 4.5.2 PROPOSED TIME-LINE FOR IMPLEMENTATION OF STRATEGY.... 128

4.6 CONCLUSIONS AND RECOMMENDATION .................................................. 130

5.1 5.2

INTRODUCTION AND BACKGROUND ......................................................... 135 SECTOR GHGs INVENTORY ..................................................................... 135 5.2.1 INTRODUCTION .............................................................................. 135 5.2.2 METHODOLOGY ............................................................................... 136

VIET NAM

4.2.6 LIMITATIONS OF THE GHGS INVENTORY DATA ...................... 111

4.3.1 INTRODUCTION ......................................................................... 112

4.3.4 ASSESSMENT OF MITIGATION OPTIONS ............................. 116

4.4.3 BASELINE AND TECHNICAL POTENTIAL SCENARIOS ......... 120

4.4.5 IMPACTS OF THE BASELINE, TECHNICAL POTENTIAL, AND

CONTENTS

5.2.3 DATA SOURCES .............................................................................. 138 5.2.4 5.2.5

5.2.6

5.2.8 MITIGATION OPTION ASSESSMENT METHODOLOGY .................. 144

5.2.10 ASSESSMENT OF MITIGATION OPTIONS ...................................... 146 BASELINE AND LEAST-COST ABATEMENT SCENARIOS TO 2020 ............ 148 5.3.1 APPROACH AND METHODOLOGY ............................................... 148 5.3.2 SCENARIO ASSUMPTIONS ............................................................... 148 5.3.3 BASELINE SCENARIO ........................................................................ 148 5.3.4 MITIGATION SCENARIO ................................................................ 149 5.3.5 IMPACTS OF THE BASELINE AND ABATEMENT SCENARIO ......... 149

5.4.1 GENERAL SECTOR ABATEMENT STRATEGY AND GOALS ................... 150 5.4.2 PROPOSED TIME-LINE FOR IMPLEMENTATION OF STRATEGY ............. 150

NATIONAL GHGs INVENTORY FOR THE AGRICULTURE SECTOR ... 139 BASELINE SCENARIO PROJECTION OF SECTORAL GHGs

LIMITATIONS OF THE GHGs INVENTORY DATA ............... 142 INVENTORY TO 2020 ............................................................... 140

5.2.7 CONCLUSIONS ............................................................................ 142

5.2.9 SUMMARY OF MITIGATION OPPORTUNITIES ...................................... 145

5.3

5.4 SECTOR LEAST-COST GHGs ABATEMENT STRATEGY ....................... 150

5.5

6.1

CONCLUSIONS AND RECOMMENDATIONS ........................................ 151

NATIONAL COST OF EMISSIONS REDUCTION INITIATIVES (CERI)

6.1.1 ENERGY SECTOR .......................................................................... 157 6.1.2 FORESTRY SECTOR ...................................................................... 161 6.1.3 AGRICULTURE SECTOR ................................................................ 162 COORDINATED NATIONAL LEAST-COST GHGs ABATEMENT

STRATEGY ................................................................................................... 164 6.2.1 6.2.2

CURVES ..................................................................................................... 157

6.2

NATIONAL ABATEMENT STRATEGY AND GOALS ........................ 164 SUMMARY OF ALGAS PROPOSED INITIATIVES ........................... 170

EXHIBIT 7.1

EXHIBIT 7.2

EXHIBIT 7.3 EXHIBIT 7.4

EXHIBIT 7.5

IMPROVEMENT OF ENERGY EFFICIENCY IN FUEL

COMBUSTION OF INDUSTRIAL PROCESSES ........................................ 177 WASTE HEAT RECOVERY AND POWER GENERATION FROM CEMENT FACTORY ........................................................................... 178 ENERGY EFFICIENCY MEASURES IN INDUSTRIAL BOILERS ........... 179 REFORESTATION FOR CONSERVATION AND EXPANSION OF

CARBON SINK IN LANG SON AND HA BAC PROVINCES .......... 181 WATER MANAGEMENT FOR REDUCING METHANE EMISSIONS

IN RICE FIELDS IN THE RED RIVER DELTA ....................................... 183

POLICY AND REGULATORY NEEDS ............................................................ 187 8.1.1 SECTORAL OBJECTIVES ................................................................... 187 8.1.2 NATIONAL OBJECTIVES ................................................................. 193 8.1.3 INTERNATIONAL OBJECTIVES ..................................................... 193

8.1

8.2 INSTITUTIONAL NEEDS ............................................................................. 194 8.2.1 ENERGY SECTOR ........................................................................... 196 8.2.2 FORESTRY SECTOR ..................................................................... 197 8.2.3 AGRICULTURE SECTOR ................................................................ 198

VIET NAM

SECTION 6 NATIONAL LEAST-COST GHGs ABATEMENT STRATEGY

SECTION 7 PORTFOLIO OF LEAST-COST

GHGs ABATEMENT PROJECTS

SECTION 8 NATIONAL GHGs ABATEMENT

ACTION PLAN

PAGE IX

CONTENTS

SECTION 9 RECOMMENDATIONS AND

FUTURE ACTIONS

TABLES

PAGE x

8.3

9.1 9.2 9.3

GHGs ABATEMENT ACTION PLAN ........................................................ 198

NATIONAL IMPLEMENTATION STRATEGY ................................................. 207 TIME-LINE FOR IMPLEMENTATION ............................................................. 212 ENGAGING THE FINANCIAL COMMUNITY ................................................... 213

TABLE 1-1

TABLE 1-2 BASELINE SCENARIO OF GHGs EMISSIONS IN MAIN

TABLE 1-3 TABLE 1-4 TABLE 1-5

MAIN RESULTS FOR NATIONAL GREENHOUSE GAS

INVENTORIES 1993 ......................................................................... 4

SECTORS ........................................................................................ 5 SCENARIO ASSUMPTIONS ............................................................... 8 TECHNOLOGY-SPECIFIC SCENARIOS FOR THE ENERGY SECTOR ......... 8 DIFFERENCES IN CO2 EMISSIONS AND COSTS BY VARIOUS

INDIVIDUAL MITIGATION SCENARIOS COMPARED TO BAU SCENARIO ...................................................................................... 9

TABLE 1-6 CO2 EMISSIONS AND TOTAL DISCOUNTED COST WITH

CO2 CONSTRAINT IN 2020 .......................................................... 9 TABLE 1-7 CO2 EMISSIONS AND TOTAL DISCOUNTED COST WITH

GRADUAL CONSTRAINT ON CO2 EMISSIONS ........................... 10 TABLE 1-8 SCENARIOS FOR FORESTRY SECTOR ............................................... 11 TABLE 1-9 SCENARIOS OF METHANE EMISSIONS FROM AGRICULTURE

TABLE 1-10 TABLE 1-11

TABLE 3-1

TABLE 3-2

TABLE 3-3 TABLE 3-4

SECTOR ......................................................................................... 11 GHGS ABATEMENT ACTION PLAN FOR VIET NAM .................. 15 SUMMARY OF PRIORITY GHGs MITIGATION PROJECTS ................. 22

GROWTH RATE OF GDP AND PRIMARY ENERGY

ANNUAL GDP GROWTH RATE FORECAST BY SECTOR, CONSUMPTION, 1992-1995 ............................................................... 35

1996-2020 .......................................................................................... 36 THE SHARE OF GDP BY SECTOR, 1996-2020 ......................... 36 FINAL ENERGY CONSUMPTION, 1985-1994 .................................. 37

VIET NAM

CONTENTS

TABLE 3-5 ENERGY CONSUMPTION BY ECONOMIC SECTOR AND

POWER GENERATION (1991-1994), KTOE ........................................ 37 GHGs EMISSIONS FROM FUEL COMBUSTION BY FUEL

TYPE AND SECTOR IN 1993, GG .................................................. 40 PROJECTION OF ENERGY SECTOR CO2 EMISSIONS, BAU

EFFICIENCIES IN THE ENERGY SECTOR, PERCENT ....................... 44 GDP GROWTH RATE FORECAST BY SECTOR. 1996-2020. PERCENT ........................................................................................ 54 SHARE OF GDP BY SECTOR. 1996-2020. PERCENT .................. 54 FORECAST OF FINAL COMMERCIAL ENERGY DEMAND IN

COMMERCIAL ENERGY CONSUMPTION IN INDUSTRIAL

COMMERCIAL ENERGY CONSUMPTION IN THE HOUSEHOLD

SECTOR, KTOE .................................................................................... 56 COMMERCIAL ENERGY CONSUMPTION IN THE COMMERCIAL

& SERVICE SECTOR, KTOE ............................................................... 56 COMMERCIAL ENERGY CONSUMPTION IN THE

TRANSPORTATION SECTOR, KTOE ...................................................... 57 COMMERCIAL ENERGY CONSUMPTION IN THE AGRICULTURE

SECTOR, KTOE .................................................................................. 58 TOTAL FINAL ENERGY DEMAND IN THE BAU CASE, KTOE ...... 63 PRIMARY ENERGY SUPPLY IN THE BAU CASE KTOE .............. 64 PERCENT SHARES OF PRIMARY ENERGY SUPPLY IN THE

BAU CASE ..................................................................................... 65 ELECTRICITY PRODUCTION IN THE BAU CASE, IN GWH .......... 66 PERCENT SHARE OF ELECTRICITY PRODUCTION IN THE

BAU CASE ..................................................................................... 66 ENERGY INPUT FOR ELECTRICITY PRODUCTION IN THE

BAU CASE, KTOE ......................................................................... 68 POWER GENERATION BY TECHNOLOGIES IN THE

BAU CASE. IN GWH ................................................................. 68 CO2 EMISSIONS IN THE BAU CASE, KT CO2- EQUIVALENT ..... 69 PERCENT SHARE OF CO2 EMISSIONS BY SECTOR

IN THE BAU CASE ........................................................................ 70 NOx EMISSIONS BY SECTOR IN THE BAU CASE, KT ............ 70 SO2 EMISSION, BY SECTORS IN THE BAU CASE, KT ............ 71 FINAL ENERGY DEMAND IN THE BASE CASE, KTOE ........... 72 PRIMARY ENERGY SUPPLY IN THE BASE CASE, KTOE .......... 73 SHARE OF ENERGY SUPPLY IN THE BASE CASE BY

TYPE OF FUEL, PERCENT ............................................................... 73 POWER GENERATION BY TECHNOLOGIES IN THE

BASE CASE. GWH ........................................................................ 74

TABLE 3-6

TABLE 3-7

TABLE 3-8 TABLE 3-9


TABLE 3-12

TABLE 3-13

TABLE 3-14

TABLE 3-15

TABLE 3-16



TABLE 3-22

TABLE 3-23


TABLE 3-26 TABLE 3-27 TABLE 3-28 TABLE 3-29 TABLE 3-30

TABLE 3-31

CASE. KTCO2-EQUIVALENT ............................................................ 42

BAU CASE, KTOE ......................................................................... 55

SECTOR, KTOE ................................................................................... 55

VIET NAM PAGE XI

CONTENTS

PAGE XII

TABLE 3-32

TABLE 3-33

TABLE 3-34

TABLE 3-35

TABLE 3-36 TABLE 3-37 TABLE 3-38 TABLE 3-39

TABLE 3-40

TABLE 3-41

TABLE 3-42

TABLE 3-43

TABLE 3-44

TABLE 3-45

TABLE 3-46

SHARE OF POWER GENERATION BY TECHNOLOGIES IN THE

BASE CASE, PERCENT .................................................................. 75 ENERGY INPUT FOR POWER GENERATION IN THE BASE CASE, KTOE .................................................................................. 76 SHARE OF ENERGY INPUT FOR POWER GENERATION IN THE

BASE CASE, PERCENT ................................................................. 76 CO2 EMISSIONS BY SECTOR IN THE BASE CASE, KT CO2-

NOx EMISSIONS BY SECTORS IN THE BASE CASE, KT NOx .... 78 SO2 EMISSIONS BY SECTOR IN THE BASE CASE, KT ............... 79 INDICATOR COMPARISON OF THE BAU AND BASE CASES ...... 81 ECONOMIC IMPLICATION OF REDUCING CARBON EMISSIONS

FROM ENERGY SECTOR .................................................................... 81 SHARES OF THE PRIMARY ENERGY SUPPLY BY SCENARIOS IN

2020, PERCENT ............................................................................... 83 SHARES OF POWER GENERATION IN 2020 BY

TECHNOLOGY - FIRST APPROACH, PERCENT .................................... 84 SHARES OF THE POWER GENERATION BY TECHNOLOGIES IN

2020 - SECOND APPROACH, PERCENT ............................................. 86 DIFFERENCES IN CUMULATIVE CO2 EMISSIONS AND COSTS

BY VARIOUS SCENARIOS COMPARED TO BAU SCENARIO .......... 90 CO2 EMISSIONS AND TOTAL DISCOUNTED COST IN THE

FIRST APPROACH ........................................................................... 91 CO2 EMISSIONS ABATEMENT AND INCREMENTAL COST IN

THE FIRST APPROACH ..................................................................... 92 CO2 EMISSIONS AND TOTAL DISCOUNTED COST IN THE

SECOND APPROACH ....................................................................... 93

THE SECOND APPROACH ................................................................ 93 SUMMARY OF NATIONAL LEAST-COST ABATEMENT STRATEGY

ENERGY INITIATIVES ................................................................... 97

AREAS OF FOREST TYPE AND FOREST USE CLASSES OF VIET

NAM IN 1989, KHA ....................................................................... 103 AREAS BY FOREST CATEGORIES IN 1993 ..................................... 104 CARBON EMISSIONS DUE TO CHANGES IN FOREST AND

OTHER WOODY BIOMASS STOCKS .................................................... 107 TOTAL CARBON EMISSIONS DUE TO FOREST AND

GRASSLAND CONVERSION ......................................................... 108 CARBON UPTAKE IN “ABANDONED MANAGED LANDS” ............. 109 TOTAL FORESTRY SECTOR CARBON DIOXIDE EMISSIONS, 1993 .............................................................................................. 109 VIET NAM FOREST AREAS, 1994 - 2020, KHA ........................ 110 POTENTIAL AREAS FOR FORESTRY MITIGATION OPTIONS .......... 113 GOALS AND MAIN BENEFITS OF FORESTRY MITIGATION

OPTIONS ........................................................................................ 114

EQUIVALENT .................................................................................. 77

TABLE 3-47 CO2 EMISSIONS ABATEMENT AND INCREMENTAL COST IN

TABLE 3-48

TABLE 4-1

TABLE 4-2 TABLE 4-3

TABLE 4-4

TABLE 4-5 TABLE 4-6


VIET NAM

CONTENTS

TABLE 4-10 MITIGATION OPTION CATEGORY AND THE SIZE OF AREA

ALLOCATED ANNUALLY FOR EACH OPTION UNDER FEASIBLE

SCENARIOS ........................................................................................ 117 COMPARATIVE ASSESSMENT OF FORESTRY MITIGATION

OPTIONS ........................................................................................ 119 TOTAL AREA, MITIGATION POTENTIAL, AND INVESTMENT

COST OF IDENTIFIED MITIGATION OPTIONS UNDER THE

DIFFERENT SCENARIOS ............................................................... 119 SCENARIO ASSUMPTIONS ................................................................... 121 MITIGATION POTENTIAL AND COST UNDER THE THREE

SCENARIOS ...................................................................................... 126 SUMMARY OF NATIONAL LEAST-COST ABATEMENT

STRATEGY INITIATIVES UNDER FEASIBLE SCENARIO ...................... 129

GROSS VALUE OF CROPS AND ANIMAL HUSBANDRY

SUBSECTORS AND DISTRIBUTION OF CROPPED AREA

(1990 - 1995), PERCENT .................................................................. 135 EMISSIONS FACTORS FOR RICE FIELDS FROM VARIOUS

REGIMES WITHOUT ORGANIC FERTILIZERS ................................ 136 TOTAL METHANE EMISSIONS FROM RICE PADDY IN VIET

NAM ............................................................................................. 137 ANIMAL POPULATION AND EMISSIONS COEFFICIENTS FOR

METHANE EMISSIONS FROM LIVESTOCK .................................. 137 SUMMARY OF THE 1993 EMISSIONS OF GREENHOUSE

GASES FROM AGRICULTURE SECTOR, GG ...................................... 140 FOOD AND FOODSTUFF CONSUMPTION PROJECTION TO 2020 (VALUES UNDER TOTAL ARE IN THOUSANDS) .................. 141 CH4, N2O EMISSIONS INVENTORY PROJECTION TO 2020, GG ................................................................................................. 141 SUMMARY OF GHGs EMISSIONS FROM AGRICULTURE

(1993) ........................................................................................... 143 POTENTIAL GHGs ABATEMENT OPTIONS FROM

AGRICULTURE SECTOR .................................................................... 144 MITIGATION OPTIONS IN RICE PRODUCTION AND

LIVESTOCK REARING ................................................................... 146 ASSESSMENT OF INVESTMENT COST AND IMPACT ON YIELD

FOR MITIGATION OPTIONS ........................................................... 147 COST-EFFECTIVENESS OF METHANE EMISSIONS REDUCTION

OPTIONS ........................................................................................ 147 SCENARIO ASSUMPTIONS ................................................................. 148 INVESTMENT COST OF REDUCING EMISSIONS FOR 2000, 2010, 2020 ..................................................................................... 150 LEAST-COST STRATEGY, MITIGATION POTENTIAL AND

INVESTMENT COST ........................................................................ 151

TABLE 4-11

TABLE 4-12


TABLE 4-15

TABLE 5-1

TABLE 5-2

TABLE 5-3

TABLE 5-4

TABLE 5-5

TABLE 5-6

TABLE 5-7

TABLE 5-8

TABLE 5-9

TABLE 5-10

TABLE 5-11

TABLE 5-12


TABLE 5-15

VIET NAM PAGE XIII

CONTENTS

PAGE XIV

TABLE 6-1 DIFFERENCES IN CO2 EMISSIONS AND COSTS OF VARIOUS

INDIVIDUAL MITIGATION SCENARIOS COMPARED TO BAU

CO2 EMISSIONS AND TOTAL DISCOUNTED COST IN FIRST

APPROACH ..................................................................................... 158

FIRST APPROACH ...................................................................... 159 CO2 EMISSIONS AND TOTAL DISCOUNTED COST IN

SECOND APPROACH ..................................................................... 160 CO2 EMISSIONS ABATEMENT AND INCREMENTAL COST IN

SECOND APPROACH ....................................................................... 160 MITIGATION OPTIONS IN AGRICULTURAL SECTOR ....................... 163 TECHNICAL, FINANCIAL, POLICY AND INSTITUTIONAL

ASPECTS FOR PROMOTION OF FORESTRY MITIGATION

OPTIONS ....................................................................................... 167 TECHNICAL, FINANCIAL, POLICY, AND INSTITUTIONAL

ASPECTS OF MITIGATION OPTIONS IN AGRICULTURAL

SECTOR ....................................................................................... 169 SUMMARY OF NATIONAL LEAST-COST ABATEMENT

AGRICULTURE ................................................................................. 170

SUMMARY OF PRIORITY GHGs MITIGATION PROJECTS ............. 175

SECTORAL POLICY OBJECTIVES AND IMPLEMENTATION

PLANS IN VIET NAM .............................................................. 187 POLICIES, ACTS OR REGULATIONS REQUIRED FOR

FORESTRY MITIGATION OPTIONS ................................................... 190 NATIONAL POLICY OBJECTIVES AND IMPLEMENTATION

PLAN OF VIET NAM ..................................................................... 194 INTERNATIONAL POLICY OBJECTIVES AND IMPLEMENTATION

PLANS OF VIET NAM ................................................................... 194 INSTITUTIONAL NEEDS FOR IMPLEMENTING ENERGY

SECTOR MITIGATION OPTIONS ................................................... 196 INSTITUTIONAL NEEDS FOR IMPLEMENTING FORESTRY

MITIGATION OPTIONS ............................................................... 197 GHGs ABATEMENT ACTION PLAN FOR VIET NAM ................. 199

IMPLEMENTATION OF ABATEMENT INITIATIVE OPTIONS ............... 212

SCENARIO ................................................................................. 157 TABLE 6-2

TABLE 6-3 CO2 EMISSIONS ABATEMENT AND INCREMENTAL COST IN

TABLE 6-4

TABLE 6-5

TABLE 6-6 TABLE 6-7

TABLE 6-8

TABLE 6-9 STRATEGY INITIATIVES IN ENERGY, FORESTRY, AND

TABLE 7-1

TABLE 8-1

TABLE 8-2

TABLE 8-3

TABLE 8-4

TABLE 8-5

TABLE 8-6

TABLE 8-7

TABLE 9-1

VIET NAM

CONTENTS

FIGURE 1-1

FIGURE 1-2 FIGURE 1-3

TOTAL GHGs EMISSIONS (CO2-EQUIVALENT) BY SECTOR IN

1993 .............................................................................................. 4 PROJECTION OF NATIONAL GHGs EMISSIONS TO 2020 ....... 6 CERI CURVE FOR ENERGY SECTOR TECHNOLOGY

MITIGATION OPTIONS ................................................................. 12

ENERGY SECTOR FIRST APPROACH .................................................. 13 CO2 EMISSIONS ABATEMENT AND INCREMENTAL COSTS IN

ENERGY SECTOR; GRADUAL CONSTRAINT APPROACH ................... 13 FORESTRY SECTOR CERI CURVE UNDER BASELINE

SCENARIO .................................................................................... 14 FORESTRY SECTOR CERI CURVE UNDER FEASIBLE

SCENARIO ....................................................................................... 14 FORESTRY SECTOR CERI CURVE UNDER TECHNICAL

POTENTIAL SCENARIO ..................................................................... 14 AGRICULTURE SECTOR CERI CURVE ................................................ 15

GHGs EMISSIONS FROM ENERGY SECTOR, FUEL

COMBUSTION AND FUGITIVE EMISSIONS, EXPRESSED AS

CO2-EQUIVALENT ...................................................................... 42 CO2 EMISSIONS BY FUEL TYPE IN BAU CASE ..................... 42 COMMERCIAL ENERGY CONSUMPTION IN THE INDUSTRY

SECTOR, 1994-2020 ........................................................................ 55 COMMERCIAL ENERGY CONSUMPTION IN THE HOUSEHOLD

SECTOR, 1994-2020 ......................................................................... 56 COMMERCIAL ENERGY CONSUMPTION IN THE COMMERCIAL

& SERVICE SECTOR, 1994-2020 ..................................................... 57 COMMERCIAL ENERGY CONSUMPTION IN THE TRANSPORT

SECTOR, 1994-2020 ........................................................................... 57 COMMERCIAL ENERGY CONSUMPTION IN THE AGRICULTURE

SECTOR, 1994-2020 ........................................................................ 58 FINAL ENERGY DEMAND IN THE BAU CASE ........................ 64 PRIMARY ENERGY SUPPLY IN THE BAU CASE ............................... 65 ELECTRICITY PRODUCTION IN THE BAU CASE ........................ 67 ENERGY INPUT FOR ELECTRICITY PRODUCTION IN THE

BAU CASE ................................................................................... 68 POWER GENERATION BY TECHNOLOGIES IN THE BAU CASE .......................................................................................... 69 CO2 EMISSIONS IN THE BAU CASE ............................................ 70 NOx EMISSIONS IN THE BAU CASE ......................................... 71 SO2 EMISSIONS IN THE BAU CASE .......................................... 71 FINAL ENERGY DEMAND IN THE BASE CASE ................................. 72 PRIMARY ENERGY SUPPLY IN THE BASE CASE ....................... 73 POWER GENERATION BY TECHNOLOGIES IN THE

BASE CASE ................................................................................... 75

FIGURE 1-4 CO2 EMISSIONS ABATEMENT AND INCREMENTAL COSTS IN

FIGURE 1-5

FIGURE 1-6

FIGURE 1-7

FIGURE 1-8

FIGURE 1-9

FIGURE 3-1

FIGURE 3-2 FIGURE 3-3

FIGURE 3-4

FIGURE 3-5

FIGURE 3-6

FIGURE 3-7

FIGURE 3-8 FIGURE 3-9 FIGURE 3-10 FIGURE 3-11

FIGURE 3-12

FIGURE 3-13 FIGURE 3-14 FIGURE 3-15 FIGURE 3-16 FIGURE 3-17 FIGURE 3-18

VIET NAM

LIST OF FIGURES

PAGE xv

CONTENTS

PAGE XVI

FIGURE 3-19

FIGURE 3-20 FIGURE 3-21 FIGURE 3-22 FIGURE 3-23

FIGURE 3-24

FIGURE 3-25

FIGURE 3-26

ENERGY INPUT FOR POWER GENERATION BY FUEL TYPE IN

BASE CASE .................................................................................... 77 CO2 EMISSIONS BY SECTORS IN BASE CASE ................................. 78 NO2 EMISSION BY SECTORS IN BASE CASE ................................ 78 SO2 EMISSIONS BY SECTOR IN THE BASE CASE .................... 79 COMPARISON OF PRIMARY ENERGY SUPPLY IN THE BAU AND BASE CASES .......................................................................... 79 COMPARISON OF ELECTRICITY GENERATION BY

TECHNOLOGY IN THE BAU AND BASE CASES ........................ 80 COMPARISON OF CO2 EMISSIONS IN THE BAU AND

BASE CASES .................................................................................. 80 COMPARISON OF PRIMARY ENERGY SUPPLY IN 2010 AND

2020 ............................................................................................... 83

TECHNOLOGY - FIRST APPROACH ..................................................... 84 ELECTRICITY PRODUCTION BY TYPE OF TECHNOLOGY IN

2010-FIRST APPROACH ................................................................... 84 ELECTRICITY PRODUCTION BY TYPE OF TECHNOLOGY IN

2020-FIRST APPROACH .................................................................. 85 PRIMARY ENERGY SUPPLY IN 2010 AND 2020 - SECOND

APPROACH ..................................................................................... 86 ELECTRICITY PRODUCTION BY TYPE OF TECHNOLOGY – SECOND APPROACH IN 2000 ............................................................. 87 ELECTRICITY PRODUCITON BY TYPE OF TECHNOLOGY–SECOND APPROACH IN 2010 .......................................................... 87 ELECTRICITY PRODUCTION BY TYPE OF TECHNOLOGY –SECOND APPROACH IN 2020 ............................................................ 87 CERI CURVE FOR INDIVIDUAL OPTIONS ........................................ 90 CO2 EMISSIONS IN THE FIRST APPROACH .................................... 92 CO2 EMISSIONS ABATEMENT AND INCREMENTAL COST

RELATION IN THE FIRST APPROACH .............................................. 92

CO2 EMISSIONS ABATEMENT AND INCREMENTAL COST

RELATION IN THE SECOND APPROACH ............................................ 94

FIGURE 3-27 ELECTRICITY PRODUCTION IN 2000 BY TYPE OF

FIGURE 3-28

FIGURE 3-29

FIGURE 3-30

FIGURE 3-31

FIGURE 3-32

FIGURE 3-33

FIGURE 3-34 FIGURE 3-35 FIGURE 3-36

FIGURE 3-37 CO2 EMISSIONS IN THE SECOND APPROACH ................................ 93 FIGURE 3-38

FIGURE 4-1

FIGURE 4-2

FIGURE 4-3

TOTAL GHGs EMISSIONS (CO2- EQUIVALENT) BY SECTOR

IN 1993 ........................................................................................... 110 PROJECTIONS OF GHGs EMISSIONS IN LAND-USE CHANGE

AND FORESTRY SECTOR ................................................................... 111 MITIGATION POTENTIALS OF FORESTRY OPTIONS UNDER

THE FEASIBLE SCENARIO .................................................................. 118

UNDER THE FEASIBLE SCENARIO ....................................................... 118

ABATED UNDER BASELINE SCENARIO .................................................... 125

FIGURE 4-4 LIFE-CYCLE COST OF FORESTRY MITIGATION OPTIONS

FIGURE 4-5A COST OF CARBON ABATEMENT AND CUMULATIVE CARBON

VIET NAM

CONTENTS

FIGURE 4-5B COST OF CARBON ABATEMENT AND CUMULATIVE CARBON

ABATED UNDER TECHNICAL POTENTIAL SCENARIO .................... 125 COST OF CARBON ABATEMENT AND CUMULATIVE CARBON

ABATED UNDER FEASIBLE SCENARIO .............................................. 125 CUMULATIVE MITIGATION POTENTIAL OF THE FEASIBLE

SCENARIO ........................................................................................ 127 CUMULATIVE C ABATED AND NPV OF BENEFITS UNDER

THE FEASIBLE SCENARIO ............................................................ 127 CUMULATIVE C ABATED AND LIFE-CYCLE COSTS

REQUIRED FOR THE FEASIBLE SCENARIO ....................................... 128

EMISSIONS OF AGRICULTURAL SECTOR. CO2- EQUIVALENT ......... 139

FIGURE 4-5c

FIGURE 4-6

FIGURE 4-7

FIGURE 4-8

FIGURE 5-1 FIGURE 5-2 PROJECTED TOTAL CH4 EMISSIONS FROM AGRICULTURE

SECTOR TO 2020 ........................................................................... 142

FIGURE 6-1 CERI CURVE BY INDIVIDUAL OPTIONS ....................................... 158 FIGURE 6-2 FIGURE 6-3 CO2 EMISSIONS ABATEMENT AND INCREMENTAL COST

RELATION IN FIRST APPROACH .................................................. 159 FIGURE 6-4 CO2 EMISSIONS IN SECOND APPROACH ....................................... 160 FIGURE 6-5 CO2 EMISSIONS ABATEMENT AND INCREMENTAL COST

RELATION IN SECOND APPROACH ........................................ 161 FIGURE 6-6 FORESTRY SECTOR CERI CURVE UNDER BASELINE

SCENARIO ........................................................................................ 161 FIGURE 6-7 FORESTRY SECTOR CERI CURVE UNDER FEASIBLE

SCENARIO ........................................................................................ 162 FIGURE 6-8 AGRICULTURE SECTOR CERI CURVE ............................................ 163

FIGURE 8-1

CO2 EMISSIONS IN FIRST APPROACH ........................................ 159

SCHEME OF INSTITUTIONAL ARRANGEMENT ON CLIMATE

CHANGE ....................................................................................... 196

VIET NAM PAGE XVII

ABBREVIATIONS

ABBREVIATIONS

PAGE XVIII

ADB .............................. Asian Development Bank AGRICULT-SS ............. Agricultural System

ALGAS .......................... Asia Least-cost Greenhouse Gas Abatement Strategy

BAU .............................. Business-as-Usual BCF ................................ Billion Cubic Feet

AIJ ................................. Activities Implemented Jointly

C ................................... Carbon CENELEC-SS ................ Central Electricity System CERI ............................... Cost of Emission Reduction Initiatives CFC ................................ Chlorofluorocarbon

CO ................................... Carbon Monoxide

COMAP .......................... Comprehensive Mitigation Analysis Process CNG ............................... Compressed Natural Gas DSM ............................... Demand Side Management EC ................................... Electric Cooperative EERs .............................. Energy Efficiency Ratios EFDB ............................. Energy Environment Data Base

ENR ............................... Enhanced Natural Regeneration EFOM ............................ Energy Flow Optimization Model

EU ................................. European Union EVN ............................... Electricity of Viet Nam FAO ............................... Food and Agriculture Organization FIPI ................................ Forest Inventory and Planning Institute

FP .................................. Forest Protection

GAS-SS .......................... Gas system

FORPROT ..................... Forest Protect

FSI ................................ Forest Science Institute

GDP ................................ Gross Domestic Product GEF ............................... Global Environment Facility GHGS ............................. Greenhouse Gases GWP .............................. Global Warning Potential GSO ............................... General Statistical Office H .................................. Hydrogen HH-SS ............................ Household System HMS ............................... Hydrometeorological Service ILB ................................ Incandescent Light Bulb IMH ............................... Institute of Meteorology and Hydrology INDUS -SS .................... Industrial System IPCC .............................. Intergovernmental Panel on Climate Change ITE ................................. International Technical Expert LANDSAT ..................... US Satellite LNG ................................ Liquefied Natural Gas LPG ................................ Liquefied Petroleum Gas

MARKAL ...................... Market Allocation Model MOARD ........................ Ministry of Agriculture and Rural Development

LRR ................................ Long Rotation Reforestation

VIET NAM

CFL ................................ Compact Flourescent Lamp CH 4 ................................ Methane

CO 2 ................................ Carbon Dioxide COAL-SS ........................ Coal System

ABBREVIATIONS

MEDEE-S ...................... Model for Energy Demand Evaluation MOF .............................. Ministry of Forestry

MPI ................................ Ministry of Planning and Investment MW ............................... Megawatt

MOI ............................... Ministry of Industry

NEP ................................ National Energy Plan NEDP ............................ National Energy Development Program

NPV ................................ Net Present Value

NIAPP ........................... National Institute for Agricultural Planning and

NMVOCs ....................... Non-Methane Volatile Organic Component N 2 O ................................. Nitrous Oxide NOx ............................... Nitrogen Oxides NTE ................................ National Technical Expert

OIL- ss ........................... Oil system PJ ................................... Peta joules PV .................................. Photovoltaic SRV ............................... Socialist Republic of Viet Nam

NEEP ............................. National Energy Environment Plan

NGO ............................. Non-Governmental Organization

Projection

OECD ............................ Organization for Economic Cooperation and Development

ST ................................. Scattered Trees TF-SS ............................ Traditional Natural System

UK ................................. United Kingdom UNCED ......................... United Nations Conference on Environment and

Development UNDP ............................ United Nations Development Programme UNEP ............................ United Nations Environment Programme UNFCCC ....................... United Nations Framework Convention on

Climate Change UNITAR ........................ United Nations Institute for Training and

Research VNCCCT ........................ Viet Nam Climate Change Country Team VND ............................... Viet Nam Dong (Viet Nam Currency) WB ................................. World Bank WWF ............................. World Wide Fund for Nature

UNITS

g/km .............................. gram per kilometer

kgoe ............................... kilogram oil equivalent

VIET NAM PAGE XIX

S .................................... Sulfur SRR ............................... Short Rotation Reforestation

TRANSPOR-SS ............ Transport System

Gg ................................. Giga grams GWh ............................. Gigawatt hour ha .................................. hectare

O .................................... Oxygen

ABBREVIATIONS

PAGE XX

kgC ................................ kilogram Carbon kha ................................. kilo hectares (1000 ha) km ................................. kilometer km2 .............................. square kilometer km3 ................................. cubic kilometer kt CO 2 .......................... kilotonnes CO2

kt C .............................. kilotonnes Carbon

mt ................................. million tonne

tC/ha ............................. tonne of Carbon per hectare tdm ................................. tonne dry matter

toe/year ......................... tonne oil equivalent per year TgC ................................ Teragram of Carbon

TWh ............................... Terawatt hour W ................................... Watt

VIET NAM

kt ................................... kilotonnes

kt dm ......................... kilotonnes dry matter ktoe ................................ kilotonnesoil equivalent kV ................................... Kilo Volt kWh .............................. kilowatt hour mha .............................. million hectare

mtC ................................ million tonne of Carbon

iet Nam is located in Southeast Asia, sharing land borders with People’s Republic of China, Laos, and Cambodia. It has a land V area of 330,990 km2, and stretches 1,650 km from north to south,

600 km at its widest and 50 km at its narrowest. It consists of more than 1 million km2 of water surface, with 3,260 km of coastline, and thousands of small islands, especially in the Tonkin Gulf. Viet Nam is the 12th most populous country in the world, with an estimated population of 72.5 million in 1994 and a population growth rate of 2.5 percent. About 20 percent of the population live in the urban areas, while 80 percent live in rural areas.

Viet Nam can be divided into three geographical regions: the South, the Central, and the North. The Mekong Delta in the south and the Red River Delta in the north are separated by a thin central strip. This clear distinction in geographical regions is also reflected in economic development. There are about 2,860 rivers in Viet Nam. The Red River and the Mekong River are the largest and most important ones. Viet Nam is located in the inter-tropical zone, but because of its long north-south span, climate conditions vary from sub- zero temperatures in the northern mountains to the year-round heat of the Mekong Delta.

Viet Nam ratified the United Nations Framework Convention on Climate Change (UNFCCC) on 16 November 1994. The Hydrometeorological Service (HMS) has been assigned by the Government to take full responsibility for climate change issues and for implementing programs related to the objectives of the UNFCCC.

A Viet Nam Climate Change Country Team (VNCCCT) was established in 1994 with a mandate to improve knowledge on climate change and its social, economic and environmental impacts. The Director General of HMS chairs the VNCCCT. It is represented by all relevant ministries and government agencies including representatives from Ministry of Planning and Investment, Ministry of Science, Technology and Environment, Ministry of Industry, Ministry of Transportation, Ministry of Agriculture and Rural Development, Ministry of Training and Education, Ministry of Foreign Affairs, Viet Nam Union of Scientific and Technical Associations, and Hydrometeorological Service. The VNCCCT has remained as the main policy advisory body in the area of climate change. It played a key role in the implementation of the ALGAS Project, and it is charged with overseeing and advising on the implementation of the Project.

Other studies in Viet Nam related to climate change are described below.

Regional Studies on Global Environment Issues: The study was sponsored by ADB for eight Asian countries, including Viet Nam. It studied the socioeconomic impacts of climate change and policy options to cope with climate change. Vulnerability Assessment in Viet Nam, funded by the Netherlands. Started in 1994, its objective was to undertake the vulnerability and impacts assessment on the coastal zone. Socioeconomic and Physical Approaches to Analyzing Climate Change Impacts in Viet Nam. Funded by the United Kingdom, this research project started in 1996. It is a study of socioeconomic vulnerability to climate change impacts in the coastal zone of the Red River Delta of Viet Nam. UNEP/GEF project on Economics of GHG Limitation - Phase 1: Establishment of a Methodological Framework for Climate Change

VIET NAM

1 .1 COUNTRY PROFILE AND

STATUS OF CLIMATE

CHANGE ACTIVITIES

PAGE 3

SECTION 1

1.2 1993 NATIONAL

INVENTORY OF GHGs SOURCES AND SINKS

FIGURE 1-1 TOTAL GHGs EMISSIONS

(CO2-EQUIVALENT) BY SECTOR

IN 1993

TABLE 1-1 MAIN RESULTS FOR NATIONAL

GREENHOUSE GAS INVENTORIES

1993

PAGE 4

EXECUTIVE SUMMARY

Mitigation Assessment: This study deals with GHGs mitigation analysis and cost-effective options. UNDP/UNITAR/GEF CC: TRAIN (Phase 1): Its objective was to assist the countries in formulating climate change policy for the implementation of the UNFCCC.

The total net emissions of greenhouse gases (GHGs) in Viet Nam, using 1993 as the base year, were: 64,062 Gg CO2, 2,588 Gg CH4, 14.63 Gg N2O, 182.09 Gg NOx and 3,127.56 Gg CO. Using a global warming potential (GWP) of 1 for CO2, 21 for CH4, and 310 for N2O, the contribution of these three gases in terms of CO2-equivalent or GWP is equivalent to a total CO2 emissions of 111.7 million tonnes (mt), which is contributed by:

Carbon dioxide, 64 mt,

The three sectors that emitted the largest quantities of GHGs are

Methane, 54.4 mt of CO2-equivalent, and Nitrous oxide, 4.5 mt of CO2-equivalent.

agriculture, forestry, and energy. The agriculture sector contributed 48 mt of CO2-equivalent while the forestry sector emitted 31 mt CO2-equivalent, and the energy sector emitted 27.5 mt of CO2-equivalent (Table 1-1). Total GHGs emissions in CO2 equivalent by sector in 1993 are presented in Figure 1-1.

A. Fuel Combustion 19,833.47 164.26 11.01 143.01 1,637.36 26,696.03

0.77 7.54 27.77 13.79 5,939.33 1 Energy & Transformation Industries 3,585.76

2 Industry and other 6,931.54 6,931.54

3 Transport 2,663.90 0.92 0.16 66.99 199.55 2,732.82

4 Small Combustion 3,818.00 0.12 1.46 5.30 2.20 4,273.12

5 Others 2,834.27 0.07 0.73 2.60 1.00 3,062.04

VIET NAM

Greenhouse Gas Source and Sink Categories

CO2 Emissions

CO2 Removal

CH4 N2O NOX CO

Amount CO2-

(CO2+CH 4 +N2O)

Total National Emissions and Removal

1. All Energy (Fuel Combustion + Fugitive)

109,997.00 -57.191.60 2,588.30 14.63 182.09 3,127.56 111,695.00

19,833.47 202.35 11.01 143.01 1,637.36 27,495.92

equivalent


6 Traditional Biomass Burned Energy (37,211.86) 162.38 1.12 40.35 1,420.82 3,757.18

B. Fugitive Emissions from Fuels 38.09 799.89

1. Solid 38.09

A. Enteric Fermentation 328.68 6,902.98

B. Manure Management 123.50 2,593.50

C. Rice Cultivation 1,754.70 36,848.70

D. Prescribed Burning of Savannas 23.96 0.30 10.71 628.91 596.16

16.49 0.36 13.77 346.39 464.09

F. Agricultural Soils 2.54 787.40

E. Field Burning of AgriculturalResidues

-56,146.60 -56,146.60 A. Change in Forest and Other

Woody Biomass Stocks

87,076.70 58.90 0.40 14.60 514.90 88,437.60

C. Abandonment of Managed Lands -1,045.00 -1,045.00

B. Forest and Grassland Conversion

A. Solid Waste Disposal on Land 47.87 1,005.97

B. Waste water 3.51 73.71

C. Industrial Wastewater 28.34 595.14

1993 2000 2010 2020

Energy 22.31 45.92 105.17 196.98

Forestry 31.25 4.20 21.70 28.40

Agriculture 48.19 52.50 57.20 64.70

Total 101.75 233.28

VIET NAM

1.3 BASELINE PROJECTION OF

NATIONAL GHGs INVENTORY TO 2020

TABLE 1-2 BASELINE SCENARIO OF GHGs EMISSIONS IN MAIN SECTORS

PAGE 5

Greenhouse Gas Source and Sink Categories

CO2 Emissions

CO2 Removal CH4 N2O NOx CO

Amount CO2- equivalent (CO2+CH4

+N2O)

2. Industrial processes 3,086.83 3,086.83 3. Solvent and other product Use

4. Agriculture 2,247.33 3.22 24.48 975.30 48,192.13

5. Land-use Chang e & Forestry 87,076.70 -57,191.60 58.90 0.40 14.60 514.90 31,246.00

6. Waste 79.72 1,674.12

Sector GHGs Emissions, Tg CO2-equivalent

140.67 102.62

GHGs emissions from the energy sector in 2020, based on projection of the energy demand and the primary energy supply, were projected to be morethan 8 times as high as in 1993. The total GHG emissions from the energysector are projected to increase from 22.31 mt in1993 to 196.98 mt at the endof the study period. (Table 1-2 and Figure 1-2) This corresponds to an averagegrowth rate of 6.7 percent per year.

- -


FIGURE 1-2 PROJECTION OF NATIONAL

GHGs EMISSIONS TO 2020

1.4 GHGs MITIGATION

OPTIONS

1.4.1 ENERGY SECTOR

PAGE6

In the forestry sector, the highest CO2-equivalent emissions were produced in 1993, but forestry sector emissions have been decreasing since then, and shortly after 2000 the sector is projected to become a net sink for CO2 (see Figure 1.2).

The agriculture sector’s emissions are gradually increasing, with the annual growth rate of 0.1 to 0.2 percent.

The growth rate of GHGs emissions from the energy sector is faster than those of the agriculture and forestry sectors. The total GHGs emissions from the three sectors shows a steeply increasing trend starting in year 2000.The net annual growth rate from 2000 to 2020 is 6.5 percent.

A list of GHGs mitigation options was developed for each sector, and based on the list, a wide range of policy and technology options were identified that could be considered to reduce GHGs emissions or enhance sinks.

Potential mitigation options that could provide GHGs abatement in the energy sector are as follows.

Demand-side energy efficiency measures:

(i) Improve energy efficiency in fuel combustion processes used in industry.

(ii) Highly efficient cooking stoves in rural areas. (iii) Energy-efficient industrial boilers to replace low-efficiency models. (iv) Switching from coal to natural gas for cooking in urban areas. (v) Energy efficient compact lamp for lighting. (vi) Highly efficient electric motors to replace standard electric motors. (vii) Highly efficient household electric equipment. (viii) Increased vehicle fuel efficiency. (ix) Waste heat recovery power generation.

Supply-side measures:

(x)

(xi)

Fuel switching to renewable and less-carbon-intensive energy sources. Improvement in efficiency of fossil fueled power plants.

VIET NAM

SECTION I

The forest mitigation options aim at carrying out reforestation and forest protection at a national level. In addition, scattered tree planting activities by local households provide a number of economic benefits as well as reducing deforestation.

GHGs mitigation options in the forestry sector are as follows:

(i) Reforestation of degraded forest areas under long and short rotation period.

(ii) Natural regeneration. (iii) Forest protection. (iv) Scattered tree planting.

Viet Nam is an agricultural country, with 75 to 80 percent of its population living in the countryside engaged in the agricultural production of over 7.3 million hectares (mha) of agricultural land.

The most significant agricultural sources of methane emissions are rice cultivation and livestock. Agriculture sector mitigation options should meet the following general guidelines:

Increase agricultural production levels.

Potential GHGs abatement options for the agriculture sector is:

(i) Water management in irrigated rice paddy fields. (ii) Change in cropping patterns from the two rice crop to three crop

system (rice - upland crop - rice). (iii) Sowing directly to rice paddy fields. (iv) Using bio-fertilizers (composite) on the field crop. (v) Rational feeding of livestock. (vi) Using biogas in rural areas.

The macroeconomic scenario for all sectors is based on the gross domestic product (GDP) growth rate and GDP structure that was projected by the Development Strategic Institute (Table 1-3). Projected baseline GHGs emissions for each sector is given in Table 1-2. It should be noted that these projections were made prior to the recent turndown of the Asian economies in the region.

Not require significant amounts of hard currency. Result in products that will be accepted by local consumers.

The Energy Flow Optimization Module - Environment (EFOM-ENV) was used to develop and analyze baseline and mitigation scenarios. Descriptions of the technology-specific scenarios in the energy sector are given in Table 1-4.

costs compared with the business-as-usual (BAU) scenario (Table 1-5). The results show that all energy demand-side abatement options are “win-win” (negative cost) options. On the supply side, wind power construction is a cost- effective option. However, fuel switching for coal and oil thermal-fired power plants is more expensive than the baseline.

The individual mitigation options were evaluated for GHGs emissions and

VIET NAM

EXECUTIVE SUMMARY

1.4.2 FORESTRY SECTOR

1.4.3 AGRICULTURE SECTOR

1.5 BASELINE AND ABATEMENT

SCENARIOS TO 2020

1.5.1 ENERGY SECTOR

PAGE 7

SECTION 1

TABLE 1-3 SCENARIO ASSUMPTIONS

TABLE 1-4 TECHNOLOGY-SPECIFIC

SCENARIOS FOR THE ENERGY

SECTOR

PAGE 8

EXECUTIVE SUMMARY

Population, million persons 72.5 81.25 95 105

30.0 35.5 41.5 44.0 Industrial & construction GDP, percent

Service GDP, percent 41.7 42.0 43.0 43.9

Agricultural GDP, percent 28.4 22.4 15.5 12.1

Urban population as percentage of 19.9 30 40 55 total population

Energy Intensity per GDP, kgoe/$ 0.7 0.66 0.62 0.54

CO2 Emissions Intensity per Capita, 0.29 0.57 1.12 1.85 kgC per capita

Base case Based on economic scenario developed by Development Strategic Institute with GDP growth rate of 8.5 percent (1996-2000), 7.8 percent (2001 -2010), 7 percent (2011- 2020).

Wind power Construction of wind power plants: 10 MW in 2000, 20 MW in 2005,40 MW in 2010, and 100 MW in 2020.

Substitution of coal by oil and oil by gas in generation, Fuel switching in power generation 1998-2005:

Conversion of existing 640MW of coal-fired thermal power plants in the North to use oil,

Conversion of existing 198 MW thermal power plant in the South to use gas.

Improvement of efficiency in cooking percent.

Highly efficient lighting

Fuel efficiency in cooking is improved from 17 to 25

Substitution of incandescent bulb by highly efficient compact fluorescent lamp (CFL); market penetration in year 2000: 30 percent; 2005: 40 percent; 2010: 50 percent; 2020: 60 percent.

Replace existing refrigerators by new efficient ones with 15-16 percent energy saving, starting 1998.

High efficiency refrigerator

VIET NAM

Assumption Base Year

(1994) 2000 2010 2020

GDP, 109$, price 1994 15.517 26.049 55.209 108.60

GDP per capita, $/person, price 1994 214 322 587 1,025

Gross Energy Consumption, ktoe 10,875.3 17,251.1 34,217.5 58,841.6

CO2 Emission Intensity per GDP, kgC/$

1.43 1.96 2.66 3.02

Discount rate (%) 10 10 10 10

Scenario Description

Supply-side Abatement Scenario

Demand-side Abatement Scenario

SECTION 1

Cost, $ million 34,354 34,051 34,221 33,603 33,806 33,851 34,586 34,196

∆Costs, $ million -303 -133 -751 -548 -503 232 -158

Source: Results from optimization, 1998. ENV-1: Efficiency improvement in coal cooking ENV-2: Compact fluorescent lamps ENV-3: Energy efficient refrigerators ENV-4: Energy efficient air conditioners

ENV-5: Highly efficient electric motors ENV-6: Fuel switching in existing

thermal power plants ENV-7: Wind power plant

Two approaches to placing constraints on GHGs emissions were evaluated using the EFOM-ENV model. The ABAT01, ABAT02, and ABAT03 cases set constraints on, CO2 emissions in year 2020 to be reduced by 5 percent, 10 percent, and 15 percent, respectively, compared to the BASE case, which is the least cost solution. The discounted cost of the ABAT01 case is higher than that of the BASE case but lower than BAU case (Table 1-6).

BAU BASE

BASE 22.00 42.15 72.39 97.77 188.65 4.23 0.00 33,447

ABAT02 22.00 43.20 74.36 101.08 169.78 13.80 10.00 34,129

The ABAT04, ABAT05, and ABAT06 cases set constraints on CO2 emissions in the period 2005-2020 to be abated by 0.5 percent, 1 percent, and 1.1 percent, respectively, compared to the BASE case. The total CO2 emissions in the whole study period is reduced by 13 percent, 17.5 percent, or 18.7

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EXECUTIVE SUMMARY

TABLE 1-5 DIFFERENCES IN CO2 EMISSIONS

AND COSTS BY VARIOUS

INDIVIDUAL MITIGATION

SCENARIOS COMPARED TO BAU SCENARIO

TABLE 1-6 CO2 EMISSIONS AND TOTAL

DISCOUNTED COST WITH CO2 CONSTRAINT IN 2020

PAGE 9

BAU 22.00 45.92 77.10 105.17 196.88 34,354

ABT01 22.00 43.20 74.36 101.08 179.22 9.02 5.00 34,101

ABAT03 22.00 43.20 74.36 101.08 160.35 18.59 15.00 34,384

Scenario 1994 2000 2005 2010 2020

Percent CO2 abatement in

2020 compared to

Discounted cost,

$million

∆CO2, emissions, mt 73 16 88 52 70 5 34

Cost per tCO2, reduction -4.15 -8.31 -8.53 -10.54 -7.19 46.4 -4.64

CO2 emissions, mt 2,477 2,404 2,461 2,389 2,425 2,407 2,472 2,443

BAU ENV1 ENV2 ENV3 ENV4 ENV5 ENV6 ENV7

Electric motors Introduction of the motor efficiency standard; efficiency improves 5 percent, based on 86 percent standard efficiency.

High efficiency air conditioning

Replacing old by new efficient ones. Average electricity consumption is expected to decrease 22 percent.

Scenario Description

SECTION 1

TABLE 1-7 CO2, EMISSIONS AND TOTAL

DISCOUNTED COST WITH

GRADUAL CONSTRAINT ON CO2 EMISSIONS



EXECUTIVE SUMMARY

percent, compared to the BAU case, by implementing ABAT04, ABAT05, or ABAT06, respectively. The discounted cost of ABAT04 and ABAT05 cases is higher than that of the BASE case but lower than BAU case (Table 1-7).

BASE 22.00 42.15 72.39 97.77 188.65 4.23 0.00 33,447

ABAT02 22.00 43.20 71.67 93.02 162.49 17.51 13.87 34,129

Based on the Master Plan of Ministry of Agriculture and Rural Development (MARD), GHGs emissions and carbon sequestration in the forestry sector has been projected to the years 2000, 2010 and 2020.

In past years, the rate of reforestation has increased from year to year. Every year, more than 100,000 hectares (ha) of forest are planted. However, the natural forests are shrinking in area due to shifting cultivation and clearing for permanent agriculture. They are also being degraded through unsuitable exploitation for logs and fuelwood. Deforestation continues as a serious problem of the country. It is estimated that the rate of annual forest loss is about 150,000 ha. This problem needs to be solved in the coming years.

For the ALGAS Study, three scenarios were developed: Baseline, Technical Potential, and Feasible scenarios. All forestry options under the three scenarios were developed and analyzed with the Comprehensive Mitigation Analysis Process (COMAP) model. The Baseline scenario is considered a likely-trends scenario. The Technical Potential scenario is based on the Government’s policy relating to reforestation, afforestation, and natural forest protection. The Feasible scenario assumes that levels of implementation of forestry options are higher than in the Baseline scenario but lower than in the Technical Potential scenario. This scenario is considered to be more feasible than the Technical Potential scenario because of existing socioeconomic and technological conditions in the country. Five forestry mitigation options are suggested for this scenario, in which the rate of reforestation would be about 140,000 ha per year, while 4 billion scattered trees would be planted during the period 1994-2020. In addition. 6.5 mha of existing natural forests would be protected, and 1.9 mha of degraded forest areas would be managed under enhanced natural regeneration in the whole period.

Feasible scenario. Forest protection has by far the largest abatement potential. Table 1-8 describes the Baseline Scenario and the forestry options under the

The Baseline scenario for the agriculture sector assumes that the rice cultivation area grows from 6.5 mha in 1993 to 7.3 mha in 2010 and 7.7 mha in 2020. The population of animals increases from 6.2 million head of

PAGE 10 VIET NAM

ABAT03 22.00 43.20 70.89 92.56 160.10 18.72 15.13 34,384

ABAT01 22.00 43.20 72.03 95.36 175.05 11.13 7.21 34,101

BAU 22.00 45.92 77.10 105.17 196.98 34,354

Scenario 1994 2000 2005 2010 2020 Discounted

cost, $million


2020 compared to

BAU BASE


50,000 ha deforestation annually. 100,000 ha 47 forest rehabilitation annually. Conservation of 2.4 mha of existing protection forest. Enhanced natural regeneration of 1.1 mha of degraded forest. Planting 3 billion scattered trees over the period of 1994-2020

Natural forest protection

Protection of 6.5 mha of existing forest up to 2020. Deforestation to be controlled by conducting intensive forest protection.

Enhanced natural Enhanced natural regeneration of 1.85 mha of 87 regeneration

680

degraded forest areas in combination with reforestation at a rate of 68,500 ha/year.

Planting scattered Planting 4 billion scattered trees in urban 80 trees areas, villages, bare lands, etc., which equates

to 1.65 mha to be revegetated up to 2010.

Long rotation Reforestation of 1 mha of degraded forest 68 reforestation lands under long rotation (27 years) at a rate

of 40,000 ha/year.

forest lands into forest plantation with10-year rotation.

Short rotation Conversion of 90,000 ha/year of degraded 72 reforestation

buffaloes and cattle in 1993 to 9.5 million head in 2010 and 11.9 million head in 2020.

The abatement options in this sector are:

Water management with intermittent draining of rice fields during the growing season. Water management can reduce methane emissions by 20–50 percent, while at the same time increasing yield by 6–8 percent. Improving the nutrition of livestock through mechanical and chemical feed processing.

GHGs emissions and investment costs of reducing methane emissions from agriculture sector activities are given in Table 1-9. The methane emissions avoided under mitigation options A1 and A2 are 93x103 tonne in 2000, 194x103 tonne in 2010, and 295x103 tonne in 2020.

CH4 emissions from Rice 1,755 1,894 1,998 2,111

CH4 emissions from Livestock 452 560 692 927

Sub total 2,207 2,454 2,690 3,038

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TABLE 1-9 SCENARIOS OF METHANE

EMISSIONS FROM AGRICULTURE

SECTOR

PAGE 11

Feasible Scenario

Baseline Scenario

Option Description Total Carbon Abated, Tg

Baseline Scenario, Gg

Scenario Base year 2000 2010 2020

TABLE 1-8 SCENARIOS FOR FORESTRY SECTOR


1,755 1,804 1,818 1,838 CH4 emissions from Rice field under water management

452 557 678 905 CH4 emissions from Livestock through nutrition improvement

Sub total 2,207 2,361 2,496 2,743

Water Management 0 1.87 3.75 5.62

Livestock 0 0.03 0.06 0.09

Sub total 0 1.90 3.81 5.71

1.6 NATIONAL LEAST-COST

GHGs ABATEMENT

CURVES

1.6.1 ENERGY SECTOR

FIGURE 1-3 CERI CURVE FOR ENERGY

SECTOR TECHNOLOGY

MITIGATION OPTIONS

PAGE 12

Cost of Emissions Reduction Initiative (CERI) curves relate the quantity of GHGs that can be reduced or sequestered by mitigation options and the cost of mitigation per unit of GHGs reduction.

CERI curves for GHGs mitigation in the energy sector were developed from EFOM-ENV model results.

The CERI curve for the individual mitigation options (Figure 1-3) shows that most of the overall mitigation potential has a negative abatement cost; that is, the mitigation technologies result in lower overall system cost than do the BAU technologies. The option with positive cost is fuel switching in existing power stations.

Figure 1–4 illustrates how the incremental cost increases as more stringent constraints on GHGs emissions in year 2020 are placed on the energy system. In this figure, each step in the curve relates to a specific case (see Table 1-6). The initial step, which has significant negative cost, refers to the BASE case. In this figure, the emissions abatement is the quantity in year 2020 only.

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Investment cost of reducing emissions, $billion

Abatement Scenario, Gg

Scenario Base year 2000 2010 2020

SECTION 1

Figure 1-5 illustrates similar data for the model solutions when the GHGs constraint occurs gradually over the entire period. Figure 1–4: CO2 Emissions Abatement and Incremental Costs in Energy Sector; End-Year Constraint Approach

Based on the COMAP modeling results, CERI curves were developed for three scenarios. Figures 1-6, 1-7, and 1-8 express the relationship between the potential carbon reduction (or carbon stored) and cost per unit abated by the identified forestry mitigation options under the different scenarios. The types of option are the same in the Baseline and Feasible Scenarios, but the assumed rate of activity (and the cumulative abatement) is greater in the latter scenario. Forest protection is both the least-cost option and the one with the largest abatement potential. Short rotation reforestation is the most expensive option.

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EXECUTIVE SUMMARY

FIGURE 1-4 CO2 EMISSIONS ABATEMENT

AND INCREMENTAL COSTS IN

ENERGY SECTOR FIRST

APPROACH


AND INCREMENTAL COSTS IN

ENERGY SECTOR; GRADUAL

CONSTRAINT APPROACH


PAGE 13


FIGURE 1-6 FORESTRY SECTOR CERI CURVE UNDER BASELINE

SCENARIO

FIGURE 1-7 FORESTRY SECTOR CERI

CURVE UNDER FEASIBLE

SCENARIO

F1 : Enhanced natural regeneration F2 : Long rotation reforestation F3 : Short rotation reforestation

F4 : Forest protection F5 : Planting scattered trees

FIGURE 1-8 FORESTRY SECTOR CERI CURVE

UNDER TECHNICAL POTENTIAL

SCENARIO

F1 : Enhanced natural regeneration F4a : Forest protection F2 : Long rotation reforestation F4b : Degraded Forest Protection F3 : Short rotation reforestation F5 : Planting scattered trees

Figure 1-9 expresses the relationship between the potential GHGs reduction and cost per unit reduction for the agriculture sector mitigation options. Water management for rice fields to reduce methane emissions has the largest abatement potential, but is estimated to be relatively costly.

PAGE 14 VIET NAM

A1: Livestock Nutrition Improvement A2: Water Management for Rice Fields


The GHGs Abatement Action Plan developed in the ALGAS Project is described in Table 1-10.

FIGURE 1-9 AGRICULTURE SECTOR CERI CURVE

1.7 NATIONAL GHGs ABATEMENT ACTION

PLAN

TABLE 1-10 GHGS ABATEMENT ACTION PLAN

FOR VIET NAM

1. Fuel substitution in existing power stations:

Short term (1998-2005)

Establishment of attractive financing Rehabilitation of Technical capabilities mechanism. existing thermal enhanced.

Technical capacity preparation. High efficiency

Conversion of 640 MW coal-fired to oil in the North and 198 MW of oil-fired to gas in the South. Reduction of GHG

Institutional needs are:

- Technical training program.

- Experts for operation.

- Technological information.

power plant program.

Plan for offshore gas use for power generation.

generation with low GHG emissions.

emissions 5 mt CO2 equivalent in 25 year.

2. Development of hydropower and other renewable energy sources

Short term (1997-2005) Reduction of GHG by development of new and renewable energy Environmental and social assessment of

renewable energy projects, especially systems. hydropower. Guideline and advisory for priority of hydropower projects based on cost and environmental benefit.

Regulations for renewable energy projects, including temporary subsidy.

VIET NAM PAGE 15

Energy Sector

GHG Abatement Strategy Connection with

Existing Programs Objectives Fulfilled

SECTION 1

PAGE 16

EXECUTIVE SUMMARY

2. Development of hydropower and other renewable energy sources

Medium term (2005-2015)

Large scale utilization of 17,100 MW hydro capacity and renewable resources.

Implementation will be in cooperation with Electricity of Viet Nam Institute of Energy.

Institutional Needs:

Institutional strengthening and experts training on environment assessment and management.

3. Reducing power grid system loss:

Short term (1998-2005): National program for Upgraded grid system reducing grid system loss

with new standards. Rehabilitation and upgrading existing small conductors. Reducing of GHG

Application standard for new transformers

Selection of standard medium voltage levels at 20 KW.

emissions: about 300 kt CO2 in 25 years.

Implementation will be in cooperation with Government grid system rehabilitation program started in 1995.

Institutional needs:

Technical assistance on training experts.

Institutional building for monitoring and management.

4. Improving of efficiency in demand side technology:

Short term (1998-2005) Cooperation with Standard of efficiency DSM program for industrial

Collect and analyze and conduct feasibility conducted by Ministry appliances. study for standardization of electrical of Industry and WB appliances. Reducing GHG

emissions by Collect and analyze data and conduct reduction of fuel feasibility study for improvement of energy consumption. efficiency in existing State-owned industrial enterprises.

Medium term (2005 - 2015)

Adopt and implement efficiency standards for electrical appliances.

Develop and implement feasible standards for improvement of energy efficiency in existing and new State-owned industrial enterprises and building systems

VIET NAM

Energy Sector

GHG Abatement Strategy Connection with Existing Programs Objectives Fulfilled

SECTION 1

5. Establish forest plantations

Developing feasible reforestation projects To support the Expanding carbon sink

Establishing more productive plantation to reforest 5 mha in Reducing deforestation rate meet the growing demand for wood in the

country natural regeneration involved in shifting cultivation.

To pay attention to local socioeconomic Strengthening conditions and participation of the local people

"poverty alleviation" program in the

Allocating forest land to the local households program highlands and for planting mountainous areas.

Combining reforestation and natural regeneration

Developing a durable market for wood production

Provision of long-term credit with low interest rate

Provision of training and extension services

forestry program to

combination with

To support environment

for implementation of plantation programs. protection program implementation of

To support settlement

6. Forest protection

Improving the protection and management of the existing forests on conservation of sinks

Expanding the protection forest area from 5.7 to 7 mha environment development

Creating non-forest-based livelihood To support plan for Improving the opportunities establishment of 10 protection and

Encouraging local communities to take part in existing forests within forest protection activities. cultivation and the special-use forest

To support programs Enhancing carbon

forest ecosystems, bio-diversity, and Sustainable forest

national parks. management of the To support the fixed

settlement program land and protection forest land

7. Planting scattered trees

Allocate land to local households for practicing cultivation in forestry-agriculture systems environment lands in the country

To support

protection program

Planting planning scattered trees at a rate of Providing seedlings 400 million trees per year and saplings for local

Expanding urban forestry support "Re-greening

Revegetation of bare

Revegetation of cities

Enhancing carbon communities to pools.

bare land" program.

8. Information and Education :

Information and education campaign To support Raise public

Education of public on environment protection protection program environment protection environment awareness about

including forest protection and management

VIET NAM

EXECUTIVE SUMMARY

PAGE 17

Forestry Sector

GHG Abatement Strategy Connection with

Existing Programs Objectives Fulfilled

SECTION 1

1.7.1 GHGs ABATEMENT ACTION

PLAN IN THE ENERGY SECTOR

PAGE 18

EXECUTIVE SUMMARY

9. Reduce methane emissions from rice cultivation while maintaining or increasing yield in rice production

Implementation : Program to make Increasing rice more intensive productivity and cultivation of food efficiency of Farm experimental trials for water

management in rice paddy will be crop production cost conducted in Red River Delta.

Reduce GHGs emissions from rice

Developing the applicable study

Improving the awareness of the society to GHGs emissions

To transfer the technology of water irrigating and draining in rice field

Monitoring and evaluation

paddy (CH4)

Institutional needs

Upgrade capability of project staff for implementation

Exchange information through training/seminar workshop

Farmers

10. Improving nutrition through mechanical and chemical feed processing

Increasing the quantity and quality of livestock feed to improve meat production.

Reducing methane emissions from livestock

The overall national policy in the energy sector is to satisfy the energy demand for long-term development of the country with a high GDP growth rate, and provide national, regional, and global environmental benefit. The specific objectives of the Action Plan based on the National Energy Development Program (NEDP) focuses on development of clean energy sources, with special attention given to:

Hydroelectricity,

Nuclear electricity.

The National GHGs Abatement Action Plan will be developed in the National Energy Environment Plan (NEEP) through sectoral regional and national strategies and socioeconomic development plans. The main environmental implications considered in the NEEP are the emissions of CO2, SO2, NOx and dust. For environmental management, a system of regulation based on cost-benefit with environment assessment analysis will be

VIET NAM

Thermal electricity generation based on natural gas, and

Agriculture Sector

GHG Abatement Strategy Connection with Existing Programs

Objectives Fulfilled

SECTION 1

developed. The appropriate environmental policies will be undertaken in the energy sector based on a least-cost plan, recognizing the environmental impacts. The following issues are considered in development of the national policies:

Energy efficiency Renewable energy exploitation Environmental standards and environment cost benefit analysis for

energy projects.

The Action Plan calls for implementing the identified abatement options and projects through short, medium, and long term measures.

For implementation of the Action Plan, the National Climate Change Office should work in close linkage with all sectoral environmental offices, energy management offices, and energy monitoring offices, such as the DSM Cell and Energy Efficiency Office. The Climate Change Office will coordinate activities taken under the action plan and specific projects will be implemented by sectoral agencies.

The main document on the economic and social development of Viet Nam specifically indicates that the forestry sector should concentrate on (i) improving the economic results of the operations, (ii) increasing the rate of forest plantation, (iii) accelerating revegetation of bare hills, (iv) improving the results of forest exploitation, and (v) creating a forest resource capable of protecting the environment and harboring diverse wildlife. In the next decade, several concrete objectives for the forestry sector include:

Strengthen the national protection capability by means of protecting 9.3 mha of existing forests, increasing the rate of forest plantation, and accelerating revegetation of bare hills. Focus on activities concerning natural forest regeneration, establishment of new plantations in order to reforest 5 mha in the period 1998- 2010. Up to the year 2010, there will be more than 15 mha of forests all over the country. To increase forest coverage to 45 percent by the year 2010. Provide employment for local people and improve the living standard for more than 20 million people living in and around forest areas.

For the forestry sector, the GHGs abatement action plan is focused on several activities:

Forest plantation establishment Forest protection/conservation Planting scattered trees Information and education.

In order to implement the forestry options successfully, it is necessary to encourage all other economic sectors as well as local communities to take part in forest operations. A forest management system should be established from central to local levels (MARD Provinces Districts Communes), and links

VIET NAM

EXECUTIVE SUMMARY


PLAN IN THE FORESTRY

SECTOR

PAGE 19

SECTION 1


PLAN IN AGRICULTURE

SECTOR

PAGE 20

EXECUTIVE SUMMARY

between forestry and agriculture need to be strengthened. Also, a credit system should be developed to deliver soft credit directly to local people participating in forest programs.

in the forestry sector is as follows. The proposed time-line for implementing the GHGs abatement strategy

Short term (1998 - 2005):

Reforestation at a rate of 140,000 ha of degraded forest land per year. Planting 1.5 billion scattered trees. Protecting 6.5 mha of natural forests. Rehabilitating 1.8 mha of degraded forests.

Medium term (2005 - 2015):

Reforestation at a rate of 100,000 ha of degraded forest land per year. Planting 2 billion scattered trees. Continue rehabilitating 1.8 mha of degraded forests. Continue protecting the natural forest, expanding protected land area, and maintaining forest plantations.

Long term (beyond 2015):

Revegetating 0.8 mha of wasteland. Planting 0.5 billion scattered trees. Harvesting a number of forest products from forest plantations that were established in the short-term period (1998 - 2005) to meet the in-country demand as well as wood export. Determining the GHGs mitigation options that should be continued and new options and strategies that need to be formulated.

The strategy for the agriculture sector is to satisfy the food requirements for the people’s consumption in any situation, to assure the food source through development of breeding and provision of enough raw materials for the industry, and to effectively increase the export volume. These goals are supported by the following programs:

Diversification of agriculture.

The mitigation measure for methane emissions from rice fields is controlling water irrigation and the intermittent draining of rice fields during the end of tilling and after flowering. It is expected that implementation of this practice will result in significant reduction of methane emissions from the agriculture sector in coming years.

Methane emissions from the livestock subsector will be mitigated by improving nutrition and through mechanical and chemical feed processing.

Intensification of cultivation and increasing productivity of the food crops.

VIET NAM

SECTION 1

There are five projects proposed in the Viet Nam ALGAS Project. A summary of the priority projects is presented in Table 1-11.

(i) The National Action Plan for implementing UNFCCC will integrate all sectoral plans addressed to GHGs abatement and climate change adaptation strategies. This plan will be submitted to the Government for approval.

(ii) The Government should establish an organization that will have a legally well defined mandate, logistically well supported operation, and technically skilled personnel to implement the National Action Plan. The tasks and functions of the organization will include GHGs inventory, database management, and monitoring and evaluation of GHGs emissions, programs, policy, projects and activities related to GHGs reduction.

The Viet Nam Climate Change Country Team (VNCCCT) was established in 1994, with a mandate to improve knowledge on climate change and its social, economic, and environment impacts. The VNCCCT is represented by all the relevant ministries and government agencies relating to climate change issues. It will play a key role in the implementation of the National Action Plan.

iii) In the energy sector, the National Energy Plan should integrate energy efficiency for both the supply and demand sides. In the forestry sector, the programs such as forest protection, watershed management, biodiversity conservation, reforestation, and settlement of shifting cultivation will be performed to implement the GHGs abatement strategies. In the agriculture sector, reducing methane emissions from rice paddy should be included in the program of making more intensive cultivation of the food crops.

iv) The establishment of demonstration projects can help to show the barriers and constraints of implementation and also show the best way to carry out programs and projects.

v) There is a need to build and strengthen the national capacity to integrate climate change concerns into medium- and long-term planning. This should include education and training on climate change for national development planners, as well as for policy decision- makers from all relevant ministries and government agencies.

At the United Nations Conference on Environment and Development (UNCED) in Rio de Janeiro, Brazil, June 1992, Viet Nam signed the United Nations Framework Convention on Climate Change (UNFCCC). Viet Nam Government ratified the Convention on 16th November 1994.

optimize its organizing capacity to undertake the relevant responsibilities to the implementation of UNFCCC, although Viet Nam has emphasized that it is not obligated to reduce its GHGs emissions.

As a non-Annex I country, the Government of Viet Nam will try its best to

VIET NAM

EXECUTIVE SUMMARY

1.7.4 PRIORITY GHGS MITIGATION

PROJECTS

1.7.5 INSTITUTIONAL MEASURES/ INITIATIVES

1.8 CONCLUSION AND

RECOMMENDATIONS

PAGE 21


TABLE 1-11 SUMMARY OF PRIORITY GHGs

MITIGATION PROJECTS

Reduce GHGs emissions by improving the efficiency of fossil fuel combustion in industrial processes.

Reduce the demand for energy inputs to industrial processes. 2 years $1 million GEF

Provide information to the industry sector institutions in the form of an inventory of energy-efficient, best available technologies and processes.

Save energy in cement plant by recovery of waste heat.

Reduce GHGs emissions from cement production by reducing fuel consumption.

GEF, AIJ, 3 years $10 million Japan

Reduce GHGs emissions by improving the efficiency of fossil fuel boilers in industry.

Capacity building of industrial institutions to implement efficient boilers.

4 years $0.8 million GEF

Conserve up-river forest and enhance carbon sink.

Establish 12,500 ha of pinus 4 years $2.8 million Government massoniana GEF

Conserve soil and water

German

Reduce methane emissions from rice fields.

Increase rice production in response to people’s consumption requirement.

3 years $1.5 million GEF

PAGE 22 VIET NAM

5. Water management for reducing methane emissions from rice fields in the Red River Delta

4. Reforestation for conservation and expension of carbon sink in Lang Son, Ha Bac province

3. Energy efficiency measures for industrial boiler

2. Waste heat recovery and power generation from cement factor

1. Improvement in energy efficiency fuel combustion of industrial processes

Key Objectives of the Project Anticipated

Time-line Estimated

Budget Potential Funding

Sour

SECTION 1

One of the activities for climate change in Viet Nam is the Asia Least- cost Greenhouse Gas Abatement Strategies (ALGAS) Project. The tasks completed by the ALGAS Project include the (i) development of a National Greenhouse Gas Inventory using 1993 as the base year, (ii) development of baseline projection of GHGs emissions up to year 2020, (iii) development of mitigation options for abating GHGs emissions, (iv) formulation of least-cost abatement strategies, and (v) development of priority GHGs abatement projects.

The national GHGs abatement strategies developed in this study will facilitate development of the Country Program for effective implementation of Viet Nam's commitments as a developing country under UNFCCC. The timeline for implementation of the GHGs abatement strategy is as follows.

In the short term:

Strengthen the organization established to implement the Climate Change Action Plan. Disseminate the Country Program for implementing UNFCCC in order to include it in the existing plans, programs, and future national development plans. Build the database on GHGs sources and sinks. Design project proposals for funding. Develop monitoring and evaluation procedures on GHGs emissions and abatement.

Publish awareness building materials.

In the medium term:

Implementation of technical assistance and investment projects. Monitoring and evaluation of GHGs emissions and abatement

In the long term:

Continue public information campaign. Implement other investment projects and sectoral plans.

Financing sources for the GHGs mitigation initiatives include:

Government funds. Private sector. GEF.

Bilateral and multilateral GHGs mitigation assistance. Non-refundable aid from foreign governments.

VIET NAM

EXECUTIVE SUMMARY

PAGE 23

SECTION 2 INTRODUCTION AND

BACKGROUND

he territory of Viet Nam includes the land area of 330,990 km2 and immense sea space with thousands of islands. Its territorial waters are T 12 miles wide, and the sea exclusive economic zone is 200 miles wide

covering an area about 1 million km2. The territory ranges from 23o23' to 08o02' North latitude and from 102o08'

to 109o28' East longitude. Viet Nam is 1,650 km long from North to South. From West to East the widest part is 600 km and the narrowest part is 50 km only. The entire length of the coastline is 3,260 km.

Viet Nam has a great number of mountains; many of them have a height of more than 2,500 meters. The mountainous area occupies three-fourths of land territory. There are more than 2,860 large and small rivers; among these rivers more than 2,300 have a length of more than 10 km. On average, there is an outlet approximately every 20 km along the coastline. The Red River of North Viet Nam and the Mekong River of South Viet Nam are the largest and most important ones.

Viet Nam possesses a monsoon tropical climate, characterized by a tropical solar radiation regime with plentiful total solar radiation and positive values of monthly solar radiation balance. It also has a monsoon wind regime marked by a noticeable change of prevailing winds from summer to winter. Annual mean temperature ranges from 8°C - 29°C, varying with latitude and altitude. The monthly mean temperature of the coldest month (December or January) is about 13°C - 20°C in the northern parts, and mountains in South Viet Nam at a height of more than 1,000 meters. The coldest month mean temperature is about 20°C - 25°C in the plains and in the mountains with the height less than 1,000 meters in the southern parts. The temperature in the hottest month (between March and July) is about 25°C - 30°C in the plains throughout the territory and decreases with altitude. Throughout the territory, including highlands, midlands, and plains, annual mean rainfall ranges from 600 - 5,000 mm with 100 - 200 days of rain annually. The rainy season is from April/May to September/October in most parts of the territory, and from August/September to December/January in several coastal regions of central Viet Nam. The annual mean number of typhoons is four to five for the period of 1901-1960 and six to seven in the past three decades.

sunshine hours, 3,000oC - 10,000oC accumulated temperature above 10oC, and 60 - 200 rainy days, with a rainfall of 600 - 5,000 mm.

In various parts of the Viet Nam territory annually there are 1,500-2,000

Viet Nam possesses a total land area of more than 33 mha. More than 7.3 mha are arable land and 9 mha are forestland. Specially used land and homestead lands occupy 1.17 mha 0.77 mha, respectively. It is noteworthy that there are14.2 mha of wasteland, and 19 mha are classified as forestland.

The country has 13 main soil groups, of which the most important ones are red yellow soil (15.8 mha), red-yellow humors (2.97 mha), alluvium (2.93 mha), gray soil (2.48 mha), and salted (0.99 rnha).

open tree stands. The forests have about 800 different varieties of trees and about 60 varieties of bamboo.

According to preliminary statistics, during the 10 years from 1981 to 1990, 184,500 ha of forest were burned for farming; 229,300 ha experienced fire and 114,500 ha were damaged by insects and diseases. Because of the rapid forest depletion, the bare land and bald hills occupy more than 11.4 mha.

Half of the forestland bears dense forest and the rest is covered by bush or

VIET NAM

2.1 COUNTRY PROFILE

2.1.1 GEOGRAPHY

2.1.2 LAND USE PATTERN

PAGE 27

SECTION 2

2.1.3 SOCIETY

2.1.4 ECONOMY

PAGE 28

INTRODUCTION AND BACKGROUND

Viet Nam had a population of 71 million in 1993. The estimated population in 1995 was 74 million. It has a high rate of population growth. On average, the population growth rate is 2.23 percent per year. During the last 10 years the growth rate has been decreasing. In 1993, urban population constituted approximately 20 percent of the total population. According to the survey carried out in July 1994, the total number of rural households is 12 million. The labor force is 45.8 percent of the population. In cities, the majority of the labor force work in industrial and commercial activities or other services. In villages, most of the population take part in agricultural production. In coastal zones and islands, most of the population work in fishery.

The monthly average income over the whole country is D119,000, and urban and rural average monthly income are D220,000 and D94,000, respectively. About 65.8 percent of the population has less than the average income, and poor households consist of 40.9 percent of the total.

Viet Nam has a young population with a high labor proportion and literacy rate. At present the population aged under 20 years comprises about 49 percent, and the population of working age comprises more than 50 percent of the total. According to the 1989 census, 87.7 percent of the population aged 10 years and over were literate.

Viet Nam still remains a backward agricultural-based economy. In 1993, products from the industry, agriculture, and service sectors constituted 28.9, 29.9, and 41.2 percent of the gross domestic product (GDP), respectively.

In agriculture, the gross output of cultivation and animal husbandry contribute 74 and 26 percent, respectively, of the total output. Industry is structured by electricity, fuels, ferrous and non-ferrous metallurgy, equipment and machinery, electrical products, chemical products, fertilizers, construction materials, cellulose and paper, wood and wood products, foodstuffs, textile products, sewing products, tanning and manufactured leather products, printings, etc.

Industrial production reached a growth rate of 10.0 percent in 1991, 17.1 percent in 1992, 12.7 percent in 1993, 13.7 percent in 1994, and 14 percent in 1995. Growth rates differed from sector to sector: crude oil, 23.3 percent; power, 20.8 percent; cement, 18.3 percent; rolling steel, 30.3 percent; tool machinery, 14.8 percent; chemical fertilizer, 20.4 percent.

In 1993, the GDP was D136,571 billion, or approximately $14 billion, equivalent to approximately $200 per capita.

In the five years 1991-1995, the economy of Viet Nam was characterized by a relatively high economic growth rate in most sectors: 12.5 percent in industry, 9.1 percent in services, and 4.3 percent in agriculture. The average GDP growth rate in the period reached 8.2 percent. It was 8.8 percent in 1994 and 9.5 percent in 1995.

The main products in 1993 are given below:

Food output

Paddy: 22.850 mt; other cereals in paddy equivalent: 2.650 mt Total: 25.500 mt

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SECTION 2

Animal husbandry

Buffaloes: 2,960 thousand Cattle : 3,333 thousand Pigs: 14,874 thousand

Forest and fishery products

Wood: 2,884 thousand m3

Sea fish : 660 thousand tonnes Salt: 650 thousand tonnes

Industrial products

Electricity: 10,851 million kWh Coal: 5.90 mt Cement: 4.85 mt Crude oil : 6.30 mt Barred tin: 3.57 thousand tonnes Rolled Steel: 243 thousand tonnes Machine tools: 1,517 pieces Tractors: 2,316 pieces Electric motors: 23,888 pieces

Products for agriculture

Appetite ore: 362 thousand tonnes Chemical fertilizer: 714 thousand tonnes Insecticides: 14.0 thousand tonnes

Viet Nam is a developing country with limited resources that have been degraded due to years of war and severe pressures from the rapidly increasing population. However, after several years of construction, the environment has exhibited a sustainable development trend.

Viet Nam has abundant sources of water with 653,020 ha of rivers, 394,000 ha of lakes, 56,000 ha of ponds, 85,000 ha of swamp, and 1 mha of land under mangrove. There are 2,345 rivers with a length longer than 10 km.

the total area of the country. Natural forests cover 8.6 mha. The forests belong to a multi-life system with 800 varieties of trees with a reserve of more than 600 m3, and about 60 varieties of bamboo with more than 5.5 billion trees. Forest life species include 275 species of animals, 286 species of birds, 100 species of amphibians, 180 species of reptiles, and several big animals such as elephant, tiger, wild buffalo bull, gray bull, etc,. In addition, there are other forest animals: monkeys, goats, wild boars, foxes, etc.

were burned for farming, 229,300 ha were burned from natural causes, and insects and diseases damaged 114,500 ha. Because of rapid forest depletion, the bare land hills now occupy more than 11.4 mha.

There are approximately 20 mha of forests, accounting for two-thirds of

According to preliminary statistics, during 1981-1990 184,500 ha of forests

VIET NAM


2.1.5 EnvIRONMENT

PAGE 29

SECTION 2

2.1.6 STATUS OF CLIMATE CHANGE

ACTIVITIES

2.2 NATIONAL DEVELOPMENT

OBJECTIVES

PAGE 30


The following activities have been carried out during recent years.

Development of UNFCCC compliance monitoring mechanism

Viet Nam signed UNFCCC in June 1992 and ratified the Convention in November 1994. In July 1994 the Hydrometeorological Service (HMS) was designated as the principal National Counterpart Agency for projects and issues related to climate change. Since then a Country Team on Climate Change has been established. The Country Team consists of 21 members from Government Office; Ministry of Science, Technology and Environment; Ministry of Foreign Affairs; Ministry of Planning and Investment; Ministry of Industry; Ministry of Agriculture and Rural Development; Ministry of Transportation; Ministry of Legislation; Ministry of Trade; Ministry of Education and Training; Ministry of Finance; and Ministry of Public Health.

Participation in regional and golbal projects related to climate change

(i) Regional Study on Global Environmental Issues (1992-1993) (ii) Climate Change: Train (1994-1995) (iii) Asia Least-cost Greenhouse Gas Abatement Strategy (ALGAS) (1995-

(iv) Economics of Greenhouse Gases GHGs Limitation (1996-1998) (v) Socioeconomic and Physical Approaches to Analysis of Climate

(vi) Country Study; German Agency for Technical Cooperation (1995) (vii) Vulnerability Assessment in Viet Nam (1994-1995)

Research on different subjects related to climate change

1997)

Change Impacts in Viet Nam (1995)

(i) Grade and features of climate variation in recent decades and its tendency in coming decades

(ii) Scenarios of climate change in the near and far future (iii) Features of potential and current climate change and its impacts on

socioeconomic activities

Establish and implement National Program on Climate Change

(i) Prepare National GHGs Inventory and Initial National Communica- tion;

(ii) Promote plans for observing, measuring, and studying climate change;

(iii) Promote plans for prevention and mitigation of natural disasters; (iv) Promote plans for enhancing public awareness; (v) Assist and support the preparation of projects related to climate

(vi) Study to enhance the GHGs inventory and GHGs mitigation assessment.

Viet Nam has launched a campaign to gradually shift the economy to a new development stage. The principal objective for the economy is that Viet Nam should be included in the list of new industrial countries by the year 2020 with an industrial share of total GDP of more than 40 percent.

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change; and

SECTION 2

During 1996-2000 Viet Nam’s economy should achieve an average annual growth rate of 8.5 percent. Agriculture (including forestry and fishery) should experience an annual increase of 4.2 percent, industry (including construction) 12.5 percent, and the service sector 7.6 percent. With such a growth pattern, GDP at 1994 prices will reach $26 billion by the year 2000.

Up to the year 2000, the area of rice field is projected to increase to 7.0 mha, and food output is projected to continue its rapid increase. The food output is expected to be not less than 20 mt of rice equivalent. By the year 2000, the area of forest cover is projected to increase to 11 mha and forest coverage is projected to be more than 30 percent.

is projected to reach $108 billion. The share of industry, services, and agriculture of the total GDP is projected to be 44.0 percent, 43.9 percent, and 12.1 percent, respectively. The GDP per capita is expected to reach $1,025 per person. In order to gain this objective, the growth rate of the total GDP should be 7.8 percent in the period 2001 to 2010 and 7 percent in the period 2011 to 2020.

According to the Government’s plan, by the year 2020 the area of rice fields is projected to be 7.7 mha and rice production is projected to reach 44 mt per year. Livestock population is projected at 7 million cattle, 4.5 million buffaloes, and 38 million swine.

be established by 2020. In addition, 5 mha of new forests is to be created by 2010, increasing forest coverage to 45 percent of the country.

The energy sector, at present and in the future, is one of the most important forces of economic development in Viet Nam. The high growth rate of the economy leads to the use of more energy, and the primary energy supply should be adequate to meet the energy demand.

By the year 2020, with a population of 105 million persons, the total GDP

For the forestry sector, a system of protection forest covering 8 mha is to

Department of Agriculture. 1996. Forestry and Fishery Statistical Data of Agriculture Forestry and Fishery, 1985-1995. Statistical Publishing House, Ha Noi.

General Statistical Office. 1996. Statistical Yearbook 1995. Statistical Publishing House, Ha Noi.

Industrial Department - General Statistical Office. 1994. Industrial Data 1989-1993, Statistical Publishing House, Ha Noi.

Nguyen Duc Ngu - Nguyen Trong Hieu. 1988. Climate Resources of Viet Nam - Scientific and Technical Publishing House, Ha Noi.

Socialist Republic of Viet Nam. 1995. Government Report to the Consulta-tive Group Meeting in Paris, 1995 “Socioeconomic development and investment requirements for the five years 1996-2000”. Ha Noi.

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REFERENCES

PAGE 31

SECTION 2

PAGE 32


Tran Hoang Kim. 1996. Viet Nam’s Economy - The period 1945-1995 and its perspective by the year 2020. Statistical Publishing House, Ha Noi.

UNEP. 1993. - Environment Perspective to the year 2000 and Beyond. Viet Nam Infoterra Centre, Ha Noi.

VIET NAM

SECTION 3ENERGY SECTOR

ASSESSMENT

iet Nam has recently succeeded in maintaining high growth with good macroeconomic performance. This development has required V increased demand for energy; as society develops, the economy

expands, and the demand for energy becomes greater.

with Viet Nam’s GDP growth of 8.8 percent per year from 1992 to 1995 (Table 3-1), primary energy consumption in the country grew significantly from 7,530 ktoe in 1992 to 11,270 ktoe in 1995, an average annual growth rate of 14.4 percent.

As economic expansion continues energy consumption increases. Along

1992 8.6 14.5 7,531.5

1993 8.1 16.8 8,800.7

1994 8.8 14.7 10,100.0

1995 9.5 11.6 11,269.9

Source: Statistical Yearbook 1992-1996 Report of national project KC.03.01, 1995 Institute of Energy

Favorable conditions for economic development mean Viet Nam’s rapid economic development is likely to continue. According to the latest economic projection by the Ministry of Planning and Investment in 1998, the annual average GDP growth rates will be 8.5 percent, 7.8 percent, and 7 percent in the periods 1996-2000, 2001-2010, and 2011-2020, respectively (Table 3-2). This means that a large amount of energy will be consumed in the corresponding periods because energy is vital for the development of industry and commerce, which will sustain a high rate of economic growth.

GDP is the total production from three main economic sectors: industry and construction, agriculture, and service. Of these three, the industry and construction is the most energy intensive and has the highest growth rates: 12.5 percent in 1996-2000, 10 percent in 2001-2010 and 8 percent in 2011- 2020 (Table 3-2). The industrial sector plays a major and increasing share in economy (30 percent, 35.5 percent, 41.5 percent, and 44 percent in the years 1995, 2000, 2010 and 2020, respectively) (Table 3-3). Thus this sector is expected to use the largest amounts of energy. Energy demand is expected to continue increasing during the two coming decades, reaching 101,378.89 ktoe of primary energy by the year 2020. This increase in energy use will cause an increase in the growth of GHGs emissions.

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3.1 INTRODUCTION AND

BACKGROUND

TABLE 3-1 GROWTH RATE OF GDP AND

PRIMARY ENERGY CONSUMPTION,

1992-1995

PAGE 35

Year GDP Growth

Rate, percent

Growth Rate of Primary Energy Consumption,

percent

Primary Energy Consumption,

ktoe

1992-1995 8.8 14.4

SECTION 3

TABLE 3-2 ANNUAL GDP GROWTH RATE

FORECAST BY SECTOR, 1996- 2020

TABLE 3-3 THE SHARE OF GDP BY

SECTOR, 1996-2020

PAGE 36

ENERGY ASSESSMENT SECTOR

GDP 8.5 7.8 7.0

Industry + Construction 12.5 10.0 8.0

Agriculture 4.2 4.2 3.0

Service 7.6 7.3 7.1

Source: Development Strategic Institute, Ministry of Planning and Investment, 1998.

GDP 100 100 100 100

Industry + Construction 30.0 35.5 41.5 44.0

Agriculture 28.4 22.5 15.5 12.1

Service 41.6 42.0 43.0 43.9

Source Development Strategic Institute, Ministry of Planning and Investment, 1998.

Compared to most of other developing countries, Viet Nam is relatively rich in primary energy resources. Coal deposits, located in the north, are estimated to have recoverable reserves of 3,410.1 million tonnes (mt) of anthracite, 383 mt of lignite and 100 billion tonnes (bt) of bituminous (Report of Viet Nam Coal, 1998). Viet Nam’s overall hydro potential is estimated at 17,000 MW with about 70 percent in the North (Energy Institute, 1997). Crude oil reserves have been discovered in the southern offshore areas with recoverable reserves of 1 billion barrels (World Bank report, 1993), and production increased to 8.6 mt in 1996. The natural gas reserves of 3 trillion ft3 were identified in 1993 (World Bank report, 1993). Despite these energy resources, Viet Nam has one of the lowest levels of energy consumption in the developing world. However, energy consumption per capita has increased continuously from 63.6 kgoe in 1985 to 64.2 kgoe in 1990, reaching 91.2 kgoe in 1994 which reflects an improvement in the country’s standard of living.

characterized by its behavior in three periods: from 1980 to 1985 when there was a centralized economic system, energy consumption was more or less constant, petroleum product consumption, and electricity grew at about 8.9 percent per year. During this period, supplies of both petroleum and electricity were limited. From 1986 to 1990, after the beginning of economic reform, petroleum products and electricity consumption began increasing. The third period, from 1990 to 1994, was characterized by a rapid increase in all types of energy consumption. Total final energy consumption increased from 4,249 ktoe in 1990 to 6,613 ktoe in 1994 (Table 3-4), at an average annual rate of about 12 percent, a trend which is expected to continue and lead to an increase of the growth of GHGs emissions.

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During the past 15 years, the development of the energy sector may be

Sector 1996-2001 2001-2010 2011-2020

Value added

Sector 1995 2000 2010 2020

Value Added

SECTION 3

Coal 000 t 3,406.0 2,463.0 3,237.0

Petrol Products 000 t 1,439.0 2,279.0 3,908.0

Electricity GWh 3,867.0 6,185.0 9,257.0

Population Million 59.87 66.23 72.51

Energy/Capita kgoe/capita 63.61 64.16 91.21

Source: Report of national project KC.03.01, 1995 Statistical yearbook 1985, 1990, 1994

Total energy consumption rose rapidly from 4,529 ktoe in 1991 to 6,731 ktoe in 1994 with an annual average growth rate of 14 percent (Table 3-5). Liquid fuel was the dominant type of fuel consumed, with an average growth rate of 19 percent per year. Liquid fuel consumption reached 4,034 ktoe in 1993 and 4,591 ktoe in 1994; solid fossil fuel consumption doubled during the same year. The difference in consumption of these fuels was not so great during 1991-1992, a result of growing demand in the industrial, transportation, residential, and commercial sectors for liquid fuel for power generation. Natural gas has been used for power generation and contributed a small part too in fossil fuel consumption.

Energy is consumed in Viet Nam primarily by five major economic sectors: industrial, transportation, agricultural, residential, and commercial. Among these the industrial sector has been the largest consumer of fossil fuel. Its consumption was 2,408 ktoe in 1994 (Table 3-5), increasing from 1,859 ktoe in 1991, accounting for more than 30 percent of total fossil consumption. The combined residential and commercial sector followed with 1,944 ktoe in 1994, rising from 879 ktoe in 1991. The share of the residential and commercial sectors increased from 19 percent in 1991 to 28 percent in 1994. Fossil fuel consumption for power generation decreased lightly to 914 ktoe in 1994 from 936 ktoe in 1991 because of substitution of petroleum products from coal (these products have a higher efficiency in power generation). The sector with the lowest consumption is agriculture. Its share was only 4 percent between 1992 and 1994.

Industry 991.0 770.7 825.5 876.3

Transportation 26.6 11.3 9.0 9.6

Agriculture 12.4 4.5 3.4 3.6

Residential and Commercial 254.3 924.4 884.3 939.1

Power generation 502.9 394.5 305.6 305.1

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TABLE 3-4 FINAL ENERGY CONSUMPTION, 1985-1994

TABLE 3-5 ENERGY CONSUMPTION BY

POWER GENERATION (1991- 1994), KTOE

ECONOMIC SECTOR AND

PAGE 37

Total ktoe 3,808.8 4,249.4 6,613.4

Units 1985 1990 1994

Solid fossil 1786.8 2105.4 2027.8 2133.7

Economic Sector 1991 1992 1993 1994

SECTION 3

3.2 ENERGY SECTOR GHGs

3.2.1 INTRODUCTION

INVENTORY

PAGE 38


Industry 868.1 896.2 1,248.6 1,531.2

Transportation 669.1 780.0 1,039.6 1,169.1

Agriculture 148.1 164.4 251.1 283.1

Residential and Commercial 624.2 603.4 885.1 1,005.3



Industry 1,859.1 1,666.9 2,074.1 2,407.5

Transportation 695.3 791.3 1,048.6 1,178.7

Agriculture 160.5 168.9 254.5 286.7

Residential and Commercial 878.5 1,527.8 1,769.4 1,944.4


Source: Report of national project KC.03.01, 1995.

The first GHGs inventory for the energy sector in Viet Nam was compiled in 1992-1993, and it covered only the emissions from combustion activities in 1990. For that inventory, National Technical Experts (NTEs) employed the methodology proposed by the Organization for Economic Cooperation and Development (OECD).

The Energy Economics Division of Hanoi University of Technology conducted the sector GHGs Inventory for this report. It involved the cooperation of various institutions including Electricity of Viet Nam, the Institute of Meteorology and Hydrology (IMH), the Institute of Energy, the Institute of Transport Science and Technology, and the Ministry of Planning and Investment. GHGs emissions from the energy sector in 1993 were estimated from energy combustion and fugitive emissions. The results are presented in Standard Format of the Intergovernmental Panel on Climate Change (IPCC).

fugitive emissions from production activities. Combustion activities cover emissions of CO2 and non-CO2 emissions from fuel-burning processes. The main fuel types are listed below:

This GHGs emission inventory includes activities of energy combustion and

Solid fuel: Coal, mostly anthracite Liquid fuel: Gasoline

Diesel oil

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Liquid 2,727.7 2,886.0 4,034.7 4,591.5

Economic Sector 1991 1992 1993 1994

Natural gas 14.9 2.5 6.4 5.8

Total fossil fuel

Total 4,529.4 4,993.9 6,068.6 6,731.0

SECTION 3

Residual oil Fuel oil Other oil

Biomass: Wood fuel Agricultural residues

The study estimated GHGs emissions from all energy combustion activities including:

Energy combustion for transportation, Biomass burning.

Fugitive emissions were estimated from coal production as well as production of crude oil and natural gas. Fugitive emissions from coal mining include methane CH4. Fugitive emissions from crude oil and natural gas are also in the form of CH4. The production processes that cause fugitive emissions are:

Energy transformation, i.e., power generation, Fuel combustion for the energy industry,

Combustion in the residential sector, and

Post-mining activities Crude oil production Natural gas production Flaring: emissions from burning of discarded and associated gas

during production

Coal mining: underground and surface mining activities

a. Methods

Under the IPCC guidelines for National GHGs Inventory, three steps were taken to estimate GHGs emissions from energy sources in Viet Nam.

Baseline data were collected for the sectors covered using a top- down approach, and secondary sources. Appropriate emissions coefficients were selected from among IPCC emissions coefficients for each type of energy in the study. IPCC procedures were applied to estimate GHGs emissions using the Global Average method for fugitive emissions and production- based average emission factors for fuel combustion.

b. Assumptions

The following assumptions were used in the calculation of GHGs emissions:

Emissions of almost all GHGs in the energy sector come from burning fossil and traditional biomass fuels. The calorific value given by IPCC was used for domestic anthracite.

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3.2.2 METHODOLOGY

PAGE 39

SECTION 3

3.2.3 DATA SOURCES

3.2.4 RESULTS

TABLE 3-6 GHGs EMISSIONS FROM FUEL

COMBUSTION BY FUEL TYPE

AND SECTOR IN 1993, GG

PAGE 40


Traditional biomass fuels consist of wood and rice residues. The consumption of these fuels is estimated based on per-capita consumption data provided for rural and urban areas by the Energy Institute. CO2 emissions were estimated based on the basic IPCC assumption and carbon contents of each fuel consumed by various economic sectors. The emission factor for road transportation is adopted from the results of an Indian study. This choice was based on the technological similarity between road transportation vehicles in India and Viet Nam.

The data for energy production, storage, and consumption in Viet Nam come from secondary sources, listed by fuel types and by economic sectors. These data were obtained from the results of the report of national project KC.03.01, 1995.

Biomass consumption data were estimated based on an average per-capita consumption per capita rural and urban areas provided by the Energy Institute.

Most coefficients used are those given by the IPCC. The emissions factors for CO2 in the transportation sector and for CH4 were based on the results of an Indian study.

The results of the estimation of GHGs emissions from energy sector sources in Viet Nam in 1993 are presented in Table 3-6. It is estimated that coal production emitted 78 Mg of methane and 7,352 Gg of CO2. Total emissions from fossil fuel reached 22,939 Gg CO2-equivalent in 1993. The industry sector had the highest GHGs emissions (6,932 Gg CO2-equivalent in 1993, followed by power generation (Table 3-6).

8,790.23 Coal 7,351.92 0.78 4.59 18.35 15.161

FO 2,384.88 0.5 1.31 0.42 0.485 2,792.88

DO 6,285.89 0.14 0.54 21.36 6.962 6,455.84

Gasoline 2,732.08 0.95 0.99 10.82 103.753 3,057.40

Kerosene 571.77 0.01 0.38 1.27 0.139 688.91

Other oil products 506.93 506.93

Gas 17.40 17.40

Total 19,850.87 164.30 8.92 90.81 1547.34 26,066.68

Power generation 3,585.76 0.77 7.54 27.77 13.79 5,939.33

Industry 6,931.54 6,931.54

Transportation 2,663.90 0.92 0.16 66.99 199.55 2,732.82

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Fossil fuel 19,850.87 1.92 7.80 52.22 126.5 22,309.59

Biomass 162.38 1.12 38.59 1420.84 3,757.18

Sector

Fossil fuel 19,833.47 1.88 9.89 64.07 216.54 22,938.85

Fuel type CO2 CH4 N2O NOx CO CO2-equivalent, CO2+CH4+N2O

SECTION 3

Com. & service 3,818.00 0.12 1.46 5.30 2.20 4,273.12

Others 2,834.27 0.07 0.73 2.60 1.00 3,062.04

Solid fuel 38.09 799.89

Oil and Natural gas

Total 19,833.47 202.35 11.01 141.25 1,637.38 27,495.92

Source: Report of GHG inventory under ALGAS project, 1995

1. End-use:

The industrial sector emitted 7 mt of CO2-equivalent or 40 percent of the total energy sector emissions.

The commercial and service sector emitted 4 mt of CO2-equivalent or 18 percent of the total emission from the energy sector. Emission contained 3.8 mt of CO2, small amounts of nitrous oxide, and negligible amounts of methane.

The transport sector emitted 2.7 mt of CO2-equivalent or 11 percent of total emissions from energy sector. Carbon monoxide (CO) emissions were about 200 mt with a small amount of NOx, and a negligible amount of CH4.

The other sectors, including agriculture, emitted 3 mt of CO2-equivalent or 13 percent of the total emissions from energy sector. These emissions consist almost entirely of CO2; amounts of other gases were negligible.

2. Conversion:

The power sector emitted 6 mt of carbon dioxide equivalent or 25 percent of total emissions from the energy sector. Emissions were mainly CO2 (3.5 mt), with negligible amounts of CH4, N2O, and CO.

3. Fugitive:

Activities that generate fugitive emissions in Viet Nam include coal, oil, and gas exploitation and production. However, the data used for the estimation of fugitive emissions from oil - gas production in 1993 were not available, so fugitive emissions are estimated for coal mining only, including underground and surface mining activities. There are no local specific emission factors in Viet Nam, so fugitive methane emissions from coal mining is estimated based on CH4 emission coefficients used in India for different types of mining. Fugitive emissions from fossil fuel contained about 0.8 mt of CO2-equivalent or 3 percent of total emissions from the energy sector. Emissions of methane were about 0.076 mt.

emissions (about 90 percent in Viet Nam). Methane and nitrous oxide emissions were insignificant, contributing less than 1 percent of total emissions. In CO2-equivalent, the industry sector has highest emissions with 30 percent; power generation follows with 25 percent, then the commercial and

VIET NAM

Summary: Carbon dioxide contributes a major share of total GHGs


PAGE 41

Fuel type CO2 CH4 N2O NOx CO CO2-equivalent CO2+CH4+N2O

Fugitive 38.09 799.89

Biomass 162.38 1.12 38.59 1,420.84 3,757.18

SECTION 3 ENERGY ASSESSMENT SECTOR

service sector with 18 percent, and other sectors with 13 percent, and transport with 11 percent. Fugitive emissions make up only 3 percent of the total emissions.

FIGURE 3-1 GHGs EMISSIONS FROM

ENERGY SECTOR, FUEL

COMBUSTION AND FUGITIVE

EMISSIONS, EXPRESSED AS CO2- EQUIVALENT

Source: Calculated from 1998 study.

3.2.5 BUSINESS-AS-USUAL SCENARIO

PROJECTION OF THE SECTORAL

GHGs INVENTORY TO 2020

TABLE 3-7 PROJECTION OF ENERGY SECTOR

CO2 EMISSIONS, BAU CASE, KT CO2-EQUIVALENT

FIGURE 3-2 CO2 EMISSIONS BY FUEL TYPE IN

BAU CASE

PAGE 42

This section presents a projection of CO2 emissions to the year 2020 based on a “business as usual” (BAU) scenario, which is defined in section 3.4.2.

GHGs emissions projections to the year 2020 are presented in Table 3- 7 by fuel type. CO2 emissions from fossil fuel in 2020 are projected to increase significantly, reaching 196,976.84 KTCO2 equivalent, or 9 times the emissions in 1994. Combustion of oil products is the largest source of emissions throughout the study period.

Oil products 13,422.30 25,356.19 38,937.15 54,514.06 100,209.66

Coal 8,574.49 16,574.73 29,952.33 38,570.68 74,259.45

Gas 0 3,989.90 8,214.50 12,087.05 22,507.73

Source: Result of this study, 1998.

Source: Calculated from this study, 1998.

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Year 1994 2000 2005 2010 2020

Total 21,996.79 45,920.82 77,103.98 105,171.79 196,976.84

SECTION 3

Although experienced experts from various related institutions and ministries carried out the GHGs Inventory for the energy sector, there are still limitations.

Most of data used in this study came from secondary sources. One of the weaknesses of using these sources is the inability to verify their reliability. This study ignores emissions data that are not available at present, which also reduces the accuracy of the results. Almost all the coefficients used for the inventory were provided by IPCC. Local coefficients are not available, and there are large differences in end-use energy technologies and technical management and practices. Detailed data at the subsectoral level are not available; breakdown of consumption by subsectors has been approximated.

Following the results of the 1993 inventory, GHGs emissions from the energy sector were estimated at 27 mt CO2-equivalent, not including the CO2 emissions from traditional biomass burned for energy. The consumption of energy in the industrial sector accounted for the largest quantities of GHGs gases. Experts from various ministries and institutions carried out the inventory, with experience in energy activities and a good understanding of the IPCC approach. More national technical experts have to be educated in order to be able to crosscheck results. Data used for preparing the inventory are from official government sources. Some corrections were made in the new version of the energy sector GHGs inventory in 1993 based on the updated data submitted by the ministries. Regarding future projections of energy demand, Viet Nam, like many other developing countries, needs to develop its economy; this economic growth will lead to the use of more energy and thus to production of more GHGs emissions. The total projections of energy sector GHGs emissions are estimated at about 340 mt CO2- equivalent to the year 2020. The main limitation of this inventory comes from the use of coefficients. Almost all the coefficients used for preparing the inventory were provided by IPCC. Local coefficients are not available, and there are large differences in end-use energy technologies, and technical management and practices among different areas in Viet Nam. The inventory was carried out for the year 1993 because of the availability of data for that year. For submission to UNFCC, the results should be updated with 1994 data. More time may be needed to verify each crucial figure on site, including emissions in the transport sector. As a result of the experience gained from the implementation of the inventory under the ALGAS Project, Viet Nam plans to conduct a national GHGs inventory first for its initial national communication and thereafter, on an annual basis. The climate change office will be

VIET NAM


3.2.6 LIMITATIONS OF THE GHGs INVENTORY DATA

3.2.7 CONCLUSIONS

PAGE 43

SECTION 3

3.3 SECTOR GHG

3.3.1 INTRODUCTION

ABATEMENT OPTIONS

3.3.2 OVERVIEW OF MITIGATION

OPTIONS

TABLE 3-8 EFFICIENCIES IN THE ENERGY

SECTOR, PERCENT

PAGE 44


strengthened to its full capacity to establish a network for real-time data collection. This office will be responsible for preparing the annual GHGs inventory.

The energy sector in Viet Nam as described above is one of the most important components of the macroeconomic and social development of the country. It has the main priority in the Country Development Plan. The growth rate of energy demand, since 1992, has been on average 14.4 percent, higher than the growth rate of the economic output, and the energy demand in the future will continue to grow at a high rate. It is obvious, that GHGs emissions will increase significantly in the future. At present, the value of GHGs emissions from the energy sector is 22.2 mt CO2-equivalent. It represents 31.5 percent of all national GHGs emissions. Projected GHGs emissions in year 2010 will be 5 times higher and in 2020, 7 to 8 times higher than that in 1993. Thus, measures to mitigate GHGs emissions need to be implemented in the energy sector.

At present, energy production and end-use energy technologies used in Viet Nam are old technologies resulting in a high consumption of energy per unit of output in Viet Nam compared with the OECD countries. Energy consumption compared to European Union (EU) industries are as much as 50 percent higher for thermal uses and 30 percent for electricity uses.

Specific technological efficiency data provided by sectoral studies and surveys are given in Table 3-8. These data show the technological development level of both the energy supply and the end-use energy sectors.

Coal-fired thermal plants 24.0

Oil-fired thermal plants 29.9

Natural gas thermal plants 35.5

Transmission and distribution 79.0

Coal 45.5

Fuelwood 11.0

Fuel oil 45.8

Coal stove 20.0

Fuelwood stoves 12.0

Kerosene stoves 45.0

Source: Institute of Energy, 1995.

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Power sector Efficiencies

Thermal uses in industry

Cooking appliances

SECTION 3

Because of limited sources of data, the mitigation option assessment of the energy sector is limited. Sufficient data on technological costs are not available at present. It has been decided to use the 1995 investment costs of modern technology. These costs may change over time, but in the present assessment the costs are fixed at the 1995 level. The discount rate has been assumed to be 10 percent.

The energy supply and the energy demand sectors in Viet Nam are operating with obsolete technologies. Rehabilitating and replacing these existing technologies are potential measures for saving energy and for reducing the pollution emissions, including GHGs emission.

The mitigation options or measures should satisfy the high-energy demand while reducing the GHGs emissions. The new efficient technologies on the demand side and the fuel switching options on the supply side will be the best options. Following is a list of potentially good mitigation options for the energy sector:

Energy demand side:

(i) Industry sector

Energy efficiency improvement in fuel combustion processes:

Combustion control and monitoring

Promotion of efficiency improvement in production processes:

Efficient lighting system Increasing efficiency of Motor

Improving manual control procedures of energy operation

Heat recovery and cogeneration:

Cogeneration Waste heat recovery from generation

(ii) Transportation sector

Transport system management:

Mass transport systems Pricing policy

Switching to low emission fuels:

Natural gas Electricity

Parking and transportation demand management

Improvement of vehicle efficiency:

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Improvement of energy efficiency of existing transport vehicles by;

Annual fuel efficiency inspection.

Policy and regulation to promote efficient vehicle assembly and purchase;

(iii) Commercial and residential sectors

Energy efficient household equipment:

Promotion of energy efficient residential lighting: High efficiency electric motors for energy saving in the industry sector: High efficiency cooking stoves in rural area: Switching from coal to natural gas for heating purpose:

Energy supply side

(i) Transmission and power generation efficiency improvement

Improvement of existing thermal power plant efficiency: Reduction of losses from grid transmission and distribution: Improvement of oil/ gas/ coal transportation and distribution systems to avoid methane leaks.

(ii) Fuel switching to renewable and lower carbon intensive sources

Natural gas for power generation; Hydroelectric generation; Geothermal power; Nuclear power; Wind power; Solar energy for household use; Biomass.

The most viable mitigation options in the energy sector are as follows:

Demand side options

Energy efficient lighting

Improvement in energy efficiency in fuel combustion processes used in industry Replacement of old low-efficiency boiler by energy-efficient industrial boilers Switching from coal to natural gas for cooking in urban area

Replacement of existing electric motors by highly efficient electric motors; Highly efficient household electric equipment;

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Waste heat recovery

Increased vehicle efficiency (fuel consumption per ton-km or per person-km)

Supply side options

Reduction of transmission and distribution loses in electrical grid Fuel Switching to renewable and less carbon-intensive energy sources (hydropower, natural gas, biomass) Efficiency improvement of fossil fuel power plants

This study used a methodology to identify strategies that satisfy energy demand and at the same time reduces GHGs emissions for the energy sector of Viet Nam. The approach can be described as follows:

First, the Sectoral Energy Environmental Demand Analysis Model (MEDEE/S-ENV) model is used for energy demand forecasting; and Second, based on the projected energy demand, the Energy Flow Optimization Model-Environment (EFOM-ENV) is used as a tool for optimization of the energy resources while minimizing adverse effects to the environment. Evaluation is done within EFOM-ENV taking into consideration the best available technologies and associated fuel shares, for the major energy activities.

The assessment of the energy GHGs mitigation options was carried out by using the MEDEE/S-ENV and EFOM-ENV models. MEDEE/S-ENV was used to project the final energy demand. EFOM-ENV was used to optimize and to calculate primary energy requirements and the related energy production necessary to satisfy a given exogenous demand of final energy. Under this assessment, the energy emissions and cost impacts have been evaluated.

mitigation options were provided by the various institutions worlung on the development of the energy sector. The data on energy consumption and energy intensity were derived from primary sector and end use data. Long-term social economic assumptions are based on projections from the Long Term Strategy Study Institute.

The input data and variables used for the assessment of the energy sector

Energy Demand Forecast-MEDEE/S Model

The MEDEE/S model is a techno-economic model. The model is organized into homogeneous categories or modules, which enables a detailed modeling of energy demand dynamics.

MEDEE/S is made up of a basic model, which is automatically implemented for the 5 energy subsectors, and a series of annex sub-models for calculating environmental details that can be specified. MEDEE/S thus resembles a “model kit”, which each country can adapt through a user-friendly procedure to suit its own socioeconomic characteristics and data availability.

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3.4 ENERGY SECTOR

SCENARIOS TO 2020 3.4.1 APPROACH AND METHODOLOGY

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The procedure used by the model for forecasting energy demand is briefly described below.

The socioeconomic system is divided into subsectors (industry, agriculture, service, transportation, and household) in which the characters of economic activities and energy consumption demand are considered. These subsectors are in turn divided respectively into homogenous groups called modules in which the characteristics of the energy consumption are considered identical among the consumer unit. Thus, one can apply the same structure of evaluation to estimate energy demand of consumer units from the same group. The estimation of energy demand from each module is broken down into two steps:

Estimate the energy demands for satisfying social needs and for conducting the defined production activities (cooking, heating, and lighting). Estimate the final energy demand from the energy consumption by calculating the actual energy consumption based on the type of energy used and power efficiency of equipment. After establishing the structure of evaluation on the energy demand for each module and integrating all the systems of power consumption, the study on the fluctuation of energy demand is made on the basis of varying scenarios.

Structure of the Viet Nam MEDEE/S Model

In the model, the energy consumption system of Viet Nam is separated into five sectors: industry, agriculture, transportation, household and commercial/service. The forecast process is applied to 4 periods 1990-1995, 1995-2000, 2000-2005 and 2010-2020.

Industry Sector:

The industry sector includes six subsectors: food industry, textile- garment, chemicals, metallurgy & engineering, building materials and others. Data of energy consumption was obtained from the Energy Institute and Ministry of Industry (MOI), and data of GDP of each sector was obtained from the statistical yearbook. On the basis of this data (year 1994), the values of electric intensity and fossil fuel intensity of each subsector in the base year was calculated. Viewed from the structure of the overall energy balance, the proportions of energy, by fuel type, used for heating in each industrial subdivision can be estimated.

Household Sector:

The whole sector is divided into two areas: rural and urban. Each area is classified into two categories: household type 1 that has an annual income less than 10 million VND (Vietnamese dong) and household type 2 having annual income higher than 10 million VND. Data on the ratio of these 2

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types of households were obtained from the book “A Survey on the Living Standard of the Vietnamese People” published by State Planning Committee and General Statistics Office. The types of energy consumption studied in this module include cooking, lighting, and hot water. Family electrical appliances studied in detail are television, refrigerator, fan and air conditioner. The structure of energy fuel types used for cooking and lighting as well as the index of family electrical appliances is also extracted from the survey data. The consumption standards are estimated according to the average capacity of the appliances and the numbers of hours used per annum, with reference to standards of the Energy Institute.

Transportation Sector

The research takes the following transportation kinds into account: road, rail, waterway and aviation transport, in which freight transport and passenger transport is differentiated. All the data for the transportation sector are available in the “Statistical Yearbook 1995”. In combination with the data of energy consumption collected from Ministry of Transport and Ministry of Industry, energy-consumption rates for various means of transport were calculated. Data of the proportion of motor vehicles ownership were collected from the survey on the living standard of the Vietnamese people.

Agriculture Sector

The energy consumption level was calculated for the following agriculture sector demands: motor demand, heating demand and electricity demand. The demand for domestic usage of rural areas, however, was determined from the civil-domestic module. Based on the GDP of the agriculture sector and the energy consumption level in the overall energy balance, the values of basic variables for the agriculture sector were calculated. Variables estimated include electricity intensity, energy intensity of fossil fuels and energy intensity of motor fuels.

Commercial/Service Sector

Due to the lack of statistical data, the energy demand was calculated for the whole sector based on the value added that this sector contributed according to the number of employees. The data was derived from the “Statistical Yearbook, 1995”.

Summarized input data for MEDEE/S model

Projecting period 1994, 2000, 2005, 2010, 2020 Number of economic sectors 5 (Industry, Agriculture,

Transportation, Household, Commercial/Service 6 (Food industry, Textile- Garment, Chemicals, Metallurgy & Engineering, Building Materials and others)

Number of sub-industrial sector

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Number of urban area 1 Number of urban households 2 (income over 10 billion VND/

year and below than 10 billion VND/year)

2 (income over 10 billion VND/ year and below than 10 billion VND/year) 4 (Television, Radio-cassette, fan, refrigerator)

Number of rural area 1 Number of rural households

Number of appliance type

Energy Flow Optimization Model-Environment (EFOM-ENV)

The EFOM-ENV model that belongs to the category of medium or long-term energy system optimization modes using quasidynamic linear programming was applied in the study.

In EFOM-ENV, the energy flow begins with primary energy through energy transportation to the final energy demand. Some primary energy forms are converted to intermediate energy forms and then to final energy demand such as hydropower, fossil fuels converted to electricity, etc.

network is modeled as an oriented graph with nodes representing different energy types and likes representing conversion and emission reduction processes in between. The energy conversion and abatement technologies are described according to their technical (conversion efficiencies, installed capacities, by products, etc.), economic (investment, fixed and operating costs) and environmental aspects (emission factors characteristics).

EFOM-ENV is a quasi-dynamic model that calculates the inter-temporal development of the energy system over a planning horizon of several decades. The age structure of existing plants, the dynamics of market penetration and the development of energy demand due to the expected economic development are explicitly taken into account. In the optimization process, various options for energy supply and emission reduction based on given sets of energy technologies, energy carrier etc. are analyzed leading to optimal strategies for energy supply and emission reduction. Therefore, structural changes in the energy systems (e.g. fuel switching technology switching) are not given exogeneously, but are part of the optimal solution calculated by the model.

The EFOM-ENV model is structured in a modular manner in which the real

The main features of the model are:

Explicit representation of energy processes by unidirectional links. Links can be grouped into subsystems representing a sector or a clearly defined group of technological processes. The complete energy system network is presented by a succession of interconnected subsystems from energy reserves until the final consumption (or demand). The energy supply and demand system is presented by an integrated database that relates with the associated network model. This Energy Environment Data Base (EEDB) describes completely the energy system as well as the technical, economic and environment information in all of its parts. Emphasis on technological processes of energy supply and utilization can be explicitly presented by means of a set of

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economic/social/environmental parameters associated with the links representing them. Optimization of the energy system can be carried out in static snapshots or dynamic (multi-period) modes using linear programming. The objective function for optimization is under full control of the user, although the most often used objective function is to minimize the total discounted energy system costs. Analytical representations of the energy generation and utilization activities with seasonal or daily load cycles such as electricity, heat, steam and gas. Environmental issues, that stem from the supply side (i.e. those related to resources extraction, energy transformation, transportation, delivery to the final consumption), can be dealt with. The impacts of policy measures (energy conservation, fuel switching etc.) implemented at the end use level can also be examined by the model. On the other hand, emission reduction measures such as fuel substitution, improvement of fuel quality, energy conservation, efficiency improvements, and emission control technologies can also be assessed with the help of

EFOM-ENV.

EFOM-ENV can provide an optimal primary energy supply mix and can estimate the capacity and investment needed to satisfy the long-term demand at the least cost. The overall discounted costs of the system are minimized which include investments, import expenditure, variable and fixed costs of all process operations of the energy chains, and the costs of emission control technologies.

On the other hand, the described methodology and its use for the elaboration of strategies for energy supply and emission reduction involve several limitations. In a linear programming model, all relations are expressed by linear functions, in spite of the fact that a number of non- linearities exist in the real energy system. A technical example of such non- linearities is the ratio of electricity and heat production of cogeneration power plant. On an economic level the “economies of scale” have to be mentioned leading to specific investment costs decreasing with the capacity installed. Furthermore, integer variables are not considered in the model, so that minimum or standard capacities of plant types cannot be adequately taken into account.

Structure of the Viet Nam EFOM-ENV Model

Model generally distinguishes between different systems. Each system comprises a set of technologies with similar function. In line with the disaggregation used for the Viet Nam 2020 program, the energy supply and demand are represented by systems as follows:

Coal svstem (COAL-SS)

The coal system comprises all conventional activities from the coal extraction with two types of mines such as open pits and deep mines to coal washing for the production of clean coal and then transport to users. The export and import of coal is also included.

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At present, Viet Nam exports coal but the domestic demand for coal will increase rapidly, especially in the power generation sector so that domestic coal production might soon not satisfy demand. For this reason, imported coal is considered in this coal module. The structure of the coal system includes coal for coking and imported coke for industrial demand.

Oil System (OIL-SS)

This system includes all activities from extraction of crude to refining and distribution of oil products to end-users. In Viet Nam, crude oil is low sulfur light oil and there is only offshore extraction. At present, there is no refining, but according to the Viet Nam Petroleum and Gas Corporation, Viet Nam will build oil-refining plants between 2000 and 2020.

Until oil-refining plants are in operation, Viet Nam will have to import all oil products to cover its demands. After year 2000, part of oil products from domestic refineries may be exported. Associated gas is accounted for in the gas system.

Gas System (GAS-SS)

This system covers all gas related activities from natural gas extraction onshore and offshore to end-use, including intermediate processing such as production of liquefied natural gas (LNG), compressed natural gas (CNG) and liquefied petroleum gas (LPG). There is also the potential for Viet Nam to export natural gas by undersea pipeline to Thailand. This project is presently under discussion by the two governments. The associated gas from oil extraction is also included in this system.

Central Electricity System (CENTELEC-SS)

The electricity corporation of Viet Nam (EVN) is managing all the chain from power generation to distribution of the electricity to end-users. On the network side, the two electricity systems considered include (i) Northern system and (ii) Southern system.

In the Northern system, rich in coal reserves, coal-fired thermal plants will be considered. At present, hard coal is the main fuel for all thermal plants. However, in the future lignite will also be considered for use.

generating plants in the southern system. Possible energy sources include offshore natural gas in the south and coal from the north or from other Asian countries. Coal- fired, oil-fired, oil-gas fired and combine cycle power plants will be considered in the future in the Southern sub-system.

There are also hydropower plants in both systems. In addition, the two systems are connected by a high voltage 500 kV transmission line. The activities represented in each sub-system range from power generation, including fossil fuel generation and hydropower generation, to transmission, sub-transmission and distribution of electricity. The export of electricity is considered in both the northern and southern systems.

Fuel supply will be a key determinant in the future for choosing thermal

Traditional Fuel System (TF-SS)

Traditional fuels are mainly used in household sector for cooking. The two main types of traditional fuels are fuelwood and agricultural residues. They are

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SECTION 3

considered in this study as the combined category of biomass. This system considers the fuel chain from extraction of biomass to transport to end-users.

Industrial System (INDUS-SS)

In the industry system, energy demand consists of coal, gas, electricity, fuel oil, motor fuels and other oil products. The electricity demand of the industrial sector is received from the northern and southern electricity system.

The industrial sector is the largest energy consumer now and also in the future. At present, in the industrial production subsector, most of the equipment is outdated. Industrial equipment consumes more energy than the equipment in the developed countries, especially in thermal processes.

Household System (HH-SS)

In order to account properly for the substitution option and conservation measures inside the household system, household demand is split according to end-use application, mainly into three categories: cooking, lighting and other electrical uses. The fuel types considered for cooking are electricity, kerosene, LPG, coal and traditional fuels. The fuel types for lighting are kerosene and electricity. The final electricity needed in this sub-system is received from both the northern and southern system.

Transportation System (TRANSPOR-SS)

The energy forms in transport system are coal, diesel oil, gasoline and jet fuel. At present in Viet Nam, the railway uses coal as fuel for its steam engines. It is expected that this will be replaced by diesel engines by the year 2005.

Agricultural System (AGRICULT-SS)

In the agriculture system, energy demand includes motor fuels and electricity, which is received from northern sub-system and southern subsystem, for specific electricity uses.

Macroeconomic Assumptions

The BAU case is an extension of present trends and assumes that the efficiency of the existing energy system will remain at 1994 levels. It assumes no major change in energy policy. In this case, market forces are crucial in determining energy supply and demand. In the BAU case, the economic development assumed by the Development Strategic Institute, Ministry of Planning and Invest- ment is shown in tables 3.4.2.1 and 3.4.2.2 and forms the basis of the main assumptions stated below. It is estimated that Viet Nam's population will reach 82.1, 88.5, 94.4, and 107 million in 2000, 2005, 2010 and 2020, respectively. The growth rate of investment for the period 1996 to 2000 has been projected at 15 percent. In the period 2001 to 2010 and 2011 to 2020, this figure will increase according to economic targets, quality of life changes, and changes in the use of capital.

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3.4.2 BUSINESS-AS-USUAL (BAU) SCENARIO ASSUMPTIONS

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TABLE 3-9 GDP GROWTH RATE FORECAST

BY SECTOR, 1996-2020, PERCENT

TABLE 3-10 SHARE OF GDP BY SECTOR,

1996-2020, PERCENT

PAGE 54


Income in the non-agriculture sector will increase from 5.5 percent per year during the period 1996 to 2000 to 9 to 10 percent per year in the period after 2000. According to the projection in agriculture sector, the annual average growth rate of the agricultural value-added will reach 4 percent to 4.5 percent during the next 15 years. Industry and construction - The annual average growth rate of the industry and construction sector will reach about 11-14 percent in the period 1996-2010 and 10 percent in the period 2011-2020. It is difficult to measure the growth rate of the service sector in comparison. However, the development of industry and agriculture lead to the development of services. A reasonable annual growth rate of the service sector will range from 8.5 to 10 percent. This is based on an annual growth rate of 44.5 percent in the agriculture sector and 14 percent in the industry sector for the first 10 years followed by 12-13 percent for the period 2010 -2020.

GDP 8.5 7.8 7.0

Value added

Industry + Construction 12.5 10.0 8.0

Agriculture 4.2 4.2 3.0

Service 7.6 7.3 7.1

Development Strategic Institute, Ministry of Planning and Investment, 1998.

Source:

Source: Development Strategic Institute, Ministry of Planning and Investment, 1998.

Final Energy Demand

The final energy demand projections for the BAU case come from the results of the MEDEE/S model. The BAU case assumes that all levels of energy efficiency will remain unchanged from the year 1994. Table 3-11 summarizes the demand- forecast results by sector for the study period.

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Sector 1995 2000 2010 2020

Sector 1996-2000 2001-2010 2011-2020

GDP 100 1000 100 100

The share of value added

Industry + Construction Agriculture

Service

30.0 35.5

28.4 22.5

41.6 42.0

41.5 44.0

15.5 12.1

43.0 43.9


lndustry 2,610.65 5,676.93 10,752.52 16,158.60 32,300.93

Household 1,294.07 2,513.39 3,282.26 4,705.36 7,239.92

Com. & Service 274.50 476.67 674.60 996.60 1,487.72

Transportation 2,081.45 4,046.69 6,164.13 8,525.78 14,252.59

Agriculture 354.40 479.1 3 622.1 1 694.34 91 1.06

Source: Result of MEDEE/S model, 1998.

TABLE 3-11 FORECAST OF FINAL

COMMERCIAL ENERGY DEMAND

IN BAU CASE, KTOE

Industry Sector

Energy demand in the industrial sector is forecast to be 32,000 ktoe in the year 2020, double that in the year 2010. The biggest energy consumption is for diesel oil, reaches 14,000 ktoe in 2020, up from 1,000 ktoe in 1994. The industrial sector has an average annual growth rate of 10 percent in the period 1994-2020. Table 3-12 lists the demand forecast by fuel type in the industrial sector.

TABLE 3-12 COMMERCIAL ENERGY

CONSUMPTION IN INDUSTRIAL Coal 877.81 1,979.70 3,539.35 4,681.76 8,725.83

Diesel oil 1,153.70 2,392.61 4,329.13 6,789.59 14,041.85

Fuel oil 227.21 508.31 916.31 1,215.17 2,303.80

Electricity 351.93 796.31 1,967.73 3,472.08 7229.45


FIGURE 3-3 COMMERCIAL ENERGY

CONSUMPTION IN THE INDUSTRY

SECTOR, 1994-2020


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SECTOR, KTOE

Sector 1994 2000 2005 2010 2020

Total 6,615.07 13,192.81 21,495.62 31,080.68 56,192.22

Fuel type 1994 2000 2005 2010 2020

Total 2,610.65 5,676.93 10,752.52 16,158.60 32,300.93



CONSUMPTION IN THE

HOUSEHOLD SECTOR, KTOE


CONSUMPTION IN THE

HOUSEHOLD SECTOR, 1994- 2020


CONSUMPTION IN THE

COMMERCIAL & SERVICE

SECTOR, KTOE

PAGE 56

Household Sector

The average annual growth rate of energy consumption in the household sector is about 7 percent between 1994 and 2020. The total energy demand increases rapidly from 1,294 ktoe in 1994 to 7,240 ktoe in 2020; within that total electricity demand has the highest growth rate at 9 percent per annum. Table 3-13 shows energy consumption in the household sector.

Coal 792.46 1,450.79 1,603.21 2,053.95 2,644.73

Kerosene 237.58 453.31 584.15 849.29 1,404.58

LPG 0.00 22.76 86.25 238.30 683.68

Electricity 264.03 586.53 1,008.65 1,563.82 2,506.93



Commercial and Service Sector

Energy demand in the commercial and service sector is expected to be 1,488 ktoe in 2020, rising from 275 ktoe in 1994 with an average annual growth rate of 6.7 percent. Coal consumption dominates in this sector at more than 50 percent throughout the forecast period.

Coal 146.06 257.42 365.1 6 539.1 7 795.1 3

Fuel oil 64.26 11 3.26 160.65 237.22 349.83

Electricity 64.1 8 105.99 148.79 220.21 342.76


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Fuel Type 1994 2000 2005 2010 2020

Total 1,294.07 2,513.39 3,282.26 4,705.36 7,239.92

Fuel Type 1994 2000 2005 2010 2020

Total 274.50 476.67 674.60 996.60 1,487.72



Transportation Sector

Energy consumption in the transportation sector is shown in Table 3-15. It increases from 2,000 ktoe in 1994 to 14,000 ktoe in 2020, with an annual growth rate of 7.6 percent. Coal consumption is minor and decreases to 0 in 2005 from 9.6 ktoe in 1994. Gasoline and diesel oil are the two dominant fuels in total energy consumption in this sector; each accounts for about 40 percent of total consumption.

Coal 9.60 7.83 0.00 0.00 0.00

Gasoline 1,032.39 2,176.69 3,221.42 4,309.48 6,700.87

Diesel oil 792.65 1,459.51 2,382.13 3,400.22 6,031.94

Fuel oil 55.20 90.06 128.25 186.71 346.88

Jet fuel 191.61 312.60 432.33 629.37 1,172.90



CONSUMPTION IN THE

SECTOR, 1994-2020 COMMERCIAL & SERVICE


CONSUMPTION IN THE

TRANSPORTATION SECTOR, KTOE


CONSUMPTION IN THE TRANSPORT

SECTOR, 1994-2020


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Fuel Type 1994 2000 2005 2010 2020

Total 2,081.45 4,046.69 6,164.13 8,525.78 14,252.59



CONSUMPTION IN THE

AGRICULTURE SECTOR, KTOE


CONSUMPTION IN THE

AGRICULTURE SECTOR, 1994- 2020

PAGE 58

Agricultural Sector

Total energy consumption in the agricultural sector will reach 911 ktoe in 2020, rising from 354 ktoe in 1994 with a low annual growth rate of 3.6 percent. Diesel is most important fuel in this sector with a share of more than 56 percent during the forecast period. Electricity follows with a share of about 32 percent.

Coal 3.67 4.75 6.06 6.63 9.09

Diesel oil 208.24 282.66 361.94 399.01 515.03

Fuel oil 26.10 33.74 43.04 47.12 64.56

Electricity 116.39 157.98 211.07 241.58 322.38

Total 354.40 479.13 622.11 694.34 911.06



Energy Supply Assumptions

The main principle of the strategy for reducing pollution emissions on the supply side is to reduce fossil fuel usage by improving energy efficiency, substituting fossil fuels by non-fossil fuels, and replacing with high-carbon- content fuels with low-carbon-content. Viet Nam’s energy development is summarized as follows:

In construction of future thermal power plants, priority should be given to the development of larger units with higher efficiency than current plants. In the future, transmission and distribution networks should be rehabilitated. A standard medium voltage level of 22 kV should be used for reducing transmission and distribution losses. It is assumed that oil refinery plants will be constructed and operated by 2000 mainly for the domestic market. Oil products are

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Fuel Type 1994 2000 2005 2010 2020

SECTION 3

considered only while there will be surplus over the domestic demand.

BASE Case Assumptions

(i) Macroeconomic Assumptions

Hypotheses regarding population growth, and GDP growth and structure are the same as in the BAU case.

(ii) Mitigation options in Supply Sectors

Fuel Switching in Power Generation

This emissions abatement option involves fuel switching in the power generation sector. In the north, existing coal-fired power plants are substituted by oil-fired power plants; in the south, existing oil-fired power plants are substituted by gas-fired thermal power plants.

The capacity of existing coal-fired power plants to be converted to oil use is 640 MW in the period 2000 to 2005. The investment requirement is estimated to be about $150/kW. The capacity of existing oil-fired power plants to be converted to gas use is 198 MW in the period 2000 to 2005. The investment requirement is estimated to be about $l00/kW.

Wind Turbine

The technical viability of operating wind energy systems depends on the available wind velocity and duration. Viet Nam, particularly the central region, is in a high wind-velocity area. However, wind energy use is still very limited, and is used mainly in remote areas. Some foreign companies have proposed new wind farms for Viet Nam. The Ventis Company conducted a feasibility study for the construction of a wind farm with a capacity of 10MW in a first phase and 20MW at the end of the second phase in Nha Trang city, in southern Viet Nam. The first phase is expected to be in operation by year 2000, and the second phase is expected to start operation in 2005.

installed wind power capacity is as follows: This study considers wind power growth starting in the 2000, and the

2000: 10MW 2005: 20MW 2010: 40MW 2020: 100MW

Mitigation Options in Demand Sectors

The final energy demand of the BASE case assumes efficiency improvements in the industrial sector, in coal cooking stoves, and in household electric appliances.

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Efficiency Improvements in Cooking

Energy for cooking in Viet Nam is dominated by biomass fuels. In rural areas, fuelwood is used for cooking. Some kerosene is also used. Coal, either in lump form or as briquettes, is widely used. The share of electricity for cooking is very small.

The change from burning lump coal in homemade stoves to burn briquettes in innovative stoves leads to an efficiency increase from 17 percent to 25 percent. The cost of efficiency improvements in a cooking stove is estimated to be $50/ktoe saved. Penetration rates of this efficiency improvement in milestone years are assumed as follows:

2000 2005 2010 2020

Rural households, percent 5 10 15 20

Urban households, percent 10 15 20 30

Compact Fluorescent Lamps (CFLs)

Lighting in Viet Nam is currently provided predominantly by mercury vapor lamps. Fluorescent lighting is rarely used, and incandescent lighting is used in outlying areas. There is a large potential for application of CFLs in Viet Nam. This option entails installation of CFLs in place of existing lamps. The schedule for this substitution is as follows:

2005 2010 2020

Rural households, percent 0 3 5

Urban households, percent 10 15 20

Characteristics of incandescent bulbs currently in use and CFLs can be described as follows:

Bulb CFL

Nominal power capacity, W 75 14

Lifetime, hours 1,000 8,000

Capital cost, $ 0.5 20

Annual consumption, kWh 109.5 23

Based on these figures, cost of substituting CFLs by bulbs is estimated to be $31/MWh saved.

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High-Efficiency Refrigerators

The Institute of Energy, through surveys carried out by Market Research of the Energy Institute, estimated that refrigerators in Viet Nam represents about 3 percent of residential peak demand in the winter and 5 percent in the summer. However, this market is growing very rapidly.

Estimated power consumption of refrigerators range from 100W to 135W. In this study, the figures and characteristics were taken from a World Bank demand-side management analysis. They are related to 150-liter refrigerators with a 120-W capacity. The compressor operates an average of 14 hours per day, resulting in an annual electricity consumption of 613 kWh. This emissions reduction option assumes that existing standard refrigerators will be replaced with efficient ones. Characteristics of both standard and efficient refrigerators are listed below:

Standard Efficient

Nominal power capacity, W 120 102

Lifetime, years 8 8

Capital cost, $ 350 385

Annual consumption, kWh 613 521

Source: Demand-Side Management Study Report, World Bank (1996).

The schedule for substitution is as follows:

2005 2010 2020



Based on the above figures, the cost of substituting efficient refrigerators for standard ones is estimated to be $63/MWh.

Air Conditioning

At present, electricity consumption for air conditioning in Viet Nam is estimated (in the World Bank DSM Analysis Report) to be 3 percent of total electric consumption. This share will be higher in the future due to the construction of new modern buildings and improved living standards. This study considers replacement of existing air conditioners (from the former Soviet Union) with more efficient ones. Average annual electricity consumption of existing air conditioner is estimated at 1,987 kWh per year. With efficient air conditioners, electricity consumption is expected to be reduced by 22 percent. The characteristics of the two models of air conditioners are below:

VIET NAM


PAGE 61

SECTION 3

PAGE 62


Standard Efficient

Lifetime, years 10 10

Capital cost, $ 25

Annual consumption, kWh 1,987 1,548

The schedule for substitution is as follows:

2005 2010 2020



The cost for substituting efficient air conditioner by efficient air conditioners for standard one is estimated to be $9/MWh.

More Efficient Industrial Motors

Establishment of an electric motor efficiency standard would capture opportunities that would otherwise be lost during the intense industrial growth period that is expected in Viet Nam. Highly efficient electric motors are available from the majority of large electric motor manufacturers in industrialized countries.

This emission reduction option considers savings improvement based on a 15-kW motor, which is the average motor size in the 0.75 to 150 kW motor range. For this average size, a 5 percent efficiency improvement based on an 86 percent standard efficiency motor results in energy savings of 6.4 percent. The energy consumption and incremental cost are shown below:

Standard Efficient

Nominal power capacity, kW 15 15

Motor efficiency, percent 86 91

Lifetime, years 20 20

Incremental cost, $ 225

Annual consumption, kWh 61,047 57,692

Source: Demand Side Management Study Report, World Bank (1996).

Cost for substituting efficient electric motors for existing ones is estimated to be $8/MWh. The shares of efficient electric motors in milestone years are as follows:

VIET NAM

SECTION 3

2005 2010 2020

Share of Efficient Electric Motors, percent 5 10 15

The Abatement Case Approach

a. First Approach

The first approach involves setting CO2 emissions constraints at the end of the study period, i.e. in 2020. Different levels of CO2 emissions reduction are considered. The least-cost solution will indicate energy supply technologies that meet the final energy demand and CO2 emissions constraints at the same time.

This approach defines potential CO2 emissions reduction in 2020 to 5 percent, 10 percent, or 15 percent compared to base emissions.

b. Second Approach

This approach limits CO2 emissions at the same levels as the first approach but according to a yearly growth rate during the study (2005 and 2020) compared to CO2 emissions in the Base case. Growth rates for CO2 emissions are 0.5 percent, 1 percent, and 1.1 percent per annum.

Final energy demand for the study period was given in section 3.4.2. Final energy demand input for optimization of the energy supply system (from EFOM-ENV) is summarized in Table 3-17.

Primary Energy supply

Figure 3-9 shows the development of the primary energy supply in Viet Nam in the BAU scenario. As a result of increase in energy demand, total primary energy supply in 2020 will be about 6.1 times as high as demand in 1990. This corresponds to an average annual growth rate of about 7.2 percent.

Domestic coal production will increase gradually with an average growth rate of 8.5 percent in this study period resulting from increased industrial and power generation demands. However, the share of coal production will decrease from 27 percent in 1994 to 14 percent in 2020. The annual average growth rate will be about 4.6 percent during the study.

Transport 2,081.45 4,046.69 6,164.13 8,525.78 14,252.59

Agricultural 354.40 479.13 622.1 1 694.34 91 1.06

Household 5,554.61 6,535.34 7,071.60 7,842.10 9,889.20

Commercial 274.50 476.67 674.60 996.60 1,487.72

Industry 2,610.65 5,676.93 10,752.52 16,158.60 32,300.93

Source: Calculated from this study by MDEE/S Model (includes traditional energy)

VIET NAM


3.4.3 BUSINESS-AS-USUAL SCENARIO

RESULTS: THE BAU CASE

TABLE 3-17 TOTAL FINAL ENERGY DEMAND

IN THE BAU CASE, KTOE

PAGE 63

Sector 1994 2000 2005 2010 2020

Total 10,875.61 17,214.76 25,248.96 34,217.42 58,841.50


FIGURE 3-8 FINAL ENERGY DEMAND IN THE

BAU CASE

Source: Calculated from this study by MEDEE/S Model.

Natural gas penetrated the market in 1995 and will increase until 2020 as it is used for power generation. The share of natural gas will increase to about 11.9 percent in 2020 from 7.8 percent in 1995. In terms of absolute value, natural gas increases from 1,700 ktoe in 2000 to 9,590 ktoe at the end of the study period; i.e., the average growth rate is about 9 percent per year. Development of hydropower has also been promoted. Hydropower supply has increased in recent years and continues to grow during the study period at an average of 7.4 percent per year until it reaches 13,650 ktoe.

In order to meet the high-energy demand, nuclear power plants will be constructed in 2020. However, the share of nuclear power will still be small at 5 percent in relation to total primary energy supply. Geothermal and wind power will be used for power generation, but their share in total primary energy is small.

TABLE 3-18 PRIMARY ENERGY SUPPLY IN

THE BAU CASE, KTOE

PAGE 64

Coal 2,130 4,101 7,245 9,258 17,851

Petroleum 4,599 8,995 13,544 18,758 34,241

Gas 36 1,700 3,500 5,150 9,590

Electricity 0 0 0 0 1,352

New & renew. 2,129 2,845 5,415 10,743 14,311

Traditional 4,186 4,027 3,797 3,144 2,658

Source: Calculated from this study by EFOM-ENV Model.

VIET NAM

1994 2000 2005 2010 2020

Total 13,080 21,667 33,501 47,053 80,003


Coal 16.33 18.93 21.63 19.68 22.31

Petroleum 35.26 41.52 40.43 39.86 42.8

Gas 0.00 7.85 10.45 10.95 11.99

Electricity 0.00 0.00 0.00 0.00 1.69

New & renew. 16.32 13.1 3 16.16 22.83 17.89

Traditional 32.09 18.58 11.33 6.68 3.32


Source: Calculated from this study by EFOM-ENVModel.

Power Generation

Because of high electricity demand growth, power generation is expected to rise drastically. Electricity production in 2020 will be more than 13 times than that in 1994. This corresponds to an average growth of 11 percent per year during the study. Electricity production reaches 152 TWh in 2020 up from 11 TWh in 1994. Electricity production by hydropower plants dominates accounting for about 50 percent of this total during the study period. Figure 3-10 illustrates electricity production by fuel types in milestone years.

power industry is gas fueled combined cycle plants. Electricity generated from this technology will account for 36 percent of total electricity generation from thermal power in 2020.

As a least-cost option, the technology selected for expansion of the

VIET NAM

TABLE 3-19 PERCENT SHARES OF PRIMARY

ENERGY SUPPLY IN THE BAU CASE

FIGURE 3-9 PRIMARY ENERGY SUPPLY IN THE

BAU CASE

PAGE 65

Year 1995 2000 2005 2010 2020

Total 100.00 100.00 100.00 100.00 100.00


TABLE 3-20 ELECTRICITY PRODUCTION IN

THE BAU CASE, IN GWH Coal 958 1,286 5,972 6,991 22,120

Gas 233 11,067 20,372 29,023 55,302

Diesel 52 0 0 0 0

Fuel oil 1,644 0 1,763 1,763 713

Hydro 8,503 11,358 21,650 42,733 54,535

Nuclear 0 0 0 0 2,908

Wind 0 0 0 215 431

Biomass 0 42 84 105 105

Geothermal 0 0 0 345 689

Import 0 0 0 0 15,724

Total 11,390 23,753 49,841 81,175 152,527


TABLE 3-21 PERCENT SHARE OF ELECTRICITY

PRODUCTION IN THE BAU CASE Coal 8.41 5.41 11.98 8.62 14.50

Gas 2.04 46.59 40.87 35.75 36.26

Diesel 0.46 0.00 0.00 0.00 0.00

Fuel oil 14.44 0.00 3.54 2.17 0.47

Hydro 74.66 47.81 43.44 52.64 35.75

Nuclear 0.00 0.00 0.00 0.00 1.91

Wind 0.00 0.00 0.00 0.26 0.28

Biomass 0.00 0.19 0.17 0.13 0.07

Geothermal 0.00 0.00 0.00 0.43 0.45

Import 0.00 0.00 0.00 0.00 10.31

Total 100.00 100.00 100.00 100.00 100.00


During the study period, fuel input for electricity generation will increase from 3,072 ktoe in 1994 to 29,705 ktoe in 2020. (Table 3-22, Fig 3-11)

Hydropower dominates power generation during the study period. The share of hydropower in the total fuel input for electricity production is at its maximum at 69 percent in 1994, and then decreases to 46 percent in 2020. It is clear that natural gas is the preferable fuel for power generation in the least-cost solution. The share of natural-gas-based electricity in total electricity production ranges from 29 percent to 32 percent, growing at an annual rate of 10.5 percent.

PAGE 66 VIET NAM

Year 1994 2000 2005 2010 2020

Year 1994 2000 2005 2010 2020


FIGURE 3-10 ELECTRICITY PRODUCTION IN

THE BAU CASE

By contrast, the contribution of oil products will decrease in the fuel mix for electricity production in the year 2000. Replacement of oil will be largely a result of increased use of natural gas and hydropower for electricity generation. Figure 3-13 shows the fuel mix in electricity production in the BAU case.

Table 3-23 illustrates the power generation by technologies in a least cost option. It is clear that electricity generation will come mainly from hydropower, which accounts for 74.6 percent of total electricity generation in 1994 and 39.8 percent in 2020. In 2020, more than 40 percent of total electricity generation will come from gas combined cycle. The coal-fired power plants share of electricity generation will be about 16 percent in 2020. The shares of other new and renewable energy technologies, such as wind power, geothermal power, and biomass, will still be small in the least-cost power supply mix,

VIET NAM PAGE 67

SECTION 3

TABLE 3-22 ENERGY INPUT FOR ELECTRICITY

PRODUCTION IN THE BAU CASE, KTOE

FIGURE 3-11 ENERGY INPUT FOR ELECTRICITY

PRODUCTION IN THE BAU CASE

TABLE 3-23 POWER GENERATION BY

TECHNOLOGIES IN THE BAU CASE, IN GWH

PAGE 68


Coal 305.10 409.70 1,744.00 1,995.00 5,713.00

Gas 35.79 1,700.00 3,500.00 5,150.00 9,590.00

Oil products 602.80 800.00 551.60 151.60 61.36

Hydropower 2,128.57 2,844.86 5,414.86 10,694.29 13,648.57

Nuclear 0.00 0.00 0.00 0.00 564.22

Biomass 0.00 12.04 24.08 30.10 30.10

Wind 0.00 0.00 0.00 18.80 37.60

Geothermal 0.00 0.00 0.00 30.08 60.16

Total 3,072.26 5,766.60 11,234.54 18,069.87 29,705.01

Source: Calculation from this study by EFOM-ENV Model.


Coal-fired 958 1,286 5,972 6,991 22,120

Gas-turbine 233 3,779 2,616 1,163 581

Oil-fired 1,644 0 1,763 1,763 71 3

Diesel 52 0 0 0 0

Gas-Combined Cycle 0 7,288 17,756 27,860 54,721

Nuclear 0 0 0 0 2,908

Hydropower 8,503 11,358 21,650 42,733 54,535

Biomass 0.00 42 84 105 105

Geothermal 0 0 0 345 689

Wind 0 0 0 215 431

Total 11,390 23,753 49,841 81,175 136,698


VIET NAM

Year 1994 2000 2005 2010 2020

Year 1994 2000 2005 2010 2020

SECTION 3


CO2 Emissions

CO2 emissions will increase rapidly in the future mainly because of growth of primary energy consumption and increasing use of coal. Total CO2 emissions are projected to increase from 22 mt per annum in 1994 to 197 mt per annum at the end of study period. This corresponds to an average growth rate of 8.8 percent per year in the BAU case.

Table 3-25 illustrates CO2 emissions by sectors. The contribution of industry to total CO2 emissions is largest in the BAU case. The share of CO2

emissions from industry is projected to increase from about 36 percent in 1994 to 44 percent in 2020; while the share of the tertiary sector will drop from about 20 percent in 1994 to 9 percent in 2020 in the BAU case in the study period. The share of CO2 emissions from the power sector ranges between 10 percent and 20 percent in the BAU case.

declines slightly from 28 percent to 22 percent over the period 1994 to 2020 in the BAU case. The agriculture sector will continue playing very small role in the total CO2 emissions due to its very small share in the total final energy demand.

The percent contribution of transport sector to the total CO2 emissions

Agricultural 249 335 429 472 615

Industrial 7,918 17,196 30,923 44,211 86,814

Power generation 3,192 8,154 17,116 20,781 46,198

Other energy 0 5 465 896 1,391

Tertiary 4,430 8,164 9,739 13,288 19,200

Transport 6,208 12,065 18,431 25,523 42,759


VIET NAM


TABLE 3-24 CO2 EMISSIONS IN THE BAU CASE, KT CO2-EQULVALENT

PAGE 69

Year 1994 2000 2005 2010 2020

Total 21,997 45,920 77,104 105,172 196,997

FIGURE 3-12 POWER GENERATION BY

TECHNOLOGIES IN THE BAU CASE

SECTION 3

TABLE 3-25 PERCENT SHARE OF CO2

EMISSIONS BY SECTOR IN THE

BAU CASE


Agricultural 1.13 0.73 0.56 0.45 0.31

Industrial 36.00 37.45 40.11 42.04 44.07

Power generation 14.51 17.76 22.20 19.76 23.45

Other energy 0.00 0.01 0.60 0.85 0.71

Tertiary 20.14 17.78 12.63 12.63 9.75

Transport 28.22 26.27 23.9 24.27 21.71

Total 100.00 100.00 100.00 100.00 100.00

Source: Calculation from this study by EFOM-ENV Model.

FIGURE 3-13 CO2 EMISSIONS IN THE BAU CASE


Other Pollutant Emissions

Figures 3-14 and Figure 3-15 show the emissions of NOx and SO2between 1994 and 2020 in the BAU case. The results in the BAU case (1994- 2020) show that total SO2 emissions will increase to about 12 percent per annum, and total NOx emissions in the year 2020 will increase by 3.56 times compared to emissions in 1994.

TABLE 3-26 NOx EMISSIONS BY SECTOR IN

THE BAU CASE, KT Agricultural 292.77 391.92 501.47 551.69 724.21

Industrial 26.11 56.85 102.19 145.41 284.61


Other energy

Tertiary 14.71 26.83 31.15 41.26 55.51

Transport 15.58 28.98 46.31 65.63 114.97

Total 358.89 520.09 715.86 840.29 1,275.03


PAGE 70 VIET NAM

Year 1994 2000 2005 2010 2020

Year 1994 2000 2005 2010 2020


FIGURE 3-14 NOx EMISSIONS IN THE BAU CASE

Agricultural 2.29 3.09 3.95 4.36 5.66

Industrial 41.49 91.63 164.7 226.56 435.86


Other energy

Tertiary 19.70 35.95 41.74 55.29 74.40

Transport 14.97 27.56 41.88 58.91 101.95


TABLE 3-27 SO2 EMISSION, BY SECTORS IN

THE BAU CASE, KT

The BASE case

Final Energy Demand

The energy demand is reduced by 5 percent in comparison with the BAU scenario. The total final energy demand in the Base case is indicated in Table 3-28. Table 3-28 indicates that the total final energy demand in 2020

VIET NAM

FIGURE 3-15 SO2 EMISSIONS IN THE BAU CASE

3.4.4 MITIGATION SCENARIO

RESULTS

PAGE 71

Year 1994 2000 2005 2010 2020

Total 120.68 172.88 301.08 395.8 736.75


would be 5.1 times as high as in 1994, i.e., average annual growth rate is about 6.5 percent. This table shows the final energy demand by sectors.

TABLE 3-28 FINAL ENERGY DEMAND IN THE

BASE CASE, KTOE Transport 2,081.45 4,046.69 6,164.13 8,525.77 14,252.59

Agricultural 354.40 479.13 622.11 694.34 911.06

Household 5,554.61 2,733.32 3,556.47 4,830.69 7,330.69

Commercial 274.48 476.67 674.59 996.62 1,487.72

Industrial 2,610.65 5,642.93 10,648.62 15,962.53 31,844.13

Source: Results of Optimization 1998 (include traditional energy).

FIGURE 3-16 FINAL ENERGY DEMAND IN THE

BASE CASE

Primary Energy Supply

Figure 3-17 shows the development of the primary energy supply in Viet Nam in the BASE scenario. As a result of the increase of the energy demand, the total primary energy supply in 2020 would be about 5.9 times higher than that in 1994. This corresponds to an average annual growth rate of about 7.1 percent.

Petroleum will be the most important primary energy source for Viet Nam during the projected period. Its share in total primary energy supply increases from 35.1 percent in 1994 to 43.9 percent in 2020.

ktoe in 2020, almost 7.4 times the 1994 level, corresponding to an average annual growth rate of 8 percent from 1994 to 2020. The share of primary coal consumption will be irregular. It is at a maximum at about 20.2 percent at the end of the study period after being down to 16.6 percent in 2010 from 18.9 percent in 2005.

The total supply of coal will increase from 2,130 ktoe in 1994 to 15,812

PAGE 72 VIET NAM

1994 2000 2005 2010 2020

Total 10,875.59 13,378.74 21,665.92 31,009.95 55,826.19


Coal 2,130.00 3,211.00 6,141.00 7,532.00 15,812.00

Petroleum 4,599.00 8,995.00 13,544.00 18,757.00 34,240.00

Gas 36.00 1,700.00 3,500.00 5,150.00 9,590.00

Electricity import 0.00 0.00 0.00 0.00 1,352.00

New & renewable 2,128.00 2,844.00 5,414.00 10,743.00 14,310.00

Traditional 4,186.00 4,026.00 3,797.00 3,144.00 2,658.00


Coal 16.29 15.46 18.96 16.62 20.28

Petroleum 35.16 43.30 41.81 41.38 43.92

Gas 0.28 8.18 10.80 11.36 12.30

Electricity import 0.00 0.00 0.00 0.00 1.73

New & renewable 16.27 13.68 16.71 23.70 18.36

Traditional 32.00 19.38 11.72 6.94 3.41



Natural gas penetrates the market mainly from 2000 and will increase drastically in the period 2000-2020 due to the introduction of gas into power generation. The share of natural gas will increase to about 12.3 percent in 2020 from 8.18 percent in 2000. In absolute value terms, natural gas would increase from 1,700 ktoe in 2000 to 9,590 ktoe in the BASE scenario at the end of study period, i.e., average growth rate will be about 9 percent per year.

VIET NAM

TABLE 3-29 PRIMARY ENERGY SUPPLY IN THE

BASE CASE, KTOE

TABLE 3-30 SHARE OF ENERGY SUPPLY IN THE

BASE CASE BY TYPE OF FUEL,

PERCENT

FIGURE 3-17 PRIMARY ENERGY SUPPLY IN THE

BASE CASE

PAGE 73

Year 1994 2000 2005 2010 2020

Total 13,079.00 20,776.00 32,396.00 45,326.00 77,962.00

Year 1994 2000 2005 2010 2020

Total 100.00 100.00 100.00 100.00 100.00


The development of hydropower production would also be promoted. The supply of hydropower has increased in recent years and will continue to increase in the study period at 8.5 percent per year of average growth rate and will reach 13,648 ktoe in the BASE scenario in 2020 (Table 3-33). However, the share of hydropower will be the range of 18-23 percent in the primary energy supply during the study period. In 2020, in order to meet the high-energy demand, nuclear power plants will be constructed. However the share of nuclear power would be still small in total primary energy supply, with about 5 percent in 2020.

but their share in total primary energy is still small.

Power Generation

Geothermal power and wind power will be used for power generation

Due to the high growth rate of electricity demand, power generation is expected to rise drastically. The electricity production in 2020 would be more 11.2 times than that in 1994. The electricity production reaches 11,706 GWh in 1994 and up to 131,251 GWh in 2020.

Table 3-31 illustrates the power generation by technologies at a least cost option. It is clearly that electricity generation will mainly from hydropower, accounting for 74 percent in 1994 and 42 percent in 2020 in total electricity generation. In 2020, more than 41 percent of total electricity generation will come from natural gas combine cycle power plants. The share of electricity generation of coal fired power plants will increase to about 14 percent in 2020 compared to 4.1 percent in 2010. The other new and renewable energy technologies such as wind power, geothermal power and biomass are included in the least cost power supply mix which is expected to provide a small share of the power. Hydropower is the most favorable primary energy for power generation until 2020.

TABLE 3-31 POWER GENERATION BY

TECHNOLOGIES IN THE BASE

CASE, GWH

PAGE 74

Coal-fired 957.91 673.26 3,805.00 3,270.00 18,445.00

Gas-turbine 232.56 3,779.07 2,616.28 1,162.79 581.4

OiI-fired 1,644.19 0.00 1,762.79 1,762.79 71 3.49

Diesel 208.14 0.00 0.00 0.00 0.00

Gas-CC 0.00 7,258.37 17,755.81 27,860.46 54,720.93

Nuclear 0.00 0.00 0.00 0.00 0.00

Hydropower 8,663.29 11,577.45 21,551.92 43,529.78 55,548.46

Biomass 0.00 41.98 83.95 104.93 104.93

Geothermal 0.00 0.00 0.00 349.78 699.56

Wind 0.00 0.00 0.00 218.63 437.26


VIET NAM

Year 1994 2000 2005 2010 2020

Total 11,706.09 23,330.13 47,575.75 78,259.16 131,251.03



Coal-fired 8.1 8 2.89 8.00 4.19 14.05

Gas-turbine 1.99 16.20 5.50 1.49 0.44

Oil-fire 14.04 0.00 3.70 2.25 0.55

Diesel 1.79 0.00 0.00 0.00 0.00

Gas-CC 0.00 31.11 37.32 35.60 41.69

Nuclear 0.00 0.00 0.00 0.00 0.00

Hydro 74.00 49.62 45.30 55.62 42.33

Biomass 0.00 0.1 8 0.18 0.1 3 0.08

Geothermal 0.00 0.00 0.00 0.45 0.53

Wind 0.00 0.00 0.00 0.27 0.33

Hydropower is the most favorable primary energy for power generation until 2020. However, the share of hydropower in total energy input for production of electricity reaches a maximum at 69.3 percent in 1994 and then declines to 45.9 percent in 2020. Natural gas for power generation increases with an annual average growth rate at 9 percent in the period 2000-2020. The share of coal increased drastically from approximately in 9.9 percent 1994 to 19.2 percent in 2020. The substitution of oil in year 2000 is mainly due to an increased use of natural gas and hydropower for electricity generation (Tables 3-33 and 3-37).

VIET NAM

FIGURE 3-18 POWER GENERATION BY

TECHNOLOGIES IN THE BASE

CASE

TABLE 3-32 SHARE OF POWER GENERATION

BY TECHNOLOGIES IN THE

BASE CASE, PERCENT

PAGE 75

Year 1994 2000 2005 2010 2020

Total 100.00 100.00 100.00 100.00 100.00

SECTION 3

ENERGY INPUT FOR POWER

GENERATION IN THE BASE CASE, KTOE

TABLE 3-34 SHARE OF ENERGY INPUT FOR

POWER GENERATION IN THE

BASE CASE, PERCENT


305.10 214.40 1,666.00 1,807.00 5,712.00

35.79 1,700.00 3,500.00 5,150.00 9,590.00 Gas

Oil 602.80 800.00 551.60 151.60 61.36

Hydropower 2,128.57 2,844.86 5,295.43 10,694.29 13,648.57

Nuclear power 0.00 0.00 0.00 0.00 566.67

Biomass 0.00 12.04 24.08 30.10 30.10

Wind power 0.00 0.00 0.00 18.8 37.6

Geothermal 0.00 0.00 0.00 30.08 60.16

Coal 9.93 3.85 15.09 10.11 19.23

Gas 1.16 30.51 31.71 28.80 32.28

Oil 19.62 14.36 5.00 0.84 0.21

PAGE 76 VIET NAM

Coal

Year 1994 2000 2005 2010 2020

Total 3,072.26 5,571.30 11,037.11 17,881.87 29,706.46

Year 1994 2000 2005 2010 2020

Hydropower

Nuclear Power

Biomass

Wind power

69.28 51.06 47.98 59.80 45.94

0.00 0.00 0.00 0.00 1.91

0.00 0.22 0.22 0.17 0.10

0.00 0.00 0.00 0.11 0.13

Geothermal 0.00 0.00 0.00 0.17 0.20

Total 100.00 100.00 100.00 100.00 100.00

CO2 Emissions

Due to the expected rapid growth of the primary energy consumption and the increasing use of domestic coal, the CO2 emissions will increase rapidly in the future. The total CO2 emissions are projected to increase from 22 mt in 1994 to 189 mt CO2- equivalent at the end of study period. This corresponds to an average growth rate of 8.6 percent per year (Table 3-35 and Figure 3-20). However, the CO2 emissios will be expected to reduce compared to the BAU case. The reduction ranges from 4.3 percent in 2020 to 8.3 percent in 2000.

TABLE 3-33





Agricultural 248 335 428 472 61 5

Industrial 7,918 17,121 30,664 43,700 85,547

Power generation 3,192 7,350 16,795 20,008 46,194

Other energy 0 0 325 689 1,391

Tertiary 4430 6,327 7,708 10,684 15,851

Transport 6,207 12,065 18,431 25,523 42,758


VIET NAM

FIGURE 3-19 ENERGY INPUT FOR POWER

GENERATION BY FUEL TYPE IN

BASE CASE

TABLE 3-35 CO2 EMISSIONS BY SECTOR IN

THE BASE CASE, KT CO2-

EQUIVALENT

PAGE 77

Year 1994 2000 2005 2010 2020

Total 21,996 42,147 72,391 97,769 188,649


FIGURE 3-20 CO2 EMISSIONS BY SECTORS IN

BASE CASE


Other Pollutants Emissions

Figures 3-21 and 3-22 show the emissions of NOx and SO2 between 1994 and 2020 in the BASE case.

TABLE 3-36 NOx EMISSIONS BY SECTORS IN

THE BASE CASE, KT NOx

FIGURE 3-21 NOx EMISSION BY SECTORS IN

BASE CASE

PAGE 78

Agricultural 292.77 391.92 501.47 551.69 724.21

Industrial 26.1 1 56.59 101.26 143.58 280.08


Other energy

Tertiary 14.71 19.87 23.45 31.39 42.82

Transport 15.58 28.98 46.31 65.63 114.97



VIET NAM

1994 2000 2005 2010 2020

Total 358.89 509.95 706.06 825.77 1,257.79


Agricultural 2.29 3.09 3.95 4.36 5.66

Industrial 41.49 91.20 163.21 223.64 428.54


Other energy

Tertiary 19.7 26.67 31.48 42.13 57.48

Transport 14.97 27.56 41.88 58.91 101.95

Source: Calculated from this study by EROM-ENV Model.

TABLE 3-37

BASE CASE, KT

FIGURE 3-22 SO2 EMISSIONS BY SECTOR IN THE

BASE CASE


Comparison of BAU and BASE Cases

The comparison of primary energy supply in the BAU and BASE cases is illustrated by Figure 3-23. By enhancing energy conservation measures in energy use, the primary energy supply can be reduced. In 2020, the reduction of primary energy supply in the BASE case is about 3.2 percent compared to the BAU case. Most of the primary energy deduction is coal, while other energy supply is the same as the BAU case.

FIGURE 3-23 COMPARISON OF PRIMARY ENERGY

SUPPLY IN THE BAU AND BASECASES

VIET NAM PAGE 79

1994 2000 2005 2010 2020

Total 120.68 159.27 287.78 375.96 712.49

SO2 EMISSIONS BY SECTOR IN THE


The comparison of electricity production by technology between the BAU and BASE cases is illustrated in Figure 3-24. Similar to the primary energy supply, electricity production by technology in the BASE case is 4.4 percent lower than that in the BAU case in 2020. The reduction of the electricity production in the BASE case is mostly in the coal fired power plants.

FIGURE 3-24 COMPARISON OF ELECTRICITY

GENERATION BY TECHNOLOGY

IN THE BAU AND BASE CASES

Total CO2 emissions of the Base case will be reduced from 4.3 to 8.3 percent in comparison with the BAU scenario during the study period. The CO2 emissions of two scenarios are shown in Figure 3-25.

FIGURE 3-25 COMPARISION OF CO2 EMISSIONS

IN THE BAU AND BASE CASES

PAGE 80

Table 3-38 lists selected indicators, including gross energy consumption in the country, energy intensity per GDP, CO2 emissions intensity and CO2emissions per capita of the BAU and Base cases, the economic implications of reducing CO2 emissions from energy related activity are shown in Table 3- 39. This Table shows that energy intensity to GDP and CO2 emissions intensity in the Base case are lower than that in the BAU case. The BASE case has 2.64 percent lower cost than the BAU case.

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TABLE 3-38 INDICATOR COMPARISON OF THE

BAU AND BASE CASES

Gross energy consumption, ktoe 10,875.26 17,215.06 34,217.51 58,841.61

Energy intensity to GDP, kgoe/ 0.70 0.66 0.62 0.54 1994 $

CO2 emissions intensity, kg/kgoe 2.02 2.67 3.07 3.35

CO2 emissions per capita, 0.29 0.57 1.12 1.85 tonne/capita

Gross energy consumption, ktoe 10,875.26 13,379.83 31,010.37 55,815.17

Energy intensity to GDP, kgoe/ 0.70 0.51 0.56 0.51 1994 $

CO2 emissions intensity, kg/kgoe 2.02 3.14 3.1 5 3.38

CO2 emissions per capita, 0.29 0.52 1.04 1.78 tonne/capita

Source: Result of optimization, 1998.

GDP (billion in Dong in 1994) 170,258 285,814 605,719 1,191,540

15,517 26,049 55,206 108,598 GDP 1994 million $

GDP per capita, 1994 $ 214 322 587 1,025

Primary energy use, ktoe 13,043 21,667 47,052 80,002

CO2 emissions (million tonnes 21.996 45.920 105.171 196.976 CO2-equivalent

34,354 Total discounted system cost 1995 $ million

Investment, 1995 $ million 2,114 4,469 930

Investment/GDP percent 8.10 8.09 0.86

Primary energy use, ktoe 13,043 20,703 45,267 77,375

CO2 emissions (million tonnes 21.996 42.147 97.769 188.649 CO2-equivalent

33,447 Total discounted system cost, 1995 $ million

Investment, 1995 $ million 1,187 2,372 946

Investment/GDP percent 4.56 4.29 0.87

Source: Result of optimization, 1998.

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TABLE 3-39 ECONOMIC IMPLICATION OF

REDUCING CARBON EMISSIONS

FROM ENERGY SECTOR

PAGE 81

The BASE case

Business-as-usual Scenario

1994 2000 2010 2020

1994 2000 2010 2020

Business As Usual Scenario (the BAU case)

The BASE case

SECTION 3

PAGE 82


Other Mitigation Scenarios

First Approach

The first approach is designed based on the reduction of CO2 emissions from the results given in the Base case. The reduction rate is set in year 2020 for three levels: 5 percent, 10 percent and 15 percent compared to the Base case. The three abatement cases are set respectively as ABAT01 (optionl), ABAT02 (option2), and ABAT03 (option3).


The ABAT01 case, with the CO2 emissions reduction rate of 5 percent in 2020 compared to the Base case, leads to the substitution of nuclear power for coal. The share of primary coal supply in the Base case is 21.2 percent in 2020, while nuclear power accounts for only 0.72 percent in the same year. By setting the constraint to abate 5 percent CO2 emissions from energy activities in 2020, the least cost solution selects less coal (18.45 percent) and more nuclear power (3.07 percent) than in the Base case to satisfy the final demand. The shares of the other primary energy in the total primary supply remains unchanged compared to the Base case.

The ABAT02 case assumes a 10 percent CO2 emissions reduction as compared to the Base case. The result is a variation in coal and nuclear power similar to that seen in ABAT01. In this case 27.7 percent of coal reduction compared with the Base case is substituted by nuclear power. It can be observed that coal share is reduced while the nuclear power share increases. The results show that coal will account for 15.5 percent of the total primary energy supply and nuclear power 5.4 percent in 2020.

percent CO2 emissions reduction, the energy substitution is between coal and natural gas, and nuclear power. In comparison with the Base case in 2020, use of coal is reduced by 30 percent, and 22 percent of natural gas is replaced by nuclear power. The nuclear power option accounts for 9.6 percent of the total primary energy supply. Table 3-40 and Figure 3-26 illustrate the primary energy supply for this and the other scenarios.

Electricity Generation

In the ABAT03, due to the more stringent constraint in 2020 of a 15

The optimization results of the different levels of constraint on CO2emissions show that the most affected energy related activity is the power generation sector. The least cost solution adopted by these abatement cases is fuel switching in the power sector.

In the Base case, the least-cost solution without CO2 emissions constraints show that 36.3 percent of the electricity generation comes from combined cycle gas plants, 14.5 percent from coal plants, while nuclear power accounts for only 1.9 percent in the total electricity generation in 2020.

In the ABAT01 case, the results show a reduction of electricity generation by coal of 9.4 percent and an increase of electricity generation by nuclear power of 9.1 percent.

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Coal 18.45 15.55 14.13

Gas 43.62 12.33 9.55

Oil 12.22 43.87 43.94

Electricity import 1.72 1.74 1.74

Nuclear 3.07 5.44 9.59

Hydropower 17.4 17.54 17.53

Biomass 3.39 3.42 3.41

Geothermal 0.08 0.08 0.08

Wind 0.05 0.05 0.05

In the ABAT02 case, the electricity generation share of coal fired thermal power plants decrease to 2.9 percent of total electricity generation in 2020, while the electricity generation from nuclear power increases to 15.9 percent. The power generation from other sources of energy remains at almost the same level as compared with that of the Base case.

from energy related activities as compared to the Base case. As a result, coal will not be used for electricity generation. At the same time, the share of electricity generation by nuclear power increases to 28 percent while the share from natural gas is reduced to 30.3 percent by 2020.

Table 3-41 shows, for the first approach, the shares of the power generation by the various technologies under these three scenarios.

Figures 3-27, 3-28 and 3-29 show the shares of electricity generation by the various technologies as projected in the milestone year for the first approach.

The ABAT03 requires a 15 percent reduction by 2020 of CO2 emissions

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TABLE 3-40 SHARES OF THE PRIMARY ENERGY

SUPPLY BY SCENARIOS IN 2020, PERCENT

FIGURE 3-26 COMPARISON OF PRIMARY ENERGY

SUPPLY IN 2010 AND 2020

PAGE 83

ABAT01 ABAT02 ABAT03

Total 100 100 100

SECTION 3

FIGURE 3-27 ELECTRICITY PRODUCTION IN

2000 BY TYPE OF TECHNOLOGY

- FIRST APPROACH

FIGURE 3-28 ELECTRICITY PRODUCTION BY

TYPE OF TECHNOLOGY IN

2010- FIRST APPROACH


TABLE 3-41 SHARES OF POWER GENERATION

IN 2020 BY TECHNOLOGY - FIRST APPROACH, PERCENT

PAGE 84

Coal-fired 9.39 2.87 0.00

Gas-turbine 0.42 0.42 0.42

Oil-fired 0.52 0.51 0.51

Diesel 0.00 0.00 0.00

Gas-CC 39.53 39.38 30.27

Nuclear 9.12 15.94 28.05

Hydropower 40.13 39.98 39.86

Biomass 0.08 0.08 0.08


Wind 0.32 0.31 0.31

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Total 100 100 100

SECTION 3

Second Approach

In the second approach, the CO2 reduction is set to decline from the year 2000 at three levels: 0.5 percent, 1 percent and 1.1 percent per annum as compared to the Base case. These three scenarios are established as ABAT04 (opt4), ABAT05 (opt5), and ABAT06 (opt6).


The ABAT04 case, with the CO2 emissions reduction rate of 0.5 percent per annum as compared to the Base case, leads to the substitution of nuclear power supply for coal supply. By setting the constraint to abate 0.5 percent CO2 emissions during 2000 to 2020 from energy activities, the least cost solution to satisfy final demand results in less coal and more nuclear power than in the Base case. The shares of the other primary energy in the total primary supply remain unchanged compared to the Base case.

The ABAT05 case sets the CO2 reduction rate to 1 percent per annum compared to the Base case. In the ABAT05 case, the main variation is the greater substitution of nuclear power for coal based power as seen in the ABAT04 case.

In the ABAT06 case, due to a more stringent constraint on CO2emissions of 1.1 percent per annum, nuclear power is substituted for not only coal but also natural gas power plants as well. The least cost option results in a reduction of 29.1 percent of coal and 30.5 percent of gas use in comparison with the Base case in 2020. The resulting nuclear power option accounts for 10 percent of the total primary energy supply. Figure 3-30 illustrates the primary energy supply in the second approach.

Electricity Generation

In the ABAT04 case, the results show the reduction of electricity generation by coal and the increase of electricity generation by nuclear power for the period 2005-2020. The share of electricity generation by coal

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TYPE OF TECHNOLOGY IN 2020 —FIRST APPROACH

PAGE 85


FIGURE 3-30 PRIMARY ENERGY SUPPLY IN

2010 AND 2020 - SECOND

APPROACH

ranges from 11.6 percent in 2005 to 14.9 percent by 2020 in the Base case and is expected to be reduced to 7.8 percent in 2005 and 5.3 percent by 2020 in this case. While the share of oil fired power plants for total electricity generation increases from 3.6 percent in 2005 and 2.2 percent in 2010 in the Base case to 5.9 percent in 2005 and 3.6 percent in 2010 in this case. In 2020 the reduction of electricity generation by coal will be replaced by nuclear power (2.0 percent in the Base case compared to 11.4 percent in the ABAT04 case).

power plants will be reduced rapidly from 7.8 percent of total electricity generation in 2005 to 0 percent in 2020, while 28.1 percent of electricity generation is expected to come from nuclear power in 2020. The contribution from oil product for power generation will increase from 3.5 percent in 2005 in the Base case to 5.9 percent in the ABAT05 case.

In the ABAT05 case, the electricity generation share of coal fired thermal

TABLE 3-42 SHARES OF THE POWER

GENERATION BY TECHNOLOGIES

IN 2020 - SECOND APPROACH, PERCENT

PAGE 86

Coal-fired 5.88 0.00 0.00

Gas-turbine 0.42 0.42 0.42

Oil-fired 0.51 0.51 0.51

Diesel 0.00 0.00 0.00

Gas-CC 39.46 30.27 27.65

Nuclear 12.78 28.05 30.69

Hydropower 40.05 39.86 39.84

Biomass 0.08 0.08 0.08


Wind 0.32 0.31 0.31

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Total 100 100 100

SECTION 3

The ABAT06 case requires the reduction of CO2 emissions from energy related activities with 1.1 percent per annum from 2005 compared to the Base case. Coal will not be used for electricity generation in 2020 and it will be very small in 2010 (about 1.5 percent compared to 8.6 percent in the Base case). By contrast, nuclear power will contribute 30.7 percent in the total electricity generation. Shares of the power generation by technologies in 2020 are shown in Table 3-42.

the milestone year. Figures 3-31, 3-32 and 3-33 show the shares of electricity generation for

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TYPE OF TECHNOLOGY –SECOND APPROACH IN 2000


TYPE OF TECHNOLOGY – SECOND

APPROACH IN 2010


TYPE OF TECHNOLOGY –SECOND APPROACH IN 2020

PAGE 87

SECTION 3

3.4.5 IMPACTS OF ENERGY SECTOR

SCENARIOS

PAGE 88


Comparison of Approaches to CO2 Constraints

The key difference between the approaches presented in this section consists in the way CO2 emissions abatement constraints are applied over the study period. In the first approach, CO2 constraints are applied only at the end of the study period (i.e., in 2020) and several cases are analyzed depending on the level of the CO2 emissions abatement constraint applied (i.e. 5 percent, 10 percent, and 15 percent CO2 reduction compared to the BASE Case). In the second approach CO2 emissions abatement constraints are applied all along the study period between 2000 and 2020 (i.e., at 0.5 percent, 1 percent and 1.1 percent per year CO2 emissions abatement as compared to the BASE Case).

The results of the first approach show that the CO2 emissions reduction appears only in the last period of the study (i.e. 2015-2020), whereas in the second approach CO2 emissions reduction is gradual from 2000 until 2020.

In the first approach, the modifications of the primary energy structure and of the power sector (fuel and technologies) happen only in the last period under study (i.e. 2015-2020). However, in the second approach, the primary energy structure and the power sector show regular changes all along the study period (2000 to 2020). In terms of the final structure of the Power sector in 2020 in the most extreme (stringent) cases in both approaches (i.e. ABAT03 and ABAT06), small differences appear as shown in Tables 3.4.5.14 and 3.4.5.15. In terms of CO2 emissions abatement, both cases (ABAT03 and ABAT06) correspond to a similar CO2 abatement rate of around 15 percent in 2020 compared to the BASE Case.

The approaches correspond to different policy strategies. The first approach consists in limiting GHG emissions on the basis of a given target year (i.e. 2020), while the second approach corresponds to imposing a gradual abatement of CO2 emissions on the energy sector activities.

Scenarios for Specific Mitigation Options

There were seven specific technical options assessed for least-cost mitigation: two energy supply options and five energy efficiency options.

(i) Efficient Coal Cooking Stoves (ENV-1)

The ENV-1 option considers the efficiency improvement of coal cooking stoves. The average efficiency of existing coal cooking stoves is estimated to be 17 percent. It is assumed that it is possible to increase the efficiency up to 25 percent. The incremental cost of the efficiency improvement is estimated at about $50 per ktoe of saved coal.

mt. The incremental cost of avoided CO2 mitigation is –$4.15 per t. The least-cost results show a potential cumulative CO2 mitigation of 73

(ii) Compact Fluorescent Lamps (ENV2)

The ENV-2 option proposes to replace incandescent light bulbs (ILBs) by energy-efficient compact fluorescent lamps (CFLs). Average power consumption of the existing bulb is about 75W and electricity consumption is about 110kWh per annum. CFLs use roughly 80 percent less electricity but CFLs are more expensive than ILBs. The lifetime of CFLs is estimated to be 8

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SECTION 3

times more than that of ILBs. However the cost of CFLs is higher than that of IBLs.

mitigated with an incremental cost of –$8.31 per t of avoided CO2 emissions from switching to CFLs.

The EFOM-ENV model results indicate a potential 16 mt of CO2

(iii) Energy-efficient Refrigerators (ENV3)

The ENV-3 option relates to better marketing of energy-efficient refrigerators to replace existing refrigerators. The average refrigerator efficiency assumed results in a unit consumption of 521 kWh/year or about 85 percent of the energy consumed as compared to the old refrigerators.

incremental cost of –$8.53 per t of avoided CO2. The modeling results show a potential 88 mt of CO2 reduction with an

(iv) Energy-efficient Air Conditioners (ENV4)

Window air conditioners are commonly used in residential and commercial applications in Viet Nam. This option involves the replacement of inefficient air-conditioners with energy-efficient units.

cost of -$10.54 per t avoided CO2. The results show a potential 52 mt of CO2 reduction with an incremental

(v) High Efficient Electric Motors (ENV5)

The ENV5 option considers the replacement of existing motors with energy efficient motors. It is assumed that the average efficiency of standard electric motors can be improved by at least 5 percent from 86 percent to 91 percent.

incremental cost of avoided CO2 for this option was estimated to be -$7.19 pert of CO2.

The results indicate a potential CO2 mitigation in the order of 70 mt. The

(vi) The Fuel Switching in Existing Thermal Power Plants (ENV6)

The ENV6 option considers the substitution of coal by oil in existing thermal power plants in the north and oil by gas and increasing gas used in generation of existing thermal power plants in the south. In this scenario primary energy supply is not much different when compared with the Base scenario. The share of fuel oil in total fuel for generation is higher than that of the Base scenario, while the coal share is lower.

The switching from coal to oil in the north and oil to gas in the south for power generation reduces GHGs emissions in very large amounts. The total GHGs (CO2) emissions of this scenario will be 14 mt CO2 with an incremental cost of $46.4 per t of avoided CO2.

(vii) Wind Power Plants (ENV7)

Wind power is a new energy technology and also a new concept in Viet Nam. In the past, small stand-alone wind power stations for battery charging were used for low power needs such as lighting and telecommunication.

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PAGE 89


They are most likely to be installed in remote islands as cheaper alternatives for diesel generator sets.

The total GHGs (CO2) emissions for this option is 34 mt CO2 with an incremental cost of -$4.64 pert of avoided CO2.

Table 3-43 presents a summary of the differences in cumulative costs and emissions of the seven mitigation options considered. The mitigation options lead to savings in CO2 emissions of between 5 and 88 mt. Similarly, the incremental costs vary from option to option. Six out of the seven options can be implemented at negative incremental costs.

their incremental costs per t of CO2 reduced. Energy efficient air conditioners followed by energy efficient refrigerators and compact fluorescent lamps are most cost effective in reducing CO2 emissions. Figure 3-34 shows that in total more than 333 mt of CO2 can be reduced at negative incremental costs by implementing the six most cost-effective mitigation options.

The table further provides a ranking of mitigation options according to

TABLE 3-43 DIFFERENCES IN CUMULATIVE CO2

VARIOUS SCENARIOS COMPARED

EMISSIONS AND COSTS BY

TO BAU SCENARIO

FIGURE 3-34 CERI CURVE FOR INDIVIDUAL

OPTIONS

PAGE 90

CO2 emissions, Mt 2,477 2,404 2,461 2,389 2,425 2,407 2,472 2,443

5 34 ∆CO2 emissions, Mt 73 16 88 52 70

–4.15 –8.31 –8.53 –10.54 –7.19 46.4 –4.64 Cost per tCO2 reduction, $/tCO2

Source: Results from optimization, 1998. ENV-1: Efficiency improvement in coal

ENV-2: Compact fluorescent lamps ENV-3: Energy efficient refrigerators

ENV-4: Energy efficient air conditionersENV-5: High efficient electric motors ENV-6: Fuel Switching in existing thermal

power plant ENV-7: Wind power plant

cooking

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Cost $ million 34,354 34,051 34,221 34,603 34,806 34,851 34,586 34,196

∆Costs $ million –303 –133 –751 –548 –503 232 –158

SECTION 3

CERI Curve by Reduction of CO2 Emissions Growth Rate

The First Approach

In the BAU case, the final energy demand was projected based on economic development indicators by the MEDEE/S model. The primary energy supply was calculated to meet the demand optimized by the EFOM- ENV model. The total CO2 emissions in 2020 are expected to be 197 million ts. Discounted cost of the whole study period is about $34,354 million.

EFOM-ENV model with the improvement of efficiency in energy use. The total CO2 emissions of the optimal solution is 189 million ts, 4.2 percent less than that of the BAU case. The discounted cost is expected to be $33,447 million. Cost for reduction of 1 t CO2 emissions is calculated at – $109.

CO2 emissions abatement at 5 percent, 10 percent, and 15 percent in 2020 compared to the BASE case, the CO2 emissions will be reduced by 9.0 percent, 13.8 percent, and 18.4 percent compared to the BAU case respectively. The discounted cost of the ABAT01 case will be higher than that of the BASE case but lower than the BAU case. The incremental cost of the ABAT01 case is –$31 per t avoided CO2 emissions in comparison with the BAU case, while those of ABAT02 and ABAT03 are $3.88 per t avoided CO2 emissions and $4.87 per t avoided CO2 emissions respectively. Table 3-44 shows CO2 emissions and total discounted cost in first approach and Table 3-45 presents the CO2 emissions abatement and incremental cost in the first approach.

In the BASE case, the final demand and supply were optimized by the

In the ABAT01, ABAT02, and ABAT03 cases, by setting the constraints of

In the ABAT04, ABAT05, and ABAT06 cases, constraints were set on CO2 emissions annual reduction by 0.5 percent, 1 percent, and 1.1 percent in period 2005-2020 compared to the BASE case. The total CO2 emissions reduction in the whole study period compounds to 13 percent by ABAT01, 17.5 percent by ABAT02, and 18.7 percent by ABAT03, compared to the BAU case. The discounted cost of ABAT04 and ABAT05 cases will be higher than that of the BASE case, but lower than the BAU case. The incremental cost of the ABAT04 case is – $1.47 per t avoided CO2 emissions, and that of the

BAU BASE

BAU 22.00 45.92 77.10 105.17 196.98 34,354.00

BASE 22.00 42.15 72.39 97.77 188.65 4.23 0.00 33,447.00

ABAT01 22.00 43.20 74.36 101.08 179.22 9.02 5.00 34,139.00

ABAT02 22.00 43.20 74.36 101.08 169.78 13.80 10.00 34,429.00

ABAT03 22.00 43.20 74.36 101.08 160.35 18.59 15.00 34,492.00

Source: Results of optimization, 1998.

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APPROACH

DISCOUNTED COST IN THE FIRST

PAGE 91

1994 2000 2005 2010 2020

Percent CO2 abatement in 2020 compared

to

Discounted cost

$ million

The Second Approach


FIGURE 3-35 CO2 EMISSIONS IN THE FIRST

APPROACH

TABLE 3-45 CO2 EMISSIONS ABATEMENT

FIRST APPROACH

AND INCREMENTAL COST IN THE


RELATION IN THE FIRST

APPROACH

AND INCREMENTAL COST

PAGE 92

Percent mt

BAU 2.477 0 34,354.00 0

BASE 2.395 3.33 82 33,447.00 –907 –1 1

ABAT01 2.224 10.23 254 34,139.00 –215 –0.85

ABAT02 2.13 14.04 348 34,429.00 75 0.22

ABAT03 2.036 17.85 442 34,492.00 138 0.31


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Case

CO2 emissions in 2020,

Mt

CO2 abatement in whole period

compared to BAU case

Discounted cost,

$ million

Incremental cost,

$ million

Cost for 1 t CO2

emissions reduction,

$/t


ABAT05 case is -$0.88 per t avoided CO2 emissions in comparison with the BAU case while that of ABAT06 is $0.11 per t avoided CO2 emissions. Table 3- 46 shows CO2 emissions and total discounted cost and Table 3-47 presents the CO2 emissions abatement and incremental cost in the second approach.

BAU BASE

BAU 22.00 45.92 77.10 105.17 196.98 34,354.00

BASE 22.00 42.15 72.39 97.77 188.65 4.23 0.00 33,447.00

ABAT01 22.00 43.20 72.03 95.36 175.05 11.13 7.21 34,101.00

ABAT02 22.00 43.20 71.67 93.02 162.49 17.51 13.87 34,129.00

ABAT03 22.00 43.20 70.89 92.56 160.10 18.72 15.13 34,384.00


Percent mt

BAU 2,477.74 0.00 34,354 0.00

BASE 2,395.25 3.33 82.49 33,447 –907.00 –10.99

ABAT01 2,305.40 6.96 172.34 34,101 –253.00 –1.47

ABAT02 2,221.42 10.34 256.32 34,129 –225.00 –0.88

ABAT03 2,201.65 11.14 276.09 34,384 30.00 0.11


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SECOND APPROACH

DISCOUNTED COST IN THE

FIGURE 3-37 CO2 EMISSIONS IN THE SECOND

APPROACH

TABLE 3-47 CO2 EMISSIONS ABATEMENT AND

INCREMENTAL COST IN THE

SECOND APPROACH

PAGE 93

1994 2000 2005 2010 2020


2020 compared to

Discounted cost,

$ million

Case

CO2 emissions in whole

period, mt

CO2 abatement in whole period

compared to BAU case

Discounted cost,

$ million

Incremental cost,

$ million

Cost of CO2 emissions

reduction, $/t




RELATION IN THE SECOND

APPROACH

PAGE 94

Comparison of Both Approaches

The results in Tables 3.4.6.3 and 3.4.6.5 show the cumulative abatement of CO2 emissions corresponding to the first and second approaches. The results are generally higher in the first approach than in the second approach for an equal level of CO2 emissions abatement. For example, the CO2 abatement for the study period is 254 (10 percent), 348 (14 percent) and 442 (18 percent) mt of CO2 in ABAT01, 02 and 03 respectively as compared to 172 (7 percent), 256 (10 percent) and 276 (11 percent) million ts of CO2 in ABAT04, 05 and 06 respectively. When looking at the costs of emissions reduction (in $ per t of CO2 abated), it is interesting to note that the abatement options corresponding to both approaches are similar when comparing them on an equal basis of CO2emissions abatement. For example, the BAT05 case (which corresponds to a 10 percent abatement of CO2 emissions) has an abatement cost of –$0.88 per t. This is comparable to the ABAT01 case (which also corresponds to a 10 percent abatement of CO2 emissions) results in an abatement cost of –$0.85 per t). In both approaches, when CO2 abatement requirements increase to a certain limit, the abatement costs become positive indicating an increased positive cost

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SECTION 3

related to these abatement options. That is, the more stringent the CO2 emissions abatement, the higher will be the cost.

The main difference between both approaches resides in the way CO2 emissions abatement is applied to the energy system. In the first approach we look at abating CO2 by year 2020. In the second approach, CO2 emissions abatement is progressively applied from 2000 up to 2020. The second approach is probably more realistic in terms of environmental policy as the investments in CO2 emissions abatement will be progressively done throughout the study period. The first approach assumes that all the investments will be done only during last period of the study (i.e., 2015-2020). This is clearly less desirable.

In Viet Nam, the technologies on both the supply and demand sides are very old and obsolete. The priority of energy efficiency improvement has been considered as a strategy of development. Any measure or action to be implemented in order to increase energy use efficiency will have positive economic and environmental effects.

reducing GHGs emissions, but the investment costs for these options are higher than others. Hydropower will be one of the most reliable initiatives. The environmental cost of hydropower schemes in term of land loss and resettlement requirements are considerable and there is some evidence that these have been underestimated. There may be also environmental benefits from hydropower projects arising from improved conditions for river traffic and from the cleaner and more regular flows of water downstream of reservoirs. The balance of these impacts is not an easy matter.

From the results of this project, preliminary estimates for some of the options are provided, especially for environmental impacts. A detailed socioeconomic and environment impacts assessment should be implemented for specific projects.

Switching to low or non-GHGs emitting fuels is an effective measure for

The overall abatement strategy is summarized below:

(i) Energy Supply

(ii) Energy consumption

Development of hydropower resources, with special focus on the highly economic efficient projects on the Da, Sesan and Dongnai river Development of natural gas for power generation Substituting coal and oil by gas for power generation Reducing losses on energy transportation and distribution Improvement of efficiencies at existing power plants

Improvement of the efficiency in existing State - industrial enterprises Improvement of the efficiency of major electrical appliances and equipment Improvement of the efficiency of cooking stoves, especially stoves using coal and fuelwood

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3.5 ENERGY SECTOR LEAST - COST GHGs ABATEMENT

STRATEGY

AND GOALS

3.5.1 GENERAL ABATEMENT STRATEGY

PAGE 95

SECTION 3

3.5.2 PROPOSED TIME-LINE FOR

IMPLEMENTATION OF STRATEGY

PAGE 96


Reduction of the electrical demand from new international style commercial buildings by improving new building energy efficiency standards.

This strategy is proposed to be implemented in short, medium and long- term plan.

Short-term initiatives

The measures listed below should be implemented in existing industrial enterprises and processes.

(i) Improvement of efficiency of fuel transformation in boilers by:

Combustion control Maintenance of insulation Boiler water quality control Cleaning of exchanger surface Increasing boiler load Improving fuel preparation

(ii) Equipment services

Measurement devices Computer and control devices Insulating materials Operation control Training in energy management

Incremental costs for these measures are low and should be negligible. The most cost-effective initiatives for reducing GHGs emissions are

improving of efficiency on the demand side. These options have the most potential for economic investment and GHGs abatement during the study period. The implementation of these technological measures will be part of the proposed energy conservation programs:

(i) Energy efficient air conditioning (ii) Energy efficient refrigerators (iii) Application of compact fluorescent lamps (iv) Application of high efficient electric motors.

Medium-term initiatives

These initiatives are identified as the measures to be implemented up to 2010 to 2015.

(i) Improvement of industrial fuel use and heat distribution: These initiatives are related to measures for improvement of energy efficiency by using new equipment and include automatic combustion control, new efficient burners, heat recovery and automatic control systems. The cost of these initiatives include the cost of designing and engineering. Energy saving is estimated at up to 30

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SECTION 3

percent of total thermal energy. The initiatives will be implemented by state-owned industrial enterprises in the period 2000 to 2015 according to the industrialization and modernization policy.

models. The energy saving is estimated to be 20 percent of electricity consumption.

appliances. Studying implementation of new and renewable energy for power generation and end-use consumers.

energy efficiency in existing state-owned industrial enterprises and building systems.

(ii) Replacing old inefficient electrical appliances by new efficient

(iii) Adopting and implementing efficiency standards for electrical

(iv) Developing and implementing of standards for improvement of

Long-term initiatives

The measures relate to redesigning the energy distribution systems, replacing inefficient industrial equipment, fuel substitution of coal and oil by natural gas, and cogeneration using agricultural residues and waste heat from cement production.

Table 3-48. A summary of some of the abatement strategy initiatives is provided in

Fuel switching 1.6 46.4

Wind power construction

Improvement of efficiency in cooking

10.9 –4.64

23.4 –4.15

CFL 5.1 –8.13

16.6 –10.54 Highly efficiency air conditioning

Highly efficiency refrigerator

Highly efficiency electric motors



28.2 –8.53

22.4 –7.19

13.6 –4.64

29.2 –4.15

CFL 6.4 –8.13 Medium term (2005-2015) Highly efficiency air 20.8 –10.54

conditioning


35.2 –8.53

VIET NAM


TABLE 3-48

COST ABATEMENT STRATEGY

ENERGY INITIATIVES

SUMMARY OF NATIONAL LEAST-

PAGE 97

Implementation time frame

GHGs abatement initiative

Potential carbon abatement or sink

enhancement, mt of CO2

Cost of initiative $ t/

CO2


SECTION 3

3.6 CONCLUSIONS AND

RECOMMENDATIONS

PAGE 98





8.2 –4.64

17.5 –4.15

CFL 3.8 –8.13

12.5 –10.54 Highly efficiency air conditioning



21.1 –8.53

16.8 –7.19

The energy sector is one of the most important motive forces of economic development in Viet Nam. The high growth rate of the economy requires to the use of more energy. To support economic growth, primary energy supply should be adequate to meet energy demand.

(i) The final energy demand of Viet Nam over the next two decades will be expected to increase dramatically. Final energy consumption in 2020 is projected to be 6-7 times hgher than in the base year 1994. As a result, GHGs emissions will dramatically increase at both the sectoral and national level.

(ii) The industry sector will play a dominant role and will be responsible for more than 50 percent of the total energy demand in 2020. The GHGs mitigation of the industry sector is significant. The improvement of efficiency in industrial production in order to reduce energy consumption and GHGs emissions will be one of the most effective ways for GHGs abatement.

economic investment and GHG emissions abatement in the study period. The incremental costs of most efficiency improvement options evaluated in this study are negative when compared with the BAU case.

(iv) Switching to fuels that emits less GHGs has been proposed for thermal power plants. However, replacing oil with gas in the South and coal with oil in the North is costly when compared with the other options.

complete assessment of the environmental and social impacts of hydropower schemes has not been undertaken. The environmental costs in terms of the land loss and resettlement are considerable, and there is some evidence that these have been underestimated in

(iii) Improving the efficiency of energy use has the most potential for

(v) Hydropower options have been taken into consideration, but a

VIET NAM

Implementation time frame

GHGs abatement initiative

Potential carbon abatement or sink

enhancement, mt of CO2

Cost of initiative $ t/

CO2

Long term (beyond 2015)

SECTION 3

previous studies. There may be also other benefits from hydropower development that have not been assessed.

(vi) The best prospects for reduction of GHGs emissions are expected in the power generation sector. These include options such as the transformation of existing coal and oil fired thermal plants to use of natural gas, the construction of new combined cycle power plants, and construction of hydropower plants.

(vii) Many mitigation measures including switching to renewable energy will result in both national and global environmental benefits.

(ix) The ALGAS Project encountered limitations related to the availability of data. Detailed input data for the model assessments were not available. There are some differences in the data provided by different sources, especially the data of long-term projections. The measures to overcome constrains that were identified during the project require upgrading the ALGAS country team with sector experts, and establishing a national and provincial network for further studies and data collection.

(x) The information relating to the world market for environment-friendly technologies is insufficient. This lack of information limits the number of technical options that were assessed. International cooperation and communication should be upgraded to help obtain more reliable information for the future.

(xi) The knowledge and recoption of the need for abatement of GHGs emissions by policy makers and planners is a very important factor for successful implementation. The least-cost strategy developed by the ALGAS Project can serve as input for policy formulation.

Duong Quang Thanh 1995. “Long term optimization strategy for CO2emissions abatement in the energy sector.”

Institute of Energy, 1994. “Energy Balance of Viet Nam.” Ha Noi, Viet Nam

, 1995. “Power Development Master Plan Stage 4.” IOE, Ha Noi, Viet Nam.

Intergovernmental Panel on Climate Change (IPCC) 1996. “Climate Change” 1995, Impact, adaptation and mitigation of climate change, Scientific technical analyses. IPCC Group II.

Jayant Sathaye and Stephen Meyers, Greenhouse Gas Mitigation Assessment. A Guidebook, Environmental science and technology library. US Country Study.

General Geological Department, 1998, Geology and Mineral Resources. Volume 1, Ha Noi, Viet Nam.

General Statistical Office, 1995. “A survey on living standard of Viet Namese people”, Hanoi, Viet Nam.

VIET NAM


REFERENCES

PAGE 99

SECTION 3

PAGE 100


Ha Noi University of Technology, 1995. National Energy Statistics. Ha Noi, Viet Nam.

Ministry of Energy, 1995. “Energy review.” Ha Noi, Viet Nam.

Ministry of Planning and Investment, 1996. “Comment on Draft of 5 years Plan for Social - Economic Development of Viet Nam.” Ha Noi, Viet Nam.

, 1996. “Orientation for a National Energy Strategy,” Final report of ADB Technical Assistance Project. Ha Noi, Viet Nam.

, 1996. “The Economic Development Policy in the transition toward a market oriented economy in the RSV,” Final report: Macroeconomy, Ha Noi, Viet Nam.

, 1996.“The Economic Development Policy in the transition toward a market oriented economy in the RSV.” Final report, Industrial Policy. Ha Noi, Viet Nam.

, 1996. “The Economic Development Policy in the transition toward a market oriented economy in the RSV. ” Final report, Fiscal and Monetary Policies, Ha Noi, Viet Nam.

National Statistical Department, Statistical year Books 1991, 1992, 1993, 1994, 1995, 1996. Ha Noi, Viet Nam.

United National Environment Programme, 1994. UNEP “Greenhouse Gas Abatement Costing Studies.” Riso National Laboratory, Denmark.

Viet Nam Government Report at consultation meeting, 1995. “Report on Social Economic Development of Viet Nam and Investment Need in five years 1996 - 2000,” Paris.

Viet Nam Coal Cooperation, 1996. “Coal Investigation and Design, VinaCoal,” Hanoi, Viet Nam.

World Bank 1996. “Demand Side Management Study Report,” Hanoi, Viet Nam.

VIET NAM

SECTION 4FORESTRY AND LAND-USE

CHANGE SECTOR ASSESSMENT

iet Nam has a total land area of 33 million hectares (mha), and it lies between latitudes 8o35' N and 23o24' N. About 19 mha, accounting V for 58 percent of the land area of Viet Nam, are classified as forestland.

Half of that area, 9.3 mha are dense forests. Most of the other half is covered by bush or open tree stands, but some bear almost no vegetation at all. The only large areas of natural forest remaining are located in the highlands of southern Viet Nam and are evergreen or semi-deciduous, often dominated by dipterocarp species. These forests constitute the most valuable wood resource of the country and will continue to do so well into the next century.

Forestland in Viet Nam is divided into three categories: (i) Special use forest, (ii) Protection forest, and (iii) Production forest, and each of these covers only a part of the area. The forest use classification provides a broad structural basis for the description of primary forest values. The Special use class recognizes scenic, amenity, scientific, and cultural values. Forests in the Protection class have, primarily, watershed and coastal protection value. The Production class includes forest types capable of yielding wood and other forest products.

summarized in Table 4-1. The areas of forest type and forest use classes in Viet Nam are

Production Protection Special Use

Woody forests 4,593 2,154 475 7,222

Bamboo forests 881 207 33 1,121

Woody/Bamboo 260 64 30 354

Others 27 1 1 29

Source: Forest Inventory and Planning Institute, 1989.

The areas under different forest categories in 1993, according to the Forestry Science Institute, Ministry of Agriculture and Rural Development, are shown in Table 4-2.

The forestry sector is critically important in the social and economic development of both urban and rural communities, and the success of general development strategies will depend to a considerable extent on how the forest resource is being managed. The forestry sector in Viet Nam contributes about 3 percent to the GDP. In global terms, the forestry sector offers a number of options for reducing GHGs, particularly carbon, emissions. According to preliminary estimates by the Intergovernmental Panel on Climate Change (IPCC) Working Group II (1996), between 1995 and 2050 about 60 to 90 Gt of carbon emissions could be reduced or sequestered through slowing deforestation, establishment of plantations, agro-forestry, and forest regeneration. Thus there is a large potential to reduce carbon emissions through forestry sector abatement strategies.

VIET NAM


BACKGROUND

TABLE 4-1 AREAS OF FOREST TYPE AND

FOREST USE CLASSES OF VIET

NAM IN 1989, KHA

PAGE 103

Forest Types Forest Use Classes

Total

Natural Forest

Total 6,301 2,460 548 9,309

Plantations 540 34 9 583

SECTION 4

TABLE 4-2 AREAS BY FOREST CATEGORIES

IN 1993

4.2 SECTOR GREENHOUSE

GAS INVENTORY

4.2.1 INTRODUCTION

PAGE 104

FORESTRY AND LAND-USE CHANGE

SECTOR ASSESSMENT

Evergreen 1,335

Secondary 4,852

Mixed 392

Young 1,453

Bamboo 580

Other 45

Acacia 120

Eucalyptus spp 479

Pines spp 40

Other species 160

Woody 3,334

Shrub 3,323

Grass 4,134

Rocky 628

Source: Forestry Science Institute, 1995.

According to the Forest Inventory and Planning Institute (FIPI), the achievements of the national reforestation program are impressive, with recent annual planting of about 125,000 ha. However, it is clear that the reforestation accomplishments have been lower than expected. The natural forests are shrinking in area due to shifting cultivation and clearing for permanent agriculture, and they are also being degraded through unsustainable exploitation for logs and fuelwood. Deforestation continues to be a serious problem of the country. It is estimated that the rate of annual forest loss is at about 150,000 ha. This problem needs to be solved in the years to come.

This chapter discusses several key issues related to: (i) sector emissions inventory; (ii) sector mitigation analysis; and (iii) assessment of different strategies and development of the least-cost strategy.

Forests are both a source and a sink of carbon dioxide, which is the GHGs most associated with the forests. Activities such as forest land conversion and exploitation of forests lead to the emissions of CO2 into the atmosphere, whereas the planting of forests sequesters CO2. The 1993

VIET NAM

Forest types Area, kha

Plantations 799

Savanna 11,419

TOTAL 20,875

Natural forest 8,657

SECTION 4

National GHG inventory in Viet Nam shows that the total GHGs emitted from the forestry and land use change sector was about 31.3 million tonnes (mt) in CO2-equivalent, accounting for 25.4 percent of total of GHG emissions in the country. Forest conversion is one of the major causes of forest loss in Viet Nam. It is estimated that around 0.5 mha of forestland is converted annually by clearing of forests for agricultural use or shifting cultivation in Viet Nam.

Under the Asian Development Bank’s Regional Study on Global Environment Issues, the 1990 National GHGs Inventory has been carried out based on the OECD method. Under the ALGAS Project, the most recent National GHGs Inventory has been carried out by the Institute of Meteorology and Hydrology (IMH), Hydrometeorological Service (HMS) of Viet Nam, in cooperation with the Forest Science Institute (FSI), Ministry of Agriculture and Rural Development (MOARD). The IPCC method was used for this inventory. At the time of inventory, 1993 was selected as the year to represent the period in which Viet Nam’s economy system is transforming from a planned to a market-oriented economy. Moreover, the newest official data that could be used for this inventory were from 1993. Thus, 1993 was chosen as basic year for the inventory.

Viet Nam used the standard IPCC methodology for emissions inventory in the land-use change and forestry sector. The major spreadsheets of the IPCC methodology included the following submodules.

(i) 5.1 Changes in forest and other woody biomass stocks

This submodule deals with the emissions or sequestration of carbon (and carbon dioxide) due to change in forest and other woody biomass stocks affected by human activity.

(ii) 5.2 Forest and grassland Conversion

In this submodule, total carbon emissions from deforestation or forest clearing is calculated through the main activities such as burning of aboveground biomass on site, decaying of timber biomass used off site, and decomposition of aboveground biomass on site.

(iii) 5.3 On-site burning of forests (for trace gases)

This submodule deals with the emissions of CH4, CO, N2O, and NOx due to on-site burning of plant residues after deforestation. The method of calculation is very similar to that of non-CO2 trace gases from burning of traditional biomass for energy.

(iv) 5.4 Abandonment of managed lands

This submodule deals with removals of CO2 resulting from the natural regeneration of forest in abandoned farmland or degraded forest, as well as dry tropical forests. The activity involved is annual carbon uptake by aboveground biomass in abandoned farmlands and dry tropical forests.

VIET NAM


SECTOR ASSESSMENT

4.2.2 METHODOLOGY

PAGE 105

SECTION 4

4.2.3 DATA SOURCES

PAGE 106


SECTOR ASSESSMENT

The IPCC method and approach was used. Thus, no detailed

In order to calculate emission/uptake of carbon from the land use explanation is given in this section.

change and forestry sector, the data have been collected mainly from General Statistical Office, FSI, and Forest Inventory and Planning Institute (FIPI). Other data sources for this GHGs inventory include the data and results from the Forestry Sector Review, Forestry and Land-use reports, Government reports, and publications of the Food and Agriculture Organization (FAO).

follows.

(i) Area under forests and forest types:

Natural forest and savanna, grass lands:

Main documents, reports, publications etc., were used for the inventory as

1983 survey data and forest resource inventory, Ministry of Forestry (MOF)

Plantation:

Results of national forest inventory in 1993, MOF. Forestry in Viet Nam, Hanoi, 1992, MOF.

1994 Statistical Year Book, General Statistical Office

Forestry Sector Review, Hanoi, 1990, MOF. Sector report on results of reforestation.

(ii) Area converted or deforested annually:

Forestry Sector Review, Hanoi, 1990, MOF. Tropical Forestry Action Program, Hanoi, 1991, MOF. Forestry Sector Review: Land use issues, Hanoi, 1991, MOF.

(iii) Biomass in the forest, plantation types and growth rate of biomass:

Forestry Sector Review, Hanoi, 1990, MOF. Sector report and publications of FSI and FIPI, Ministry of Forestry.

(iv) Sources and end uses of wood or timber:

Statistical data of Agriculture, Forestry, and Fishery 1985-1995, Hanoi, 1996. Sector report of FSI and results of the survey on firewood in rural area.

Fraction of biomass burned on and off site:

These data were obtained from several publications of India, Indonesia, and Thailand.

(v)

VIET NAM

SECTION 4

(vi) Area abandoned for forest regeneration:

The data were estimated based on the forest and savanna inventories in 1983 and 1993.

Soil carbon content and annual carbon uptake:

Sectoral reports on organic matter (humus) in different depths of soil in several forest types and ecological regions. Greenhouse Gas Inventory Workbook, IPCC, 1995.

(vii)

Changes in Forest and Other Woody Biomass Stocks

As mentioned in Section 4.1, areas under different forest categories in Viet Nam in 1993 are shown in Table 4-2. Three main categories are: (i) Plantations, (ii) Natural forests, and (iii) Savannas. These area data were used for estimating total carbon content in annual growth of forests. In addition, dispersed trees (e.g., urban, village, farm trees) were added for this estimation. It is estimated that more than 1.2 million dispersed trees were planted in the country in 1993. Total annual growth increment or carbon uptake increment by forest/biomass stock was about 30.78 Tg carbon.

According to the MOARD, total biomass consumption in the year 1993 was about 32,316 kt dry matter (dm), of which wood consumption for commercial and other purposes was 3,643 kt dm and for fuel was 28,672 kt dm. Wood removed in forest clearing was 1,372 kt dm. Therefore, the total biomass consumption from stock would be about 30,944 kt dm. As a result, annual carbon release from total biomass consumption from the stocks was 15.47 Tg C. Net carbon uptake could be estimated by subtracting the annual carbon released from the total annual carbon uptake. Total carbon uptake due to changes in forest and other woody biomass stocks is shown in Table 4-3.

1 Total C uptake/increment 30.78

3 Net Carbon uptake 15.31

Forest and Grassland Conversion

This category includes conversion of existing forest and natural grasslands to other land uses, such as agriculture. In order to estimate amount of carbon emissions due to forest and grassland conversion, three sets of calculations have been used:

VIET NAM


SECTOR ASSESSMENT

4.2.4 NATIONAL GHGs INVENTORY

FOR THE LAND-USE CHANGE

AND FORESTRY SECTOR

TABLE 4-3 CARBON EMISSIONS DUE TO

WOODY BIOMASS STOCKS

CHANGES IN FOREST AND OTHER

PAGE 107

Categories Tg C

2 Annual C release from total biomass consumption from stocks 15.47

SECTION 4

TABLE 4-4TOTAL CARBON EMISSIONS DUE

TO FOREST AND GRASSLAND

CONVERSION

PAGE 108


SECTOR ASSESSMENT

(i) Carbon emitted by burning aboveground biomass (immediate emissions, occurring in the year of conversion).

(ii) Carbon released by decay of aboveground biomass (delayed emissions, occurring over a ten-year period).

(iii) Carbon released from soil (delayed emissions, occurring over a 25- year period).

It is estimated that about 448 kha of forests including 420 kha of dry forests were converted, mainly for agriculture purposes, in the inventory year. Three activities causing GHGs emissions from forest and grassland conversion are (i) on-site and off-site burning of biomass, (ii) decomposition process, and (iii) soil. Total carbon released from forest and grassland conversion is presented in Table 4-4.

1 Carbon released from on-site burning of biomass 3.68

3 Carbon released from decay of aboveground biomass 2.40

Total annual carbon release 23.75

On-site burning of Forests

Based on the quantity of GHG released from on-site burning of biomass, trace gas emissions from burning of cleared forests can be estimated. The quantities of three non-CO2 trace gases were estimated as follows:

CH4 58.9 1,237

N2O 0.4 124

NOx 14.6

Abandonment of Managed Lands

Here carbon uptake is estimated for abandoned lands that are regenerating. Carbon uptake occurs in vegetation as well as soil. Four sets of calculations are used to produce estimates of CO2 removals.

(i) Annual carbon uptake in aboveground biomass, on land abandoned in the last 20 years.

(ii) Annual carbon uptake in soils on land abandoned in the last 20 years. (iii) Annual carbon uptake in aboveground biomass on land abandoned

(iv) Annual carbon uptake in soil on land abandoned for between 20 for between 20 years and a hundred years.

years and a hundred years.

VIET NAM

Categories Tg C

2 Carbon released from off-site burning of biomass

4

0.62

Carbon release from soil 17.05

Gases Total (Gg) CO2- equivalent (Gg)

-

SECTION 4

It is estimated that about 100,000 ha was abandoned over the last 20 years, which is regenerating. However, due to lack of data, annual carbon uptake in both aboveground biomass and soils in abandoned land for between 20 years and hundred years were not estimated for this inventory. Table 4-5 indicates the total of carbon uptake from abandoned managed lands.

1 Annual C uptake aboveground biomass in abandoned land, 20 years

0.1 9

NA 3 Annual C uptake aboveground biomass in abandoned land, > 20 years

Total C uptake from abandoned lands 0.29

Total GHG Emissions from Land-use Change and Forestry Sector

Emissions from the sector were calculated, according to the method proposed by IPCC, for the year 1993. Total of CO2 emissions (excluding non- CO2 GHG emissions) from the sector was more than 29.8 million t, including the following sources:

(i) Changes in forest and other woody biomass stocks, (ii) Forest and grassland conversion, and (iii) Abandonment of managed lands.

Although 57.2 Tg of CO2 was removed from the atmosphere by these forestry activities, the sector still contributed 29.9 Tg of CO2 (excluding non- CO2 GHG emissions) to the total of national GHG emissions in 1993. Table 4-6 shows the total carbon dioxide uptake/emissions from the sector in 1993.

–56.15 1 CO2 uptake from changes forest and other woody biomass stocks

1.36 3 Non-CO2 gas emissions (trace gases) in terms of CO2- equivalent

31.24 Total net CO2 emissions including non-CO2 trace gases, CO2 equivalent terms

VIET NAM


SECTOR ASSESSMENT

TABLE 4-5 CARBON UPTAKE IN

“ABANDONED MANAGED

LANDS”

TABLE 4-6 TOTAL FORESTRY SECTOR CARBON

DIOXIDE EMISSIONS, 1993

PAGE 109

Categories Tg C

2 Annual C uptake aboveground biomass in soil, < 20 years 0.10

4 Annual C uptake aboveground biomass in soil, > 20 years NA

Total emissions Tg CO2

Module

2 CO2 emissions from forest and grassland conversion 87.08

4 C uptake (CO2 equivalent) in abandonment of managed lands –1.05

SECTION 4 FORESTRY AND LAND-USE CHANGE

SECTOR ASSESSMENT

The main factors contributing to the estimated carbon emissions in the sector are deforestation and forest degradation, including shifting cultivation, and clearing for agricultural purposes in the country. With three million people practicing shifting cultivation, forests are still the main source of fertile land for cultivation of essential food crops, and this causes forest degradation in Viet Nam. In addition, in order to satisfy short-term needs and create immediate benefits, forest resources are being exploited heavily. It is estimated that more than 30 Tg of wood in dry matter is being extracted from forests annually. This factor also leads to forest loss in the country.

CO2 emissions from the forestry and land-use change sector in 1993 was 29.8 Tg excluding non-CO2 gas emissions (trace gases). The sector accounted for about 25 percent of national CO2 emissions. Figure 4-1 illustrates the percentage of total GHGs emissions (in CO2-equivalent in different sectors in Viet Nam in 1993.

FIGURE 4-1 TOTAL GHGs EMISSIONS (CO2

EQUIVALENT) BY SECTOR IN

1993

4.2.5 BASELINE SCENARIO

PROJECTION OF SECTORAL


TABLE 4-7 VIET NAM FOREST AREAS,

1994 - 2020, KHA

PAGE 110

The land-use change and forestry sector has a large potential for reducing GHG emissions through enhancing carbon sinks in the country as well as protecting the environment. The 5-year plan of the Viet Nam Government sets several targets for protecting the existing natural forest areas as well as forest plantation. One target is to develop watershed protection forest and plantation in order to increase forest coverage rapidly to over 40 percent of the land in the next decade. It is also proposed to accomplish the promotion of sedentary farming and settlement throughout the country by the year 2000.

under forests and plantations is projected to increase by year 2020. The increase in plantations (from 900 kha to 7,500 kha ) will be particularly important.

According to the Government’s plan, as shown in Table 4-7, the area

Plantation 900 3,700 7,000 7,500

Natural forest 8,630 8,500 9,000 9,500

Savanna and waste land 10,123 6,900 3,000 2,000

Source: Ministry of Agriculture and Rural Development, 1996.

VIET NAM

Categories 1994 2000 2010 2020

Total 19,653 19,100 19,000 19,000


SECTOR ASSESSMENT

The Government plan for the forestry sector (as given in Table 4-7) and the Master Plan of the MOARD were the references used to develop GHG emissions projections in the sector. Figure 4-2 presents CO2 emissions projections made for Viet Nam up to year 2020. CO2 emissions are projected to decline from 29.8 Tg in 1993 to 4.2 Tg in the year 2000. However, no net emissions are projected for the years 2010 and 2020. Instead a net sequestration of 21.7 Tg by 2010 and 28.4 by 2020 are projected. This projected reduction in CO2 emissions (or in fact net sequestration) is mainly due to the large projected increases in plantation area as well as conservation of natural forests (Table 4-7).

FIGURE 4-2 PROJECTIONS OF GHGs EMISSIONS IN LAND-USE CHANGE

AND FORESTRY SECTOR

(i) The specified decomposition period is too long compared to that observed in the country, and much of the required data is not readily available.

biomass. This is critical for Viet Nam because there are about 1.1 mha of bamboo forests with five main species that have completely different stem morphologies. Given the importance of bamboo in the Viet Nam economy, mitigation assessment in this ecosystem requires a better method for estimating the bamboo emissions/uptake.

(iii) The methodology covers base year emissions only, while mitigation assessment requires estimates of carbon flows arising from deforestation reduction and/or reforestation activities.

(iv) Data collected from official statistics, including wood harvest, exports, and imports may often be incorrect. Hence one needs to use expert judgment to adjust the information collected.

(v) Due to lack of data, several IPCC default values and coefficients are used for estimating GHGs emissions/uptake in the sector. In particular, several default values provided by the IPCC in the forest and grassland conversion section may not be appropriate for Viet Nam. It should be verified by national forestry experts for future GHGs emissions inventories.

(ii) The methodology does not offer expansion factors for hollowed

Based on IPCC Guidelines, the 1993 National GHGs inventory has been conducted in Viet Nam. With more than 31 mt of CO2-equivalent emitted from

VIET NAM


4.2.7 CONCLUSIONS

PAGE 111

SECTION 4

4.3 SECTOR GHGs

4.3.1 INTRODUCTION

ABATEMENT OPTIONS

PAGE 112


SECTOR ASSESSMENT

the land-use change and forestry sector, the sector contributed 25 percent of total GHGs emissions in the country.

In order to implement the inventory, the IMH, in cooperation with FSI and other concerned agencies, made efforts to collect both activity data and data that describe various biological and chemical parameters associated with land use. However, several data were difficult to gather or measure, so IPCC default values were used for estimation of CO2 emissions/uptake in the sector.

For updating the GHGs inventory for future, it is necessary to :

(i) study the approach and methods of IPCC guidelines; (ii) strengthen the GHGs inventory team, including key persons from

several institutions such as General Statistical Office, Development Strategy Institute, Forestry Inventory and Planning Institute, and MOARD;

(iii) verify and improve GHGs source and sink coefficients. Particularly, improve estimated coefficients for forestry and land-use change activities proposed by the IPCC, and evaluate the applicability of these coefficients to known or expected Viet Nam conditions.

(iv) develop a National GHGs Inventory Plan focused on implementation of the first National Communication on GHGs Inventory and those carried out in 1998. The base year for the next inventory will be 1994.

Forests and forestland occupy about two-thirds of the total area of the country. It is a main asset and provides most of the work opportunities for more than 24 million people belonging to some 50 ethnic groups, who live in or close to the forests. Forests and forestland are also most important factors contributing to environmental balance.

vegetation of Viet Nam was estimated at 14.3 mha in 1943, corresponding to a forest coverage of 44 percent (Project VIE88 - 037,1991). From LANDSAT satellite image interpretation, the results of the inventory in 1993 indicated that the area covered by woody vegetation (tree species and bushes) was 9.3 million ha, corresponding to a forest cover of 28 percent (FIPI, 1993).

During the past five decades, Viet Nam’s forests have degraded. The forest

Causes of forest loss in the country are:

Heavy exploitation of the forest resources. Shifting cultivation practiced by about 3 million people living in mountainous areas or highland. Forestland conversion to cultivated land due to population growth and illegal immigration. Forests were also destroyed because of chemical warfare. It’s estimated that about 1.2 mha were lost in the 1960s and 1970s.

The Viet Nam Government has made strong efforts in both reducing deforestation and increasing reforestation in the country in the past 30 years. With a number of forestry projects, including the achievements in tree planting, forest protection, fixed cultivation, and encouragement of sedentary farming and settlement, during recent years losses of forest have been reduced. Deforestation now stands at about 100,000 ha a year, down by 50 percent from previous levels.

VIET NAM

SECTION 4

In order to restore forests and enhance carbon sinks in the forestry sector, there are many measures that require different investments as well as certain socioeconomic conditions.

The national GHGs inventory in 1993 showed that the GHGs emissions, including non-CO2 trace gases (in CO2 -equivalent terms), from the forestry and land-use change sector accounted for 25.4 percent of the total GHG emissions (in CO2-equivalent terms) in Viet Nam. Although there was an uptake of 57 Tg CO2 by forest vegetation, a number of activities such as clearing forest, shifting cultivation, logging, etc., led to 87 Tg CO2 emissions into atmosphere. As a result, the total net CO2 emissions in the sector was 29.9 Tg, accounting for one-third of the total CO2 emitted in 1993.

Developing and assessing feasible forestry GHGs mitigation options is one of main tasks of the ALGAS Project in Viet Nam. The COMAP model has been used for developing and evaluating forestry GHGs mitigation options.

According to Viet Nam’s forestry condition, in order to enhance carbon pools as well as to meet biomass demand in the country, four main mitigation options have been considered.

(i) Reforestation. (ii) Enhanced natural forest regeneration. (iii) Forest protection. (iv) Scattered tree planting.

Forestry mitigation options have been matched with land categories in the country. Table 4-8 describes the area under each land category actually suitable and available for the forestry mitigation options.

Forest Long/Short Enhanced Protection Scattered

Rotation (on forest Tree Reforestation Forest land and Planting

Generation waste land)

Waste land/Savannas

1. Woody 3,183 400 1,100 283 1,000 400

6,690 2,000 1,000 2,224 1,000 466 2. Shrub and grass

3. Rocky 628 0 0 628 0 0

Nature forest

1. Evergreen 1,335 0 0 1,335 0 0

2. Secondary 4,625 0 0 4,625 0 0

3. Young 1,275 400 300 475 0 100

4. Mixed 1,017 553 300 64 0 100

Plantations 900 0 0 900 0

Source: Ministry of Agriculture and Rural Development, 1996.

VIET NAM


SECTOR ASSESSMENT

TABLE 4-8 POTENTIAL AREAS FOR FORESTRY

MITIGATION OPTIONS

PAGE 113

Land Categories

Total Land Area

Forestry Mitigation Options

Area Covered to Agriculture and Others

Natural

Group A

Group B

Group C

Total 19,653 3,353 2,700 10,534 2,000 1,066

SECTION 4

TABLE 4-9 GOALS AND MAIN BENEFITS OF

FORESTRY MITIGATION

OPTIONS

PAGE 114


SECTOR ASSESSMENT

Potential benefits of forestry mitigation options including non-GHGs

As shown in Table 4-8, the area actually available for forest protection options

Besides 3.3 million ha to be planted through reforestation options, there will

environmental and socioeconomic benefits are indicated in Table 4-9

is large in the country and accounts for about 54 percent of forestland.

be 2.7 mha of forestland to be protected by means of carrying out enhanced natural regeneration options. Actually, economic benefits and biodiversity conservation achieved by enhanced natural regeneration options are often better than those achieved by reforestation.

In recent years, the rate of reforestation increased from year to year. Every year 100,000 ha of forest and 500 million scattered trees are planted. As a result, the deforestation rate is now reducing by 50 percent from the previous level.

Enhancing Carbon sinks. Improving local environment. Rural income generation.

Protecting environment Providing industrial woods, Provision of employment for sawn wood and fuel wood.

Temperateness of regional Electricity generation Raising public awareness of climate environmental protection

local people

Carbon sequestration. Improving local environment Rural income generation

Biodiversity conservation Biodiversity conservation Low investment

Protecting the gene sources of the vegetation and animals in the forest

Supply of timber product and non-timber product

Protection of local culture

Conservation of Carbon Reducing carbon emissions Lower endowment Sinks

Slowing deforestation Biodiversity conservation National conservation area

Biodiversity conservation

Protection of National parks and

Enhancing carbon pools Slowing deforestation Rural income generation

Providing fuel wood Public service

Up to the year 1996, the reforestation rate is greater than deforestation. According to the Government plan, 5 mha of forest will be planted during 1996 - 2010 (MOARD, 1997). Besides, a policy named “Stop logging in natural forests for a given period” will come into effect soon. Under this policy, such activities as logging, timber, etc. would be strictly banned in the areas of natural forest. Therefore, the rate of natural regeneration will be increased dramatically in the next period.

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Global Goals National/Local Goals Benefit

1. Reforestation

2. Natural Regeneration

3. Forest Protection

4. Scattered Tree Planting

SECTION 4

1. The Comprehensive Mitigation Analysis Process (COMAP) model is used for developing and assessing forestry mitigation options. The steps are:

(i) Assess the potential and cost-effectiveness of forest protection or conservation options (FORPROT model).

(ii) Assess the potential for carbon sequestration or woody biomass production and its cost-effectiveness of carbon sequestration or emissions reduction (REFOREST model).

supply/demand, or develop land-use or forestry strategy to meet the biomass requirement of a region or country (BIOMASS model).

(iv) Estimate the potential for bioenergy-technology-based bioelectricity generation for a given extent of land availability and efficiency of conversion, as well as estimate carbon emissions avoided and the potential for fossil fuel electricity substitution through generation of bioelectricity (BIOENER model).

In order to provide information on the financial costs, net present value (NPV) of benefits of forestry options, and changes in carbon stocks annually under different scenarios, REFOREST and FORPROT models were applied, in which 1994 was chosen as a base year. Activity data was mainly collected from General Statistical Office and Forest Science Institute, Forest Inventory and Planning Institute- MOARD, and Development Strategy Institute - Ministry of Planning and Investment (MPI). The costs and inputs used in the COMAP for each option are given in Appendix A4-6, while the COMAP outputs are presented in Section 4.3.4.

(3) Several forestry options were developed and evaluated in an attempt to reduce sources of GHGs and to maintain and expand sinks of GHGs in the country. In all analysis, a value of 10 t/ha for the wasteland was used to estimate dry weight of vegetation carbon with carbon density of 0.5, and a value of 50 tC/ha was assumed for amount of carbon stored in the soil. For the mitigation, values of 0.65 tC/ha-yr for reforestation, 0.5 tC/ha-yr for scattered trees, and 1 tC/ha- yr for enhanced natural regeneration were used to define amount of carbon stored in soil. A value of 5 years for the decomposition period and a value of 10 tC/ha-yr for the amount of decomposition carbon were used. For discount rate, a value of 10 percent was applied.

Recently, a plan was developed by the Vietnamese Government in which

(iii) Assess the impact of any forest mitigation option on biomass

2.

5 mha of forest and 6 billion scattered trees will be planted in the period 1996– 2010. The plan has been submitted to the National Assembly for approval. The objectives of the plan are to ensure the proper utilization of natural resources, avoid soil erosion and flood hazard, and protect the environment.

mha of protection forest will be planted. In addition, local households will plant 6 billion scattered trees approximating to 2.5 mha.

options, their goals, and main benefits of the options are indicated in Table 4-8

According to the plan, 5 mha including 3 mha of production forests, and 2

As mentioned in section 4.3.1, potential land areas relevant to mitigation

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SECTOR ASSESSMENT

4.3.2 MITIGATION OPTION

ASSESSMENT METHODOLOGY

4.3.3 SUMMARY OF MITIGATION

OPPORTUNITIES

PAGE 115

SECTION 4

4.3.4 ASSESSMENT OF MITIGATION

OPTIONS

4.3.5 COMPARATIVE ASSESSMENT

OF MITIGATION OPTIONS

PAGE 11 6


SECTOR ASSESSMENT

and Table 4-9. From a GHGs accounting perspective, forestry options can be divided into three classes of benefits:

(i) Reduce sources of GHGs. (ii) Maintain sinks of GHGs. (iii) Expand sinks of GHGs.

The forestry mitigation options aim at carrying out reforestation and forest protection at the country level in the attempt to reduce carbon emissions as well as enhance carbon sinks. Enhancement of natural regeneration and protection of degraded forests would also be potential options.

To slow the deforestation rate, as well as meet a part of local biomass demand, the scattered tree planting option was developed and assessed. However, it is noted that it will be very difficult to meet the Government’s targets, in which 5 additional ha of new forest will be established by 2010 and most existing natural forests will be protected by 2020. Therefore, the Government plan is considered as a Technical Potential scenario. The two other scenarios: (i) Baseline and (ii) Feasible scenario were also developed and assessed. The three scenarios will be discussed in section 4.4.2

COMAP models are used as analytical tools for assessing the performance, costs, and benefits of the mitigation options, as well as for estimation of the emissions reduction or carbon sequestration potential per unit area of each mitigation option.

One of the main steps of the forestry options assessment is to estimate land availability in the country for each forestry option. Table 4-8 in Section 4.3.1 shows potential areas available for the options. However, due to several reasons such as socioeconomic conditions, financial sources, feasibility, etc., only a part of the available areas may be used for forestry mitigation options. With regard to forest protection, apart from a few areas of natural forest in high mountain or remote areas, almost all natural forests face deforestation. Thus, nearly all existing natural forests need protecting. This becomes more suitable when the policy “Stop logging in natural forests for a given period” comes into effect soon.

The categories of mitigation options and the size of the area allocated for each option annually under the feasible scenarios are shown in Table 4-10.

Five forestry mitigation options are developed under the feasible scenario as follows:

(i) Enhanced natural regeneration of 1.85 mha of degraded forest areas. (ii) Reforestation of 2.2 mha, including 1 mha under long rotation and 1.2

mha under short rotation. (iii) Protecting 6.5 mha of existing forests. (iv) Planting 4 billion scattered trees.

By implementing the above options, the forestry sector could increase forest coverage from 26 percent at present to 45 percent by the year 2020.

COMAP models are used for assessing and evaluating forestry mitigation options under three scenarios based on different silviculture measures. The forestry mitigation options have been developed relating to reforestation,

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SECTION 4

1,200 90.0 Short rotation Reforestation

Long rotation Reforestation

Waste land / Savannas and Degraded forest land

1,000 40.0

Waste land, Urban / Farm land Scattered trees 1,650 44.0

enhanced natural forest regeneration, scattered tree planting, and forest protection in the country in the period 1994-2020.

Under the feasible scenario, the long rotation reforestation option showed the lowest mitigation potential with 67.5 Tg C abated whereas the existing natural forest protection option demonstrated the greatest potential, with 680.2 Tg C abatement, accounting for 69 percent of total carbon abated.

As can be seen from Table 4-11, it is found that forest protection is the option with the lowest endowment cost and the highest mitigation potential. In term of present value of benefit, apart from the long rotation reforestation option, the other four options have a positive value, in which the highest value is estimated for the scattered trees option, with the benefit of $409 per hectare. The long rotation reforestation option gave a negative net present value (NPV) because of the long period of investment, low domestic market price, and the Government’s recent policy to ban raw wood export. Thus, wood prices in the country may be affected in the next decades.

For investment cost, the enhanced natural regeneration and existing natural forest protection options required lower costs, while the reforestation options with both long and short rotation required higher cost (Table 4-11). Figure 4-3 illustrates the mitigation potentials of the options in terms of total of carbon abated per hectare. Figure 4-4 shows the life-cycle cost ($/tC abated) required to implement the each option until 2020.

the lowest life-cycle cost with the value of $0.4 /tC abated. On the contrary, the short rotation reforestation option (SRR) required the highest life-cycle cost with the value of $3.5 /tC abated.

under both baseline and technical potential scenarios, 11 forestry options, including 5 options of the baseline scenario, were developed and assessed through COMAP model. The total area under each option and its COMAP outputs are presented in Table 4-12.

As shown in Figure 4-4, the existing forest protection option (FP) offered

For comparison of the costs, benefits, investment, etc. of forestry options

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SECTOR ASSESSMENT

TABLE 4-10 MITIGATION OPTION CATEGORY

AND THE SIZE OF AREA

ALLOCATED ANNUALLY FOR

EACH OPTION UNDER FEASIBLE

SCENARIOS

PAGE 117

Natural forest land Forest protection and conservation

6,500 -

Waste land / Savannas and Natural forest land

Enhanced natural regeneration

1,850 68.5

Land categories Option category Target area kha

Rate of planting kha/yr


SECTOR ASSESSMENT

FIGURE 4-3 MITIGATION POTENTIALS OF

FEASIBLE SCENARIO

FORESTRY OPTIONS UNDER THE

FP: Forest Protection LRR: Long Rotation Reforestation SRR: Short Rotation Reforestation ST: Scattered Trees ENR: Enhanced Natural Regeneration

FIGURE 4-4

MITIGATION OPTIONS UNDER THE

FEASIBLE SCENARIO

LIFE-CYCLE COST OF FORESTRY


PAGE 118 VIET NAM


SECTOR ASSESSMENT

TABLE 4-11 COMPARATIVE ASSESSMENT OF

FORESTRY MITIGATION OPTIONS. Sum of annually created

t of C abated/ha incremental pool per ha, 47.2 67.5 59.8 104.7 64.3 48.4

$/tC 0.7 1.7 3.2 0.1 0.2 0.9

$/ha 31.5 75.4 11 4.2 10.0 10.0 38.4

$/tC abated 0.9 1.9 3.5 0.4 0.7 1.0

$/ha 40.0 85.1 125.5 41.6 41.9 46.2

$ NPV/tC 0.8 -1.2 9.9 0.8 1.5 9.2

$ NPV/ha 34.2 -55.5 353.9 85.3 96.0 409.1

a b

Tectona, Pine, and other indigenous hard wood. Eucalyptus sp., Bamboo, Acacia sp.

Enhanced Natural regeneration 1.1 51.9 44.0

Short Rotation Reforestation 0.9 53.8 113.0

Long Rotation Reforestation 0.8 54.0 68.1

Scattered Trees 1.2 58.1 55.4

Forest Protection 2.4 251.3 99.8

Degraded Forest Protection - - -




Scattered Trees 2.5 121.0 11 5.5


Degraded Forest Protection 3.1 201.4 129.9




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TABLE 4-12 TOTAL AREA, MITIGATION

POTENTIAL, AND INVESTMENT

COST OF IDENTIFIED MITIGATION

SCENARIOS

OPTIONS UNDER THE DIFFERENT

PAGE 119

Main indicators

Enhanced Long Natural rotation

regeneration plantationa

Short Natural rotation forest

plantationb protection

Degraded Scattered forest tree

protection planting

1. Mitigation potential

2. Initial cost:

3. Life-cycle cost:

4. Cost-benefit analysis:

Feasible Scenario

Technical Potential Scenario

Baseline Scenario

Mitigation Option Total Area

Mha

Total Mititgation Potential

mtC

Total Investment

Cost $ million

SECTION 4

4.4 BASELINE AND LEAST- COST ABATEMENT

SCENARIOS TO 2020 4.4.1 APPROACH AND

METHODOLOGY

4.4.2 SCENARIO ASSUMPTIONS

PAGE 120


SECTOR ASSESSMENT




In order to analyze forestry mitigation options at the country level along with the relevant environmental aspects and financial benefits, the COMAP models were utilized.

The two models: (1) FOR - PROT and (2) REFOREST of COMAP models were used in Viet Nam. FOR - PROT model was utilized for assessing the potential and cost-effectiveness of forest protection options while REFOREST model was applied for assessing the potential and cost-effectiveness of reforestation options under both long and short rotation periods. It was also used for evaluating enhanced natural generation and scattered tree options. All forestry options under Baseline, Technical Potential, and Feasible Scenarios were developed and analyzed through the model.

In general, the models are useful for assessing the mitigation potential of the forestry sector through a set of identified forestry mitigation options. However, several values inputted into the COMAP model, such as soil carbon densities and the rate of carbon accumulation under different forest areas, should be verified and improved for the next study.

So far, there are four activities conducted in the forestry sector in Viet Nam, namely reforestation/afforestation, natural regeneration, forest protection, and scattered tree planting. Based on Viet Nam's socioeconomic conditions and the rate of forest rehabilitation, the following scenarios have been developed.

(1) Baseline scenario: It is assumed that the rate of annual forest rehabilitation during the period 1994-2020 would be 100,000 ha, approximating the average rate of forest rehabilitation in the last ten years. The rate of deforestation would be 50,000 ha per year, down by 50 percent from the existing level. The survival rates for reforestation programs vary. However, in the COMAP analysis it was assumed that the survival rate was 100 percent. For forest protection activities, under this scenario only 2.4 mha of existing protection forests shall be conserved in the period.

Government policy for reforestation and natural regeneration, about (2) Technical potential scenario: It is assumed that based on the

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Feasible Scenario


Mha

Total Mitigation Potential

mtC

Total Investment

Cost $ million


SECTOR ASSESSMENT

5 million additional ha and 6 billion scattered trees would be planted in the country in the next decade, in an attempt to increase the cover rate of forest and perennial trees from 28 percent at present to 45 percent in 2010. The rate of reforestation would be 300,000 ha per year. Deforestation would be stopped by means of implementing the “Forest-door closure” policy in which logging, timber, etc. in existing natural forests will be prohibited in a given period. In addition, 3.1 mha of degraded forests would also be protected, and 2.7 mha of degraded forest areas would be under natural regeneration.

(3) Feasible scenario: Under this scenario, levels of implementation of several forestry options are assumed to be higher than in the Baseline scenario but lower than in the Technical potential scenario. This scenario, actually, is considered to be more feasible than the technical potential scenario because of several existing socioeconomic and technological conditions in the country. It is assumed that the rate of reforestation would be about 140,000 ha per year and 4 billion scattered trees would be planted during the period of 1994-2020, while 6.5 mha of exiting natural forests would be protected. In addition, about 1.9 mha of degraded forest areas would be under enhanced natural regeneration in the whole period.

Table 4-13 indicates main scenario assumptions in the period 1994-2020.


Urban; percent 0.2 0.3 0.6

Forest; percent 29.9 33.4 48.9

Agricultural; percent 22.2 24.4 26.6

Wasteland; percent 42.2 35.8 15.6

Rangeland; percent

Other; percent 5.4 6.1 6.4

Industrial & construction GDP percent 30.0 35.5 41.5 44.0

Service GDP percent 41.7 42.0 43.0 43.9

Agricultural GDP percent 28.4 22.4 15.5 12.1

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Land Area; (Thousand hectares) 33,099 33,099 33,099 33,099

Population 72.5 81.3 95 105

Scenario Asumptions 1994 Base Year

2000 2010 2020

GDP 1994 $ billion 15.52 26.05

Estimated Share of the Informal Sector in

the Economy in GDP (percentage)

GDP per capita 1994 $ 214 322

Urban population as percentage of total population 19.9 30

55.21 108.60

587 1025

40 55


SECTOR ASSESSMENT

4.4.3 BASELINE AND TECHNICAL

POTENTIAL SCENARIOS

PAGE 122

For the Baseline scenario, as mentioned in the previous section, the government policy is assumed to be implemented, in which 5 million additional ha and 6 billion scattered trees will be planted by 2010. However, if the government policy is used as a baseline, no additional mitigation actions can be taken for many years to come. The Baseline scenario, in Viet Nam’s case, is considered as the Likely trends scenario. Under this scenario, the rate of annual reforestation would be about 100,000 ha until 2020, approximating the average rate in the last 10 years. The survival rates for reforestation programs were assumed to be 100 percent in the COMAP analysis. However, the deforestation rate would continue to be on the average of 50,000 ha per year over the period 1994-2020. As a result, the area of existing forests, particularly natural forests, would reduce from 8.2 mha in 1994 to 6.9 mha in 2020. The following forestry options were developed under the Baseline scenario and were assessed by the model.

(i) Enhanced natural regeneration of 1.1 mha of degraded forest areas including 0.6 million ha of young and mixed forests (ENR1)

(ii) Reforestation of 0.8 mha of degraded forest areas under 27-year rotation period (LRR1)

(iii) Reforestation of about 1 mha of degraded forest areas under 10-year rotation period (SRR1)

(iv) Conservation of 2.4 mha of protection forests (FP1) (v) Planting 3 billion scattered trees (ST1)

The Technical Potential scenario was developed based on the Government’s policy. In fact, in the past 30 years, areas planted in trees total about 1 mha. Deforestation still remains a problem which must be solved in the coming years. Thus, it is very difficult to achieve goals of the policy by 2010. The policy, however, can be considered as a Technical potential scenario in Viet Nam. Under this scenario, 6 forestry options were developed and analyzed by the COMAP model.

(i) Enhanced natural regeneration of 2.7 mha of degraded forest areas including 0.6 mha of young and mixed forests (ENR2)

(ii) Reforestation of 1.4 mha of degraded forest areas under 27-year rotation period (LRR2)

(iii) Reforestation of 1.9 mha of degraded forest areas under 10-year rotation period (SRR2)

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Scenario Assumptions 1994 Base year

2000 2010 2020

Livestock Population (mill. heads) 6.4 7.4 9.4 11.9

CO2 Emissions Intensity per GDP (kgC/$) 1.43 1.96 2.66 3.02

CO2 Emissions Intensity per capita (kgC/person)

0.29 0.57 1.12 1.85

Discount Rate percent 10 10 10 10

SECTION 4

(iv) Protection of 7.4 mha of forest areas (FP2) (v) Protection of 3.1 mha of degraded forest areas (DFP2) (vi) Planting 6 billion scattered trees in the country (ST2)

COMAP results for the options developed under both the Baseline and Technical Potential Scenarios are presented in Table 4-11.

A number of mitigation options could be assessed based on several criteria such as available land areas, socioeconomic situations, and political conditions. In general, both baseline and mitigation scenarios depend on the demands exerted on the forest resources of both wood products and other land uses.

Under the Feasible scenario, the rate of reforestation would be about 140,000 ha per year in the period of 1994-2020. Protection of 8.4 mha of existing forests, including 1.9 ha of degraded forests under enhanced natural regeneration, would be included in this scenario. Four billion scattered trees would be planted by 2020. The forestry mitigation options under this scenario are developed as follows:

(i) Enhanced Natural Regeneration (ENR3)

Since this option will carry out enhanced natural regeneration of 1.85 mha of degraded forest areas, including 400,000 ha of young and mixed forests, the estimated NPV of benefits will be $0.8/tC or $34.2/ ha. There can be abatement of 87.3 Tg of carbon emissions.

(ii) Long Rotation Reforestation (LRR3)

Each year, 40,000 ha of waste or degraded lands will be planted with a 27-year rotation period. Under this option, 1 mha will be developed into forest plantation resulting abatement of 67.5 Tg of carbon emissions while NPV of benefits will be $ –1.2/tC or $ –55.5/ha.

(iii) Short Rotation Reforestation (SRR3)

Each year, 90,000 ha of waste or degraded lands will be planted with a 10-year rotation period. Under this option, 1.2 million ha will be reforested, resulting an abatement of 71.7 Tg of carbon emissions, while NPV of benefits will be $9.9/tC or $353.9/ha

(iv) Forests Protection (FP3)

This option will conserve 6.5 mha of existing natural forests. The estimated NPV of benefits will be $0.8/tC or $85.3/ha. Under this option, there can be abatement of 680.2 Tg of carbon emissions.

(v) Scattered Trees (ST3)

This option will plant scattered trees at the average rate about 60,000 ha per year in equivalent. The estimated NPV of benefits will be $9.2/tC or $409.1/ha. Under this option, there can be abatement of 79.9 Tg of carbon emissions.

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SECTOR ASSESSMENT

4.4.4 FEASIBLE SCENARIO

PAGE 123

SECTION 4

4.4.5 IMPACTS OF THE BASELINE, TECHNICAL POTENTIAL, AND

FEASIBLE SCENARIOS

PAGE 124


SECTOR ASSESSMENT

A number of cost-effectiveness indicators generated by the model, such as NPV of benefits, initial cost, mitigation potentials, and life-cycle cost for each above option can be found in Table 4-11.

GHGs emissions/removal from the forestry sector has been estimated for the period 1993-2020, based on master plan of MOARD and the recent government plan. By carrying out several low-cost and most effective mitigation options, the sector will play an important part in reducing total CO2 emissions as well as enhancing carbon sinks in the country.

Generally, implementation of the scenarios has a positive impact on socioeconomic conditions. It can provide employment for local people as well as attract them to reforestation and forest protection activities. It is estimated that about 350,000 people can be employed under the Baseline scenario. The employment potential of the Feasible scenario is estimated at 616,000 people, and it is estimated that 912,000 local people can be provided with employment under the Technical Potential Scenario.. This means that the scenarios, in the attempt to halt deforestation in forest and mountainous areas, can generate income for the poor, particularly for several ethnic groups who are living in the forests and practicing shifting cultivation.

With regard to the environment, the implementation of reforestation, afforestation, enhanced natural regeneration, and forest protection will contribute an important part to conservation of water resources, biodiversity, and improvement of soil condition.

The COMAP outputs indicate that the amounts of carbon abated under the Baseline, Technical Potential, and Feasible scenarios in the period 1994- 2020 would be 469 Tg, 1,433 Tg, and 987 Tg, respectively. Total areas required for planting, regeneration, and protection in the period would be 6.4 mha, 19.0 mha, and 12.2 mha for the Baseline, Technical Potential, and Feasible scenarios, respectively. The life-cycle costs required would be about $380 thousand million for the Baseline scenario, $1,019 thousand million for the Technical Potential scenario, and $657 thousand million for the Feasible scenario. (Table 4-14). The source of investment funds can be from financial benefits generated by baseline activities in the sector. Besides, funding can also be obtained from the State budget for reforestation and forest protection programs in the years to come, supporting the attempt to increase forest areas in the country up to 14 mha by 2010.

From the three scenarios, it can be seen that most forestry options have positive present value of benefits, excluding long rotation reforestation options. It means that the activities can generate benefit to compensate cost. In terms of life-cycle cost, it was found that forest protection has the least cost at $ 0.4 per t of carbon abated in the three scenarios. The relationship between cumulative carbon abatement and cost per t carbon abated under the three scenarios is presented in Figure 4-5.

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SECTOR ASSESSMENT

FIGURE 4-5A

COST OF CARBON ABATEMENT

ABATED UNDER BASELINE

SCENARIO

AND CUMULATIVE CARBON

FIGURE 4-5B


ABATED UNDER TECHNICAL

POTENTIAL SCENARIO


FP: Forest Protection DFP: Degraded Forest Protection LRR: Long Rotation Reforestation SRR: Short Rotation Reforestation ST: Scattered Trees ENR: Enhanced Natural Regeneration

FIGURE 4-5C


ABATED UNDER FEASIBLE

SCENARIO


FP: Forest Protection DFP: Degraded Forest Protection LRR: Long Rotation Reforestation SRR: Short Rotation Reforestation ST: Scattered Trees ENR: Enhanced Natural Regeneration

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SECTOR ASSESSMENT

In order to assess cost-effectiveness of the forestry mitigation options under the Feasible scenario, the values of NPV were calculated in terms of t of carbon abated per ha under each option. Priority of those options has been identified. The best NPV ($/tC) is given by the short rotation reforestation option (SRR3) with $9.87/tC, the scattered trees option (ST3) comes in second ($9.22/tC), the forest protection option (FP3) takes the third place ($0.81/ tC), and the enhanced natural regeneration option (ENR3) comes in fourth ($0.78/tC). The long rotation reforestation option (LRR3) gave a negative value of –$1.23/tC.

TABLE 4-14

UNDER THE THREE SCENARIOS

MITIGATION POTENTIAL AND COST






Degraded Forest Protection - - 3.1

Total 6.4 469.1 380.3


Short Rotation Reforestation 1.9 241 .0 346.5



Forest Protection 7.4 1,231.3 888.9

Degraded Forest Protection 3.1 1,432.7 1,018.8

Total 19.0 1,432.7 1,018.8







Total 12.2 986.6 656.6

PAGE 126 VIET NAM

Feasible Scenario

Technical Potential Scenario

Baseline Scenario


Mha

Cumulative Mitigation

mtC

Cumulative Investment $ million


SECTOR ASSESSMENT

By implementing the identified mitigation options under the Feasible scenario, the cumulative mitigation potential will be 987 mt of carbon (Figure 4-6). Cumulative life-cycle costs required for adopting the scenario will be $657 million, whereas cumulative NPV of benefits for about 12 mha under this scenario will be $1,679 million. The least-cost strategy for the scenario is given in Figure 4-5c.

Under the Feasible scenario, NPV of benefit obtained by the scattered trees option is the highest with a value of $695 million, while the long rotation reforestation is the opposite with a value of –$56 million. The forest protection option has the highest mitigation potential with 680 mt carbon abated, accounting for nearly 70 percent of the total carbon abated for the scenario. Actually, the option becomes more feasible in the nation because of the recent government policy aimed at conserving existing natural forest in the years to come, in the attempt to protect environment as well as reduce the impacts of climate change.

Figure 4-7 illustrates the total cumulative carbon abated against the cumulative NPV of benefits, while Figure 4-8 illustrates the total cumulative carbon abated against the cumulative life-cycle costs required for adopting the Feasible scenario.

FIGURE 4-6 CUMULATIVE MITIGATION

POTENTIAL OF THE FEASIBLE

SCENARIO

FP: Forest Protection ST: Scattered Trees LRR: Long Rotation Reforestation ENR: Enhanced Natural Regeneration SKR: Short Rotation Reforestation

FIGURE 4-7 CUMULATIVE C ABATED AND

NPV OF BENEFITS UNDER THE

FEASIBLE SCENARIO

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SECTOR ASSESSMENT

FIGURE 4-8 CUMULATIVE C ABATED AND

LIFE-CYCLE COSTS REQUIRED

FOR THE FEASIBLE SCENARIO

4.5 SECTOR LEAST-COST

GHGs ABATEMENT

STRATEGY

4.5.1 GENERAL SECTORAL

ABATEMENT STRATEGY AND

GOALS


IMPLEMENTATION OF

STRATEGY

PAGE 128


The forestry sector has the potential to reduce GHGs emissions and enhance carbon pools in the country. Based on the recent plan of the Government as well as Viet Nam’s socioeconomic conditions, the forestry least-cost GHGs abatement strategy in the period 1996-2020 was formulated. Goals of the strategy are as follows.

Establish a system of protection forest, covering about 8 mha, for the purpose of protecting existing natural forest watersheds, preventing soil erosion, and enhancing carbon sinks. Establish a system of special-use forest, covering about 2 mha, for use as national parks, forest reserves, and cultural sites. Establish 11 mha of production forests. By the year 2010, most of the necessary exploitation would come from planted forests with

Create 5 mha of new forest, in which 1 mha should be established

By extending the forested area as indicated above, the rate of forests coverage should increase to 45 percent of the land surface of the country, leaving only a little hill land bare of tree cover.

only a minor share coming from the natural forests.

by using intensive methods to obtain high productivity.

Short-term (1998 - 2005)

The rate of reforestation is planned to reach about 140,000 ha per year, an increase of 30 percent as compared with the average annual reforestation rate in the past 5 years. In addition, about 1.5 billion scattered trees will be planted and 6.5 mha of existing natural forests will be protected. At the same time,

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SECTION 4

natural regeneration will be allowed in 1.8 mha of degraded forests. As a result, there will be about 1 mha planted in forestland by 2005, contributing to reduction of GHGs emissions from the sector.

Medium-term (2005 – 2015)

Continuing to carry out forest protection options will maintain and improve the important carbon sinks in the country. The average annual reforestation rate will be reduced gradually. From 2005, about 100,000 ha of forest and 200 million scattered trees will be planted annually. It is estimated that by 2015, more than 2 million additional ha would have been planted since 1997, including 1.2 mha of protection forests.

Long-term (beyond 2015)

The rate of reforestation will be 160,000 ha per year. About 1 mha of wasteland will be revegetated by 2020. Natural forests will be protected for the whole period. Before 2020, a number of forest products such as roundwood, timber, etc. from established plantations and some natural forests would be harvested to meet the in-country demand as well as wood export.

Potential carbon sink enhancement and cost of abatement strategy initiatives are shown in Table 4-15.

Forest protection 6.5 342 0.4

0.8 34 0.9 Enhanced natural reforestation

Reforestation 1.0 28 2.8

Planting scattered trees 0.5 31 1.0









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SECTOR ASSESSMENT

TABLE 4-15 SUMMARY OF NATIONAL LEAST-

COST ABATEMENT STRATEGY

SCENARIO

INITIATIVES UNDER FEASIBLE

PAGE 129

Long Term (Beyond 2015)

Medium Term (2005-2015)

Short Term (1998-2005)

GHGs Abatement Initiative

Total Area Mha

Petential Carbon Sink Enhancement

Mt C

Cost of Initiative

$/tC

SECTION 4

4.6 CONCLUSIONS AND

RECOMMENDATION

PAGE 130


SECTOR ASSESSMENT

The result of the 1993 National GHGs Inventory indicate that the main factors contributing to forestry sector carbon emissions are deforestation and forest degradation, including shifting cultivation and clearing for agricultural purposes. In 1993, Viet Nam’s forest was able to uptake 57.2 Tg CO2- equivalent, while the emissions was about 87.1 Tg, excluding non-CO2 GHGs emissions. Total net CO2 equivalent emissions, including non-CO2 trace gases, was 31.2 Tg. It was estimated that net CO2-equivalent emissions would be about 4.2 Tg in the year 2000. However, in the sector no net emissions are projected in the future. Instead, a net sequestration of 21.7 Tg CO2 and 28.4 Tg CO2 are projected in the years 2010 and 2020, respectively. This projected reduction in CO2 emissions (or in fact net sequestration ) is mainly due to the large projected increases in plantation area and conservation of natural forests in the country.

So far, deforestation continues to be a serious problem that must be solved in the years to come. In order to stop logging and maintain existing carbon sinks, forest protection options become more important in the country. The options are considered to be more feasible under the recent policy of the Government aimed at conservation of existing natural forests. Actually, the forest conservation option is normally assessed as the lowest cost and most effective way of reducing carbon emissions.

For the ALGAS study, three scenarios were developed. The Baseline scenario is considered as a Likely trends scenario, whereas the Technical potential scenario is based on the Government’s policy relating to reforestation, afforestation, and natural forest protection in the nation in the next decades. The Feasible scenario, consisting of five mitigation options, is suggested and analyzed. Generally, all of the forestry options under the scenarios were developed and assessed by the COMAP model.

Baseline, Technical Potential, and Feasible scenarios in the period 1994-2020 would be 469 Tg, 1,433 Tg, and 987 Tg, respectively. The NPV of benefits would be $1,009 million for the Baseline, $2,638 million for the Technical Potential, and $1,679 million for the Feasible scenario.

required the total cost of about $657 million, while the total cost required under Baseline scenario is $380 million. However, the implementation of the scenarios has a positive impact on socioeconomic as well as environmental issues. It can provide employment for local people as well as attract them to reforestation and forest protection activities. It is estimated that about 350,000, 616,000, or 912,000 local people could be provided with employment under the Baseline, Feasible, or Technical Potential scenarios, respectively. For environment aspects, reforestation, afforestation, enhanced natural regeneration, and forest protection options will contribute an important part in conservation of water resources, biodiversity, and improvement of soil condition.

Baseline scenario are projected to decline, and in fact there will be a significant carbon sink creation even under the Baseline scenario, due to forest conservation and considerable afforestation planned by the Government.

strategy for development of the forestry sector in which several main issues should be considered, such as: (i) cooperation with other economic sectors,

VIET NAM

The COMAP outputs indicate that the amount of CO2 abated under the

Implementation of the five mitigation options under the Feasible scenario

In general, it is noteworthy that in Viet Nam, the carbon emissions in the

The forestry sector Least-cost GHG Abatement Strategy should follow the

SECTION 4

particularly with agriculture sector, (ii) revision of policies for forestry including land allocation policy, stimulating investment in forestry development, and price stabilization. In addition, raising public awareness and education in environmental protection play an important role for successfully implementing the strategy.

Intergovernmental Panel on Climate Change (IPCC). 1995 “Greenhouse Gas Inventory Reference Manual”.

IPCC. 1995 “Greenhouse Gas Inventory Workbook”.

Hydrometeorological Service of Viet Nam. June 1997. “Viet Nam National Greenhouse Gas Inventory, 1993”. Hanoi, Viet Nam.

Statistical Publish House, 1996. “Viet Nam’s economy the period 1945-1995 and its perspective by the year 2020”. Hanoi, Viet Nam.

Asian Development Bank, 1994. “Climate Change in Asian: Viet Nam”.

General Statistical Office, 1995. “Statistical Yearbook 1995”. Hanoi, Viet Nam.

N.H. Ravindranath and Sandhya Rao. 1996. “Instruction Manual for Developing Forestry Mitigation Options Using COMAP Models”.

Ministry of Forestry, 1990. “Forestry Sector Review - Forestry in Viet Nam.” Hanoi, Viet Nam.

Ministry of Forestry, 1990. “Forestry Sector Review - Tropical Forestry Action Plan, Land use Issues”. Hanoi, Viet Nam.

Jayant Sathaye and Stephen Meyers. “Greenhouse Gas Mitigation Assessment: A Guidebook”. Kluwer Academic Publ. Dordrch.

Le Sau, Nguyen Huy Phon. 1995. “Forest resources assessing monitoring in Viet Nam period 1993 - 1995”. Hanoi, Viet Nam.

Ministry of Forestry, 1991. “Viet Nam Forestry Sector Review, Tropical Forestry Action Programme”.

Ministry of Agriculture and Rural Development, 1997. “Programme on rehabilitation of 5 million ha in the period 1996-2010”. Hanoi, Viet Nam.

General Department of Land Management. 1996. “Report on Viet Nam Land-User toward 2010”. Hanoi, Viet Nam.

VIET NAM


SECTOR ASSESSMENT

REFERENCES

PAGE 131

SECTION 5AGRICULTURE SECTOR

ASSESSMENT

iet Nam is an agricultural country, and 80 percent of its population is involved in agriculture. The sector contributes nearly one-third of the V total Gross Domestic Product (GDP). Agricultural land is about 7.3

mha or 22 percent of the country’s total land area of 33 mha. The Viet Nam agricultural economy is based on food crops, industrial

crops, and livestock husbandry. Within the agriculture sector, the cultivation subsector takes the major part (proportion of production, 73.5 percent in 1993), while livestock husbandry constitutes the rest (Table 5-1).

Food crops, including paddy/rice, maize, sweet potato, cassava, and potato are of predominant importance in Vietnamese agriculture (Table 5-1). This subsector as a whole made up 47 percent of the total GDP of the agriculture sector in 1995 and is the major food source for the people. Gross output of food crops in paddy equivalent increased from 21.5 mt in 1990 to 27 mt in 1995. Paddy, the staple food of the population and one of the major export commodities, is dominant among food crops. Paddy output increased from 19.2 mt in 1990 to 23.5 mt in 1994 and to 25 mt in 1995.

Industrial crops include perennial crops such as rubber, coffee, coconut, and tea, and annual crops such as groundnut, sugarcane, and soybean. Some of these crops are important export commodities.

The livestock subsector has also grown fast in recent years supported mostly by domestic demand (Table 5-1).


BACKGROUND

Animal husbandry 25.6 25.0 26.1 26.5 26.7 27.0

Food crop, percent of total area 78.7 79.1 79.4 78.4 78.2 77.8

Perennial industrial crops, percent 6.0 7.1 6.9 7.2 7.4 7.8

The agriculture sector is an important source of GHGs emissions. Most of this is methane and nitrous oxide. Significant reduction in CH4 emissions from agriculture can be achieved through improved nutrition of ruminant animals and better management of paddy rice fields. Additional CH4 decreases are possible by altered treatment and management of animal wastes and by reduction of biomass burning.

Emissions of GHGs in the agriculture sector is primarily of methane from paddy fields and from livestock (including enteric fermentation and manure management). Nitrogen fertilizer used to increase crop productivity is a source of nitrous oxide emissions, while field burning of agricultural residues and prescribed burning of savannas are sources of CH4, N2O, NOx, and CO2.

Climate Change (IPCC), this inventory was conducted by the Institute of Based on the methodologies provided by the Intergovernmental Panel on

VIET NAM

TABLE 5-1 GROSS VALUE OF CROPS AND

ANIMAL HUSBANDRY

SUBSECTORS AND DISTRIBUTION

OF CROPPED AREA (1990 - 1995), PERCENT

5.2 SECTOR GHGs INVENTORY

5.2.1 INTRODUCTION

PAGE 135

Subsector 1990 1991 1992 1993 1994 1995

Cultivation, total 74.4 75.0 73.9 73.5 73.3 73.0

Vegetable, bean, percent of total 4.7 4.5 4.3 4.6 4.7 4.7 area)

Other, percent 10.4 9.3 9.4 9.8 9.7 9.7

5.2.2 METHODOLOGY

TABLE 5-2 EMISSIONS FACTORS FOR RICE

FIELDS FROM VARIOUS REGIMES

WITHOUT ORGANIC FERTILIZERS

Deep water rice 16 NIAPP 0.46

PAGE 136

NIAPP - MOARD : National Institute for Agricultural Planning and Projection - Ministry of Agriculture and Rural Development.

VIET NAM

SECTION 5 AGRICULTURE SECTOR

ASSESSMENT

Meteorology and Hydrology in collaboration with the National Institute for Agricultural Protection and Planning. This inventory is based on the base year of 1993, because was the most recent year for which good data were available for GHGs estimation. This year is also representative of the time of the transition economic situation in Viet Nam.

The primary GHGs emissions from livestock is methane, produced from digestive processes, mainly in ruminants, and from animal manure. Enteric fermentation in herbivores produces methane as a by-product of the digestive process. Methane emissions from enteric fermentation and animal manure is estimated according to IPCC (1995), Tier 1 methodology.

Anaerobic decomposition of organic material in flooded rice fields produces methane, which escapes to the atmosphere primarily by transport through the rice plants. The quantity of methane emitted is believed to be a function of rice species, number and duration of harvests, soil type, water management, fertilizer use, and temperature. Recently, experts agreed that the relationship between CH4 emissions and soil temperature as presented in the IPCC Guideline (1995), was no longer appropriate, because new data suggest that the seasonally integrated CH4 flux depends much more on the input of organic carbon, the water regime, time and duration of drainage, and soil type, etc., than on the local temperature. The emissions of methane from rice fields is calculated as follows

Fc = Ef x A x 10 -12

Where:

Fc is the estimated emissions of methane from a particular rice water regime and for a given organic amendment, in Tg. Ef is the seasonally integrated emissions factor and per cropping season, in gm-2. A is the annual rice-cultivated-area under these conditions and per cropping season, in m2.

20 NIAPP-MOARD 5.46 100 Percent flooded irrigation (constantly flooded irrigation)

Rice field category Emissions

factor, g/m2 Data Sources

Are under category,

million mha

Intermittently flooded irrigation - -

Rainfed 16 NIAPP 0.64


ASSESSMENT

The emissions factors given in Table 5-2 for calculation are those for inorganic fertilizer use. However, there are two different kinds of fertilizers used in the South and the North of Viet Nam. In the South, where 61.6 percent of the country’s rice fields are located, only chemical fertilizers are applied, while organic + chemical fertilizers are used in the North of Viet Nam (38.4 percent total of country’s rice fields).

organic + chemical amendment, a correction factor of 2 (range 2-5) must be applied to the coefficient for the corresponding rice ecosystem without organic amendment. The total emissions from rice paddy in Viet Nam, calculated by this method, are presented in Table 5-3.

It is noted that for conversion to CH4 emissions from rice paddy soil with

TABLE 5-3 TOTAL METHANE EMISSIONS FROM

VIET NAM

RICE PADDY IN

1 2 3 =( 1/2) 4 5 = (3x4) 10 = 5+9

1.268 38.4 0.487 2 0.974 1.755

1 6 7 = (1/6) 8 9 = (7x8) 10 = 5+9

1.268 61.6 0.781 1 0.781 1.755

The animal population and emissions coefficients used to calculate methane emissions from livestock in Viet Nam in 1993 are presented in Table 5-4.

Dairy cattle 16 56 27

Buffalo 2,960 55 3

Goat 353 5 0.22

VIET NAM

TABLE 5-4 ANIMAL POPULATION AND

EMISSIONS COEFFICIENTS FOR

METHANE EMISSIONS FROM

LIVESTOCK

PAGE 137

The North of Vietnam Total

Emissions without organic

amendment, Tg

Proportion of

emissions percent

Emission without organic

amendment,

Correction factor

Emissions from rice

ecosystem, Tg

Total Emissions From Rice Ecocystem,

Tg

Total Emissions without organic

amendment, Tg

The South of Vietnam

Proportion of

Emissions percent

Emissions without organic

amendment,Correction

factor

Emissions from rice

ecosystem, Tg

Total Emissions From Rice Ecosystem,

Tg

Animal Types Total

population ’000 heads

Enteric Fermentation, kg/head-year

Manure Management, kg/head-year

Non-dairy Cattle 3,317 44 2

Sheep 0

Horse 133 18 -


ASSESSMENT

Poultry: Native Chicken 133,400 0.023

5.2.3 DATA SOURCES

PAGE 138

Source: IPCC Methodology - 1995 for emissions factor, and NIAPP for animal population.

Release of non-CO2 trace gases from savanna burning.

The estimation of GHGs emissions from prescribed burning of savannas is based on the IPCC 1995 guideline. There are two kinds of savanna in Viet Nam, shrub savanna and grass savanna, covering 308 kha and 88 kha, respectively. The biomass densities of the two types of savanna are 40 t dry matter per hectare on shrub savanna and 30 t dm/ha on grass savanna. These local data were obtained from the Institute of Forest Science, Ministry of Agriculture and Rural Development.

Field burning of agricultural residues and release of non-CO2 trace gases.

The estimation of GHGs emissions from on-site burning of agricultural residues is based on the IPCC 1995 method, with the assumption that the total carbon released is a function of the amount and efficiency of biomass burning. The carbon content of the biomass non-CO2 gas emissions was estimated by applying the emissions ratio of CH4 and CO to the total carbon released. Similarly, the emissions ratios of N2O and NOx are based on the total nitrogen released.

The rice production data were obtained from the National Statistical Office. The assumption regarding the fraction of crop residue burned in the field was derived from the default factor for developing countries.

The data for animal population come from the annual statistical reports of National Statistical Office. The numbers of livestock and poultry in Viet Nam, 1993, are presented in Table 5-4.

The data sources for rice paddy under various water management regimes are based on statistical material from the National Institute for Agricultural Planning and Projection-Ministry of Agriculture and Rural Development (MOARD). These materials define three categories of rice fields in Viet Nam: continuously irrigated, rainfed, and deep-water rice with water depth ranging between 50-100 cm.

The local data for burning savanna come from the Institute of Forest Science (MOARD).

The principal agricultural residues burned in the field are from the residues of rice straw. The rice production data were obtained from the National Statistical Office. The assumption regarding the fraction of crop residues burned in the field was derived from the default factor for developing countries.

The inventory of agricultural soil is based on the data of fertilizer consumed by crop type provided by the National Institute for Agricultural Planning and Projection - MOARD.

VIET NAM

Animal Types Total

population ’000 heads

Enteric Fermenttion, kg/head-year

Manure Management, kg/head-year

Swine 14,874 1 7

-

SECTION 5

The summary of Viet Nam's emissions of GHGs from the agriculture sector (CH4, CO, N2O, and NOx) during 1993 is presented in Table 5-5. The major emissions in the agriculture sector consist of CH4 (2247 Gd/year), followed by CO (975 Gg/year), NOx (24 Gg/year) and N2O (3Gg/year).

Methane

The crop cultivation subsector is the major source of methane emissions, with rice cultivation contributing 78 percent of the total (1,755 Gg/year). The livestock subsector contributes 20 percent (452 Gg/year) of the total emissions. Within the livestock subsector, enteric fermentation is the most important source, contributing 73 percent, while the remaining 27 percent comes from manure management. Biomass burning from savanna and agricultural residues emit only 1 percent of the methane (24 Gg/year and 16 Gg/ year). The major regions of savanna burning (shrub and grass) are the Central and the North of Viet Nam, while the burning of agricultural residues is practiced mainly in the South of Viet Nam.

Carbon Monoxide

The source of CO emissions is biomass burning of savanna and agricultural residues. Both are comparable in rates with total emissions of 975 Gg/year. The prescribed burning of savannas is the more important of the two types of biomass sources (65 percent).

Nitrogen Oxide (NOx)

Emissions of NOx from burning of savanna are 11 Gg/year and from agricultural residues are 14 Gg/year.

Nitrous Oxide (N2O)

The total emissions of N2O is estimated at 3 Gg/year by using the medium default values of emissions coefficients from the IPCC methodology, 1995. Agricultural soil is the most important source of N2O emissions, contributing 79 percent of the total N2O emissions. The remaining 21 percent are from biomass burning in prescribed burning of savanna (9 percent) and burning of agricultural residues (12 percent).

AGRICULTURE SECTOR

ASSESSMENT

5.2.4 NATIONAL GHGs INVENTORY

FOR THE AGRICULTURE

SECTOR

FIGURE 5-1 EMISSIONS OF AGRICULTURAL

SECTOR, CO2-EQUIVALENT

VIET NAM PAGE 139


ASSESSMENT

TABLE 5-5 SUMMARY OF THE 1993

EMISSIONS OF GREENHOUSE

GASES FROM AGRICULTURE

SECTOR, GG

a. Dairy Cattle 0.90 0.43

b. Non-dairy Cattle 145.95 6.63

c. Buffalo 162.80 8.88

d. Swine 14.86 104.12

e. Goats 1.76 0.08

f. Horse 2.39 0.29

g. Poultry 3.07

Subtotal 328.66 123.50 452.16

a. Completely flooded

b. Intermittently flooded

c. Deep water rice

d. Rainfed

Subtotal 1,755.00 1,755.00

Subtotal 2.54 2.54

Shrub

Grassland

Shifting Cultivation

Subtotal 23.96 628.91 0.30 10.71 23.96 628.91 0.30 10.71

16.49 346.39 0.38 13.77 16.49 346.39 0.38 13.77


PROJECTION OF SECTORAL


PAGE 140

Assumption of the Projection

The methodology used in this inventory is the same methodology used in the national GHGs inventory for 1993, which is discussed in Section 5.2.2. The baseline scenario is based on detailed investigations and projection of economic development and the development objectives of the Viet Nam Government toward the agricultural production in the next decade, i.e., the continuation of providing food security for all and export reinforcement.

Viet Nam’s population has been estimated to reach 80 million in year 2000 and more than 100 million in 2020. The demand for food supply will increase. The requirement of rice is projected to increase from 12.9 million t (1995) to 15

VIET NAM

No Subsectors CH4 CH4 CO N2O NOx

1 Livestock Enteric Fermentation

Manure Mngt

2. Rice Field CH4

3. Agricultural Soils

N2O

4. Prescribed Burning of Savanna

CH4 CO N2O NOx

5. Burning of Agric. Residue CH4 CO N2O NOx

Total Emissions 2,247.61 975.30 3.22 24.4


ASSESSMENT

million t (2020). Meat demand will increase from 0.5 mt (1995) to 2.5 mt (2020), and milk demand will increase from 3,700 liters (1995) to 1.3 million liters (2020) (see Table 5-6). The agricultural production needs to be enhanced, and therefore an increase in the GHGs emissions from agriculture sector may be expected.

Per Per Total Per Total Per Total capita Total capita (1) capita (II) capita (III)

TABLE 5-6 FOOD AND FOODSTUFF

CONSUMPTION PROJECTION

TO 2020 (VALUES UNDER TOTAL

ARE IN THOUSANDS)

Milled rice 174 kg 12,870 171 14,022 144 13,680 144 15,120

Egg 45 piece 3,328 72 5,904 144 13,680 144 15,120

Vegetables 54 kg 4,020 100 8,200 100 9,500 100 10,500

Units. Sources: Note:

For Totals, kg, except Egg which is million pieces National Institute for Agricultural Planning and Projection Total (I) with the population of 82 million. Total (II) with the population of 95 million. Total (III) with the population of 105 million.

GHGs Inventory Projection to 2020

The GHGs emissions inventory projections for years 2000, 2010, and 2020 are presented in Table 5-7, based on the GHGs inventory for 1993 and with the assumption that the emissions factors will not change under the baseline scenario.

Livestock 452 20 560 22 692 25 927 30

Rice cultivation 1,755 78 1,894 76 1,998 73 2,111 68

Burning of savanna

Field burning of Agricultural 16 1 0.38 20 1 0.47 24 1 0.56 31 1 0.73 residue

24 1 0.30 27 1 0.39 12 1 0.5 12 1 0.15

Agricultural soil 2.54 3.31 3 .72 4 .95

The total 2,247 Gg CH4 emissions from the agriculture sector in 1993 is projected to increase to 2,501 Gg in year 2000, to 2,726 Gg in 2010, and to 3,081 Gg in 2020, while N2O emissions increases from 3 Gg in 1993 to 6 Gg in 2020. (See Table 5-7 and Figure 5-2).

VIET NAM

TABLE 5-7 CH4, N2O EMISSIONS

INVENTORY PROJECTION TO

2020, GG

Unit: Gg

PAGE 141

Year

1995 2000 2010 2020

Pea, peanut 2 kg 148 10.8 886 14.4 1368 14.4 1,512

Meat 7 kg 516 12 984 24 2,280 24 2,520

Fish 22 kg 1,620 24 1,968 36 3,420 36 3,780

Milk 0.51 37 4 328 12 1,140 12 1,260

Cooking oil 1.51 110 3.6 295 5.4 513 5.4 567

Sugar 3.5 kg 259 13 1,066 20 1,900 20 2,100

Options

1993 2000 2010 2020

CH4 CH4 CH4 CH4 N2O N2O N2O

Gg percent Gg percent Gg percent Gg percent

Total 2,247 100 3.22 2,501 100 4.17 2,726 100 4.43 3,081 100 5.83

N2O

SECTION 5

FIGURE 5-2 PROJECTED TOTAL CH4,

EMISSIONS FROM AGRICULTURE

SECTOR

TO 2020

AGRICULTURE SECTOR

ASSESSMENT

Rice cultivation is the greatest emitter of CH4; however, its contribution would decrease from 78 percent of the total in 1993 to 68 percent in 2020, while the contribution from livestock will increase from 20 percent in 1993 to 30 percent in 2020 (Table 5-7).


5.2.7 CONCLUSIONS

PAGE 142

The method for estimating emissions from enteric fermentation in cattle requires data on the population of various animals and the average emissions factors (kg CH4/head-year). However, the available data are insufficient for calculating the GHGs emissions accurately and for designing a mitigation strategy. The available data do not provide key information such as demographic characteristics of the population (e.g., age, weight, geographic distribution, and sizes of livestock) and the other variables related to emissions factors (e.g., feed intake and the conversion of feed energy to methane).

The method for estimating emissions from rice cultivation requires information about water management practices, season length, and fertilizer practices. Besides these, other information about rice cultivation practices, cultivar types, soil types, etc., should be collected and analyzed to ensure an accurate projection and inventory.

need to be initiated in the country: For improving future GHGs emissions inventories, the following activities

Collecting detailed data at the province level. Carrying out experiments to measure methane emissions from rice paddy under different cultivation practices in order to improve the emissions factors for rice cultivation related parameters. Carrying out household surveys in key areas for the livestock population characteristics. Collecting the data on low-methane-emitting rice varieties when available.

(i) The agriculture sector emits the largest quantities of GHGs in Viet Nam. In 1993, the total emissions were 2,247 Gg of methane emissions and 3.22Gg of N2O emissions, which equal 48 mt of CO2- equivalent.

VIET NAM


ASSESSMENT

Enteric fermentation 328.68 6,902.13 14.32

Manure Management 123.50 2,593.50 5.38

Rice Cultivation 1,754.70 36,848.70 76.46

Burning of Savanna 23.96 0.30 596.16 1.24

Field burning of Agricultural Residues 16.49 0.38 464.09 0.96

Agricultural Soil 2.54 787.40 1.63

The agriculture sector inventory revealed that 76 percent of total CO2-equivalent is produced from rice cultivation, and 20 percent is produced from the livestock subsector (Table 5-8),

(ii) To improve the accuracy of the GHGs emissions inventories, there is a need to carry out surveys and collect the detailed data of animal population and cultivation practices, including the data on low methane emitting rice varieties. Furthermore, there is a need to organize the measurement of methane emissions from rice paddy under different cultivation practices.

(iii) For updating the GHGs inventory in Viet Nam, the action plan proposed is as below:

Organize a study of the approach and methods of GHGs inventory according to IPCC guidelines. Test the confidence and applicability of GHGs inventory process, methods, and emissions factors provided by IPCC. Carry out experiments to determine some emissions factors relevant to Viet Nam. Establish an Office of GHGs Inventory. Undertake necessary efforts to bring out the first communication of the national GHGs inventory.

Greenhouse gases emitted from the agriculture sector in 1993 were equivalent to 48 mt of carbon dioxide. Agriculture produced 2.2 mt CH4 in 1993, accounting for 87 percent of total CH4 emissions of the country. The most significant sources are rice cultivation (78 percent of total CH4) and livestock (20 percent of total CH4) (See Tables 5-6 and 5-7). The inventory provides information to be used in deciding where mitigation should be focused and what abatement strategies need to be developed and implemented.

for mitigating greenhouse gas emissions, as presented in Table 5-9. Several potential GHGs abatement options exist in the agriculture sector

VIET NAM

TABLE 5-8 SUMMARY OF GHGs EMISSION

FROM AGRICULTURE (1993)

PAGE 143

Subsector CH4,Gg N2O,

Gg CO2-

equivalent, Gg of total

Percent

Total 2,247.33 3.22 48,192.13 100


ASSESSMENT

CH4 N2O

Water management in irrigated rice paddy fields High -

TABLE 5-9 POTENTIAL GHGs ABATEMENT

OPTIONS FROM AGRICULTURE

SECTOR

Directly sowing of rice paddy Low Low

Rational feeding of livestock High -

5.2.8 MITIGATION OPTIONS

ASSESSMENT METHODOLOGY

PAGE 144

Source: National Institute for Agricultural Planning and Projection- 1996.

However, two of the options in Table 5-9 have been identified as the most promising options:

(i) Water management in irrigated rice paddy fields. (ii) Rational feeding of livestock.

These mitigation options meet the following general guidelines for the agriculture sector:

For the remaining options, (i) Changing the cropping pattern, (ii) Directly sowing, (iii) Using biofertilizers, and (iv) Using biogas, because of insufficient data, the assessment of these options has not been considered.

Agricultural production levels will be maintained or enhanced in the country. Additional benefits will accrue to the farmer (e.g. reduced labor, reduced or more efficient use of inputs). Local consumers will accept agricultural products.

The following methods have been used to assess the mitigation options in agricultural sector.

(i) To determine the investment cost, financial value, and the NPV of benefits, a bottom-up approach has been taken.

(ii) The baseline and alternative scenarios have been clearly defined. These scenarios are considered important for providing decision- makers with useful guidance on the allocation of national resources.

(iii) Sources of data.

The agricultural economic data, such as rice yield, livestock population and productivity, investment cost, the production cost, benefit value, etc. come from the Institute of Agricultural Economies (IAE). These data inputs are grouped into four main economic regions: Red River Delta, North Central Coast, South Central Coast, and Mekong River Delta

Some assumptions have been provided by IAE.

VIET NAM

Options

Potential Emissions Abatement

Changing the cropping pattern from two-rice-crop to three crops system (Rice-upland crop-rice)

Medium Low

Using biofertilizers on the field crops - Low

Using biogas as manure management option in rural areas Low -

SECTION 5

Discount rate: 10 percent The price of rice is equal to $170 per t. The investigation of practice of water management in irrigated rice fields with periodic draining showed that at two growth stages of rice crop, the end of tillering and 15-20 days after flowering, the water requirement of rice is minimum. Draining of rice fields during these two stages may lead to achieving a higher yield of rice (7-9 percent increase). At the same time, it can decrease methane emissions by 25- 50 percent. The practice of improving nutrition through increasing feed digestibility, by mechanical processing and chemical processing of the feed, was found to be a feasible mitigation option in the livestock sector. This option will lead to a higher productivity among livestock (about 10 percent) and it also reduces methane emissions by between 10 and 25 percent.

(i) Mitigation option for methane emissions from rice cultivation:

In Viet Nam, agricultural production still plays an important role. According to the country Agricultural Development Plan, there is a need to achieve a production of 28 mt of food grains in 2000, 33.8 mt in 2010, and 44 mt in 2020 to guarantee food security, to provide for export, and to make strong development of breeding. In rice paddy, intensive farming techniques have to be adopted to achieve a productivity level of more than 4 t/ha-crop

At present, there is 5 mha of irrigated rice. However, the control of irrigation can be currently implemented in very small areas. The Government is providing for investments to improve the irrigation system.

Development needs to be focused on management of irrigation water, with a system of draining rice fields during the growing season, in the areas with secure irrigation supplies. These areas are the Red River Delta, the North Central Coast, the South Central Coast, and the Mekong River Delta.

The goal of this option is to control and provide sufficient water requirements for rice crops so that food production is improved and methane emissions from rice cultivation is reduced.

Mitigation of methane emissions from livestock

Animal population is expected to increase in the next few decades. There were 3.3 million cattle, 3 million buffaloes, and 15 million swine in 1993. Their population is expected to increase up to 7 million cattle, 4.5 million buffaloes, and 38 million swine in 2020.

In Viet Nam, most of the feed supplied to ruminant animals (cattle and buffaloes) is of low quality and is not subject to any form of

(ii)

VIET NAM

AGRICULTURE SECTOR

ASSESSMENT

5.2.9 SUMMARY OF MITIGATION

OPPORTUNITIES

PAGE 145

SECTION 5

TABLE 5-10 MITIGATION OPTIONS IN RICE

PRODUCTION AND LIVESTOCK

REARING

5.2.10 ASSESSMENT OF MITIGATION

OPTIONS

PAGE 146

AGRICULTURE SECTOR

ASSESSMENT

processing. The greatest opportunity for reducing CH4 emissions among ruminant animals is through increasing the feed digestibility through mechanical and chemical processing of the feed.

In other words, chemical and physical treatment of low quality crop residues that are fed to ruminants can enhance animal productivity and lower CH4 emissions per unit product. The treatment methods include alkali/ammonia treatment, chopping, grinding, heating, steaming, and wrapping and preserving by-products of crops such as rice, maize, and sweet potatoes.

The goals of this option are as follows:

Increasing the quantity and quality of livestock feed in order to improve the meat and milk production. Reducing methane emissions from livestock.

A summary of the potential of the two options is presented in Table 5.10.

Controlling the water irrigation and drainage of rice field.

Intermittent draining of rice field during the end of tillering and after flowering 15 - 20 days

50 - 100 kg/ha year 7- 9 Area to be targeted, kha - Red River Delta: 1,102 - North Central Coast: 592 - South Central Coast : 497 - Mekong River Delta: 3,269

Increasing quality of livestock 5 - 10 kg/head year 5-10 Animal population in region (’000 feed. head) Increasing feed digestibility and - Red River Delta: Buffaloes: 309 improving the productivity - North Central Coast: Cattle: 931

- South Central Coas : Swine:8,337 - Mekong River Delta:

Source: Institute of Agricultural Economy - 1996.

(i) Water management of rice fields

Rice plays an important role in the culture and diets of people of Viet Nam. The water management option for mitigating GHGs emissions in rice cultivation satisfies the criteria discussed in Section 5.3.1 and will be ecologically sustainable.

An assessment of the investment cost impact on rice yield is shown in Table 5-11. Under the baseline scenario, the baseline cost of rice is $1,052/ha- year, which includes expenses of inputs: labor, seeds, fertilizer, chemicals, electric for irrigation; and equipment, machinery, land. The baseline yield is 7,340 kg/ha-year with a financial value of $1,248/yr.

percent (640 kg/ha-year) valued at $1,357 (Table 5-11), and this option reduces

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Intermittent drainage of rice fields will increase the rice yield by about 7-9

Features of alternative practice

Methane emissions reduction potential

per ha or per animal per year

Impact on yield of milk or rice grain, percent change

Feasible target area or groups or population

RICE PRODUCTION 1. Intermittent Draining

LIVESTOCK PRODUCTION 2. Improving Feed Quality

SECTION 5

methane emissions (assumed) by 50 kg/ha-year. However, the option is more expensive than the baseline scenario by about $69/ha-year.

(ii) Improving livestock nutrition through mechanical and chemical feed processing

Improving nutrition reduces methane emissions per unit of product by enhancing animal performance, including weight gain, milk production, and work and reproductive performance. Methane emissions per unit of digestible energy consumed by animals will also be reduced.

An assessment of the investment cost and impact on animal yield are shown in Table 5-11. Under the baseline scenario, the averaged investment cost is $41/head, which includes stud animal, feed, medicine, and labor. The baseline yield is 84 kg/head-year with a financial value of $48.7. With the assumption that feed digestibility is increased by 5 percent, the option of improving nutrition through mechanical and chemical feed processing will increase the animal yield by about 6 kg/head-year, valued at $52. The methane emissions reduces by about 10 percent (5 kg/head-year). The option is more expensive than the baseline scenario by about $3/head-year. (Table 5-11)

AGRICULTURE SECTOR

ASSESSMENT

$/ha $/ha $/ha Baseline Alternative

Agriculture 1. Option-1 69 1,052 1,121 7,340 640 1,247.8 1,356.6

Livestock 2. Option-1 3 41 44 84 6 48.7 52.2

Ag ricu Itu re 50 1.01 +0.54

Livestock 5 0.40 +0.07

Option 1

Option 1

The incremental cost for the two options discussed above were all positive. For the water management option, the cost of methane emissions reduction is estimated to be $1.01/kg methane reduced. Improving livestock nutrition will cost $0.40/kg methane reduced (Table 5-12).

The NPV of benefit /kg of methane avoided for the water management option is $0.54/kg. That of the improving nutrition option is $0.07/kg methane avoided.

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TABLE 5-11 ASSESSMENT OF INVESTMENT

FOR MITIGATION OPTIONS COST AND IMPACT ON YIELD

TABLE 5-12 COST-EFFECTIVENESS OF

METHANE EMISSIONS

REDUCTION OPTIONS

PAGE 147

Options

Investment cost for

the alternative practice

Baseline cost for crop

production

Total cost

Baseline yields

kg/ha yr

Incremental yield kg/ha

yr

Financial value of production $/ha

Options

Methane emissions avoided

kg/ha-yr or kg/animal-yr

Cost of Methane emissions reduction ($/kg)=(Incremental cost of practice/ha)/(kg of

methane emissions avoided/ha) or

practice/animal/year)/(methane emissions

avoided/animal/year)

NPV / kg of methane

avoided=(NPV of incremental

yield/ha)/(kg of methane

avoided/ha)


ASSESSMENT

5.3 BASELINE AND LEAST- COST ABATEMENT

SCENARIOS TO 2020 5.3.1 APPROACH AND

METHODOLOGY

5.3.2 SCENARIO ASSUMPTIONS



PAGE 148

(i) Establish a reference scenario on the basis of a representative national macroeconomics forecast, technology, and emissions data.

Specify a set of relevant GHGs abatement options and make a separate direct cost and emissions ranking of these compared with reference scenario.

(ii) Analyze and assess the cost of methane emissions reduction and NPV of benefits per kg methane avoided of one or more of the alternatives for GHGs abatement.

Baseline scenario assumes an increase of 19 percent in rice cultivation area and 89 percent in livestock population (Table 5-13), driven by a demand for increased food supply (Table 5-6). There will be no technologies used toward mitigation of GHGs emissions Abatement scenarios were considered by decreasing the GHGs emissions in the year of 2020 by 15 to 20 percent of its value in the reference year. This would be brought about by the adoption of

(i) Water management with the intermittent draining of rice fields during the growing season.

(ii) Improving the nutrition of livestock through mechanical and chemical animal feed processing.

The area under rice cultivation is projected to increase by 19 percent (Institute for Agricultural Planning and Projection, 1996). However, the extent of irrigated area is also expected to increase from 5.46 mha in 1993 to 6.02 mha in 2000, 6.94 mha in 2010, and 7.45 mha in 2020. The projected methane emissions is presented in Table 5-7.

percent (Table 5-13) and methane emissions are projected in Table 5-7 The livestock population (cattle and buffaloes) is projected to rise by 89

Urban, percent 0.2 0.3 0.6

Forest, percent 29.9 33.4 48.9

Agricultural, percent 22.2 24.4 26.6

Wasteland, percent 42.2 35.8 15.6

Rangeland, percent

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2000 2010 2020

Population, millions Land Area, square kilometers

72.5 82 95 105

33,099 33,099 33,099 33,099

-

-

-

-


ASSESSMENT

Other, percent 5.4 6.1 6.4

Rice cultivation area, mha 6.5 7.0 7.3 7.7

Cattle and Buffaloes, mhead 6.4 7.4 9.4 11.9

Industrial GDP, percent 30.1 35.1 40.8 41.0

Services GDP, percent 42.4 45.5 46.5 49.0

Agriculture GDP, percent 27.5 19.4 12.7 10.0

A strategy has been developed to reduce methane emissions in year 2020 to reach a level of 9 percent over the base year, 1993. This could be achieved by targeting the two mitigation options as follows.

(i) Carrying out intermittent drainage of 5.5 mha of rice paddy under controllable irrigation. A mitigation of 50 kg CH4/ha-yr will result in a total of mitigation of 273 Gg CH4 through this option.

feed to 4.2 mt/yr will result in a reduction of 5 kg CH4/animal-yr from a total of 4.4 million animals. This will result in a total mitigation of 22 Gg CH4/yr.

(ii) Gradually increasing the quantity of improved (processed) animal

The development objective of the Viet Nam agriculture sector in the next decade will be to ensure food security and export reinforcement. This will be met by the expansion of rice cultivation area and by increasing the animal population together with intensive farming, which will lead to increased methane emissions in the country. The future emissions is estimated by constructing a mitigation scenario of two mitigation options in the agriculture sector.

Table 5-14 shows that the total CH4 emissions of the abatement scenario in agriculture sector with two mitigation options will decrease by 93Gg in 2000, 194Gg in 2010, and 295 Gg in 2020. The total emissions of the abatement scenario will be 361 Gg in 2000, 2,496 Gg in 2010, and 2,743 Gg in 2020.

Total investment cost for the two mitigation options from rice cultivation and livestock will be $1.90 million in 2000, $3.81 in 2010, and $5.71 million in 2020.

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5.3.4 MITIGATION SCENARIO

5.3.5 IMPACTS OF THE BASELINE

AND ABATEMENT SCENARIO

PAGE 149


2000 2010 2020

GDP, $ billion 21.21 37.54 93.03 220.24

GDP per capital, $ 293 462 979 2098

Estimated Share of the Informal Sector in the Economy in GDP; percent

Urban Population as percent of total 19.9 30 40 55 population

Livestock Population, million 6.4 7.4 9.4 11.9

Discount Rate, precent 10 10 10 10


ASSESSMENT

TABLE 5-14 INVESTMENT COST OF

REDUCING EMISSIONS FOR

2000, 2010, 2020

5.4 SECTOR LEAST-COST

GHGs ABATEMENT

STRATEGY 5.4.1 GENERAL SECTOR ABATEMENT

STRATEGY AND GOALS


IMPLEMENTATION OF STRATEGY

PAGE 150

CH4 emissions from Rice 1,755 1,894 1,998 2,111

CH4 emissions from Livestock 452 560 692 927

Sub total 2,207 2,454 2,690 3,038

1,755 1,804 1,818 1,838 CH4 emissions from Rice field under Water Management

452 557 678 905 CH4 emissions from Livestock through nutrition improved

Subtotal 2,207 2,361 2,496 2,743

Water Management 0 1,870 3,750 5,620

Livestock 0 30 60 90

Subtotal 0 1,900 3,810 5,710

On the basis of the agricultural situation in Viet Nam and its development, the scope of the emissions reduction strategy is focused on the rice cultivation and livestock subsectors.

The mitigation options to be promoted are as follows:

Water management leading to intermittent draining of rice fields during the growing season. Improving animal nutrition through mechanical and chemical feed processing.

Furthermore, a list of potential mitigation options has been presented under Section 5.3.1. Whenever adequate data concerning these options become available, these mitigation options could be implemented and considered in developing an abatement strategy.

Short-term (1998 to 2005)

A total of 1.8 mha of rice field will be irrigated and drained during the growing season. Most of this area would be located in the Red River Delta (1.1 million ha) and North Central Coast (0.5 million ha). Nearly 0.4 million head of buffaloes and cattle, and 2.7 million head of swine will be fed by improved methods of animal nutrition through the use of mechanical and chemical feed processing.

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Base year 2000 2010 2020

Baseline Scenario, Gg

Abatement Scenario, Gg

Investment Cost of Reducing Emissions, $ million


ASSESSMENT

Medium-term (2005 to 2015)

The irrigation and draining area of rice fields will be increased to 3.6 mha, the areas of rice field under water management option would be located in the Mekong River Delta. It is estimated that 2 of 4 mha in the whole Mekong River Delta will be covered in this period.

head of buffaloes and cattle and 5.5 million heads of swine.


The number of animal provided improved nutrition would be 1 million

A total of 5.5 mha of rice fields will be controlled by irrigation and intermittent draining during the growing season. (See Table 5-15) This total area will include 1.102 mha in the Red River Delta, 0.59 mha of the North Central Coast, 0.497 million ha of the South Central Coast, and 3.269 mha in the Mekong River Delta.

In this period, a total of 2 million heads of buffaloes and cattle and 8 million swine would be provided with the improved nutrition through mechanical and chemical feed processing.

91.9 Option 1 Buffaloes and Cattle: 2000 22,000

Option 2

Management

Improved Nutrition Swine:8000

Rice Field Water 5,460 273,000 5,620

Significant potential exists for mitigation of GHGs in rice cultivation and livestock production sectors through:

Water management and intermittent drainage of irrigated rice paddy fields. Changing the cropping pattern from “two - rice - crop” to “three crops system”. (Rice - Upland crop - Rice). Direct sowing of rice paddy. Using biofertilizer on the crop field. Rational feeding of livestock. Using biogas in rural areas.

The most promising options for reducing emissions are:

(i) Water management and intermittent drainage of irrigated rice paddy fields, and

(ii) Rational feeding of livestock. These options will lead to improvements in the standard of living of the rural population.

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TABLE 5-15 LEAST-COST STRATEGY,

MITIGATION POTENTIAL AND

INVESTMENT COST

5.5 CONCLUSIONS AND

RECOMMENDATIONS

PAGE 151

Ranking of options from lowest cost

option

Area to be dedicated, 1000 ha or animals to be

covered, 1000 animals under each option

Total methane emissions avoided kt/yr

Aggregate incremental

investment required, $ million

STRATEGY 1

SECTION 5

REFERENCES

PAGE 152

AGRICULTURE SECTOR

ASSESSMENT

For the mitigation option in livestock, the required incremental investment is estimated to be $91.9 million. For the mitigation option of water management in rice fields, it is estimated to be $5,620 million until 2020.

(iii) Barriers to adoption of mitigation options are:

Lack of knowledge about methane emissions from rice fields and ruminants on part of government officials, planners, and decision-makers. Limited infrastructure for production and dissemination of technologies. Lack of capital for investment in feed processing facilities and other infrastructure and resource improvements.

Bachelet D., Neue H.U.1992. Methane emissions from wetland rice areas of Asia. Pergamon Press Ltd.

Duong Anh Tuyen. 1996. Summary document of training course of estimating emissions from Agriculture and GHG in Viet Nam (Technical report).

General Department of Land Management 1996. Report on Viet Nam Land- User toward 2010 (Viet Namese paper).

General Department of statistic. 1993. 1994. 1995. 1996. Viet Nam statistic yearbook. Statistic Publishing House.

Institute of Agricultural Economy. 1996. Economic effect on Water irrigation in Rice paddy and Animal feed production. (Viet Namese Technical reports).

Mitra. A. P. 1992. Greenhouse Gas Emissions in India, 1991. Methane campaign. Dr. K. S. Krishnam Marg, New Delhi. 110012.

Mitra. A. P., Parashar D.C, Gupta Prabhat K. 1996. Methane budget from paddy fields in India.

National Institute for Agricultural Protection and Planning - 1996. The Database of Agricultural production. (Technical report).

Sathaye, J. and S. Meyers. 1995. Greenhouse Gas Mitigation Assessment. A Guidebook. Kluwer Academic Publ. Dordrch.

Vu Nang Dung. 1996. Report on existing situation of production and orientation of Agricultural Development in Viet Nam (Technical Report).

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SECTION 5

Vu Nang Dung. 1996 Orientation for development of Viet Nam Agriculture by the year 2010 (Technical Report).

Hydrometeorological Service of S.R of Viet Nam - 1997. Viet Nam National Greenhouse Gas Inventory, 1993 (Final Report ).

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AGRICULTURE SECTOR

ASSESSMENT

PAGE 153

SECTION 6 NATIONAL LEAST-COST

GHGs ABATEMENT STRATEGY

he Cost of Emissions Reduction Initiatives (CERI) Curves were developed under the ALGAS Project. CERI curves relate the quantity of T GHGs, which can be reduced or sequestered by mitigation options, to

the cost per unit of GHGs reduction. CERI curves are based on the principle of incremental cost analysis, where

incremental costs are equal to the difference in costs over time between a reference (baseline) scenario and alternative GHGs mitigation scenarios. Based on CERI curves, policy makers, analysts, and other interested groups can understand the impacts of choosing different sets of GHGs mitigation options.

CERI curves for the energy sector were developed with results from the EFOM - ENV model. Seven GHGs individual abatement options and two approaches to CO2 constraint were evaluated using the EFOM - ENV model.

CERI Curve for Individual Options in the Energy Sector

The individual mitigation options were estimated and evaluated for GHGs emissions and costs compared with the business-as-usual (BAU) scenario. The results for the individual abatement options are shown in Table 6-1 and Figure 6- 1.

win” (negative cost) options. The most effective options are listed below in order of cost-effectiveness.

The results show that all energy demand-side abatement options are “win-

(1) Highly efficient air conditioning (2) Energy efficient refrigerators (3) CFLs(4) Improvement of efficiency in electric motors (5) Improvement of efficiency in cooking

On the supply side, wind power construction is a cost-effective option. Switching coal and oil thermal-fired power plants to gas is more expensive than the baseline.

6.1 NATIONAL COST OF

EMISSIONS REDUCTION

INITIATIVES (CERI) CURVES

6.1.1 ENERGY SECTOR

CO2 emissions, mt 2,477 2,404 2,461 2.389 2,425 2,407 2,472 2,443

∆CO2 emissions, mt 73 16 88 52 70 5 34

Cost per t CO2 reduction – 4.15 – 8.31 – 8.53 –10.54 –7.19 46.4 – 4.64

Source: Results from optimization, 1998. ENV-1: Efficiency improvement in coal cooking ENV-2: Compact fluorescent lamps ENV-6: Fuel switching in existing ENV-3: Energy efficient refrigerators thermal power plant ENV4: Energy efficient air conditioners ENV-7: Wind power plant

ENV-5: Highly efficient electric motors

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TABLE 6-1 DIFFERENCES IN CO2 EMISSIONS

INDIVIDUAL MITIGATION

SCENARIOS COMPARED TO BAU SCENARIO

AND COSTS OF VARIOUS

PAGE 157


Cost, $ million 34,354 34,051 34,221 33,603 33,806 33,851 34,586 34,196

∆Costs, $ million –303 –133 –751 –548 –503 232 –158


FIGURE 6-1 CERI CURVE BY INDIVIDUAL

OPTIONS

CERI Curve by Reduction of CO2 Emissions

(i) First Approach

The ABAT01, ABAT02, and ABAT03 cases set constraints on CO2 emissions in year 2020 to be reduced by 5 percent, 10 percent, and 15 percent, respectively, compared to the BASE case. The CO2 emissions are reduced by 9.02 percent, 13.8 percent, or 18.35 percent compared to the BAU case, by implementing ABAT01, ABAT02, or ABAT03, respectively. The discounted cost of the ABAT01 case is higher than that of the BASE case but lower than BAU case. The incremental cost of the ABAT01 case is –$22.79 per tonne avoided CO2emission in comparison with the BAU case, while those of ABAT02 and ABAT03 are $3.88 per tonne avoided CO2 emissions and $4.87 per tonne avoided CO2emissions, respectively. Table 6-2 shows CO2 emissions and total discounted costs for the first approach, and Table 6-3 presents the CO2 emissions abatement and incremental cost for the first approach.

(ii) Second Approach

The ABAT04, ABAT05, and ABAT06 cases set constraints on CO2emissions in the period 2005–2020 to be abated by 0.5 percent, 1 percent, and 1.1 percent, respectively, compared to the BASE case. The total CO2emissions in the whole study period is reduced by 13 percent, 17.51 percent,

TABLE 6-2 CO2 EMISSIONS AND

TOTAL DISCOUNTED COST

IN FIRST APPROACH

PAGE 158

BAU 22.00 45.92 77.10 105.17 196.98 34,354

ABAT0l 22.00 43.20 74.36 101.08 179.22 9.02 5.00 34,101

ABAT03 22.00 43.20 74.36 101.08 160.35 18.60 15.00 34,384


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Scenario 1994 2000 2005 2010 2020

Percent CO2 Abatement in

2020 Compared to

Discounted Cost,

$ million

BAU BASE

BASE 22.00 42.15 72.39 97.77 188.65 4.23 0.00 33,447

ABAT02 22.00 43.20 74.36 101.08 169.78 13.80 10.00 34,129


FIGURE 6-2 CO2 EMISSIONS IN FIRST

APPROACH

TABLE 6-3 CO2 EMISSIONS ABATEMENT AND

INCREMENTAL COST IN FIRST

APPROACH

BAU 2.477 0.00 34,354.00 0

BASE 2.395 3.33 8.49 33,447.00 –907 –108.88

ABAT01 2.386 3.71 91.92 34,871.00 –22.79

ABAT02 2.368 4.43 109.69 34,129.00 75 3.88

ABAT03 2.349 5.19 128.55 34,384.00 138 4.87



RELATION IN FIRST APPROACH


VIET NAM PAGE 159

Case

CO2 Emissions in 2020 million tonnes

CO2 Abatement in Whole period

Compared to BAU Case

Discounted Cost

$ million

Incremental Cost

$ million

Cost of CO2 Emissions Reduction &/t CO2 equiv. Percent million

tonnes


or 18.72 percent, compared to the BAU case, by implementing ABAT04, ABAT05, or ABAT06, respectively. The discounted cost of ABAT04 and ABAT05 cases is higher than that of the BASE case but lower than BAU case. The incremental cost of the ABAT04 and ABAT05 cases is –$1.47 and –$0.88 per tonne avoided CO2 emissions, respectively, in comparison with the BAU case. The incremental cost of ABAT06 is $0.11 per tonne avoided CO2emissions. Table 6-4 shows CO2 emissions and total discounted costs, and Table 6-5 presents the CO2 emissions abatement and incremental costs for the second approach.


DISCOUNTED COST IN SECOND

APPROACH

BAU 22.00 45.92 77.10 105.17 196.98 34,354

BASE 22.00 42.15 72.39 97.77 188.65 4.23 0.00 33,447

ABAT01 22.00 43.20 72.03 95.36 175.05 11.13 7.21 34,140

ABAT02 22.00 43.20 71.67 93.02 162.49 17.51 13.87 34,130

ABAT03 22.00 43.20 70.89 92.56 160.10 18.72 15.13 34,492


FIGURE 6-4 CO2 EMISSIONS IN SECOND

APPROACH

TABLE 6-5 CO2 EMISSIONS ABATEMENT

SECOND APPROACH

AND INCREMENTAL COST IN

PAGE 160

BAU 2,477.74 0.00 34,354 0.00

BASE 2,395.25 3.33 82.49 33,447 –907.00 –1 0.99

ABAT01 2,305.40 6.96 172.34 34,101 –1.47

ABAT02 2,221.42 10.34 256.32 34,129 –225.00 –0.88

ABAT03 2,201.65 11.14 276.09 34,384 30.00 0.11

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Case 1994 2000 2005 2010 2020 $ million Cost,

Discounted Percent CO2 Abatement in

2020 compared to

BAU BASE

Case Emissions in Whole

Period, million tonnes

CO2 Abatement in Whole Period

Compared to BAU Case

Discounted Cost,

$ million

Incremental $ million

Cost,

Cost for 1 tonne CO2 Reduction,

$/t-CO2 Equiv. Percent million tonnes

CO2




RELATION IN SECOND

APPROACH

The COMAP (Comprehensive Mitigation Analysis Process) model was used for assessing several forestry mitigation options. Based on the modeling results, forestry CERI curves were developed for the baseline and feasible scenarios. The forestry mitigation options under the two scenarios consist of five options: Enhanced natural regeneration (F1), Long rotation reforestation (F2), Short rotation reforestation (F3), Forest protection (F4), and Scattered trees (F5). The calculation of the average incremental cost of each option is based on present value of life-cycle cost (endowment cost). The total potential carbon abatement under the baseline scenario is 471 million tonnes, equivalent to 1,727 mt of CO2. The potential carbon abatement of the feasible scenario is 987 mt, or 3,619 mt CO2-equivalent .

relationship between the potential carbon reduction (and carbon stored) and the cost per unit carbon, of the five forestry mitigation options.

Figure 6-6 (baseline scenario) and Figure 6-7 (feasible scenario) express the

VIET NAM


FIGURE 6-6 FORESTRY SECTOR CERI CURVE

UNDER BASELINE SCENARIO

PAGE 161


I FIGURE 6-7 FORESTRY SECTOR CERI CURVE

UNDER FEASIBLE SCENARIO

F2: Long rotation reforestation F3: Short rotation reforestation F4: Forest protection F5: Planting scattered trees


PAGE 162

Forest protection options under both Baseline and Feasible scenarios have the highest mitigation potential and the lowest cost. The ranked order of forestry options from low to high cost under Feasible scenario is: Forest protection (F4), Enhanced natural regeneration (F1), Planting scattered trees (F5), Long rotation reforestation (F2), and Short rotation reforestation (F3).

Forest protection and enhanced natural regeneration were assessed to be the best options for Forestry and Land-use Change Sector at the National Workshop on GHGs Mitigation Options and other NTE's meetings. They have multiple environment and socioeconomic benefits and can be implemented at the country level in the years to come.

The principal measures for reducing methane emissions from the agricultural sector are water management with the intermittent draining of rice fields during the growing season, and improving nutrition of livestock through mechanical and chemical feed processing.

Methane emissions from rice paddy are projected to decrease from the current 2,111 Gg CH4 per year to 1,838 Gg CH4 by the year 2020 through the intermittent draining of rice fields at the end of tillering and at 15-20 days after flowing. The incremental cost of this mitigation option is $1.01/kg of CH4

avoided.

by 285 Gg CH4 through improved nutrition. The incremental cost of this mitigation option is US$0.40/kg of methane avoided.

Figure 6-8 expresses the relationship between the potential carbon reduction and cost per unit carbon reduction for the two agriculture sector mitigation options. The description of the options and the results of their evaluation are summarized in Table 6-6.

Methane emissions from the livestock subsector are projected to be reduced

VIET NAM

SECTION 6

6.5 mha of rice cultivation in 1993, increasing to 7.1 mha in 2000, 7.3 mha in 2010 and 7.7 mha in 2020

1.7 Tg CH4 emitted in 1993, 1.9 Tg CH4 in 2000, 2.0 Tg CH4 in 2010, and 2.1 Tg CH4 in 2020.

The population of livestock is 6.6 million cattle and buffaloes in 1993, increasing to 11.5 million in 2020.

425 Gg CH4 emitted in 1993, 560 Gg CH4 in 2010, and 927 Gg CH4 in 2020.

Projection to 5.5 mha of rice paddy with water management and under intermittent draining in the rice growing season in 2020.

4018 Gg $1.01/kg CH4 CH4 avoided

285 Gg $0.40/kg CH4Project to 4.4 million head of buffaloes and cattle provided with nutrition improved through mechanical and CH4 avoided chemical feed processing

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NATIONAL LEAST-COST GHGs ABATEMENT STRATEGY

FIGURE 6-8 AGRICULTURE SECTOR CERI CURVE

TABLE 6-6 MITIGATION OPTIONS IN

AGRICULTURAL SECTOR

PAGE 163

Description

Total Methane Abated,

Gg

Incremental Cost

Baseline

Water Management in Rice Fields

Improving Nutrition through Mechanical and Chemical Feed

A1: Feed ProcessingA2: Water Managemnet

SECTION 6

6.2 COORDINATED NATIONAL

LEAST-COST GHGs ABATEMENT STRATEGY

6.2.1 NATIONAL ABATEMENT

STRATEGY AND GOALS

PAGE 164


Energy Sector

The general GHGs abatement strategy for the energy sector in Viet Nam is to use energy efficiently on both supply and demand sides, minimize the cost of energy, and reduce pollution emissions. The key elements of the strategy are:

Promotion of conservation and efficient use of energy. Promotion of rational use of national energy resources. Utilization of new and renewable energies. Integration of social and environmental concerns in the implementation of a program of sustainable economic development.

Specific elements are as follows:

(i) Power sector loss reduction and efficiency improvement

In the short-term (1998-2005):

The T&D system will be rehabilitated and upgraded. New technology for production of high efficiency transformers will be installed. The standards for medium voltage level will be selected. Improvement of efficiency of existing power plants.

(ii) Renewable energy utilization


Encourage use of new and renewable energy sources, especially wind power. Establishment of wind farm with capacity of 10-20 MW. Maximal use of hydropower resources with special focus on highly economic projects on Da River, Se San River, and Dong Nai River.

In the medium and long-term (2005 and beyond):

Pursue large-scale utilization of renewable energy resources. Develop other energy sources, such as nuclear power.

(iii) End-use energy efficiency improvement


Collect and analyze data and conduct feasibility study of standards for electrical appliances. Collect and analyze data and conduct feasibility study for improvement of energy efficiency in State-owned industrial enterprises.

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SECTION 6

In the medium-term (2005-2015):

Adopt and implement efficiency standards for electrical appliances. Develop and implement feasible standards for improvement of energy efficiency in existing and new State-owned industrial enterprises and building systems.

Forestry Sector

The GHGs abatement strategy supports the general objectives for the forestry sector which are expressed in the main document on the economic and social development of Viet Nam. The document indicates that the forestry sector should concentrate on: improvements in the economic result of the operations, increasing the rate of forest plantation, accelerating revegetation of bare hills, improving the results of forest exploitation, and creating a forest resource capable of protecting the environment and harboring diverse wildlife.

decade, as follows: There are several concrete objectives for the forestry sector in the next

Strengthen the national protection capability by protecting 9.3 mha of existing forests, increasing the rate of forest plantation, and accelerating revegetation of bare hills. Focus on activities concerning natural forest regeneration and establishment of new plantations in order to reforest 5 mha in the period 1998-2010. By the year 2010, there will be more than 15 mha of forests, with forest coverage at 45 percent of the land area. Provide employment for local people. Gradually improve the living standard for more than 20 million people living in and around forest areas.

With particular reference to the proposed mitigation options, the following strategies are recommended.

(i) Reforestation

Develop feasible reforestation projects in which more productive plantations are established in order to meet the growing demand for wood for industrial use and fuelwood. Reforestation efforts should give more attention to:

Local socioeconomic conditions of the plantation sites and the approach to participation of the local people for planning and implementation of the plantation programs. In fuelwood-deficit areas, in particular, community forestry approach needs to be explored. Consideration should be given to natural reforestation schemes if necessary, combined with natural regeneration, enrichment, or other silvicultural measures. Research should provide locally focused advice on the right species and the best seed resources for reforestation.

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PAGE 165

SECTION 6

PAGE 166


Maintenance of plantations, involving replanting where necessary, is an integral part of the reforestation effort, and can determine the success or failure of a program.

(ii) Forest protection

Create nonforest-based livelihood opportunities.

Improve the protection and management of existing forests within the special-use forestland. Implement the policy “Stop logging in natural forests for a given period” to reduce current deforestation rate in the country. Expand the protection forest area from 5.7 mha to about 7 mha.

(iii) Planting scattered trees

Increase the planting of scattered trees to 400 million trees per year. Allocate land to the households for practicing cultivation in forestry- agriculture systems. Expand urban forestry.

(iv) Information and education

Raise public awareness about environment protection, including forest protection and management. Adequate information and education campaign for each mitigation option.


The rate of reforestation is planned to reach about 140,000 ha per year, an increase of 30 percent as compared with the average annual reforestation rate in the past 5 years. In addition, about 1.5 billion scattered trees will be planted, and 6.5 mha of existing natural forests will be protected. At the same time, natural regeneration will be allowed in 1.8 mha of degraded forests. As a result, there will be about 1 mha planted in forest by 2005.


In order to maintain and improve the carbon sinks in the country, forest protection options will continue to be carried out. The average annual reforestation rate will be reduced gradually. From 2005, about 100,000 ha of forest and 200 million scattered trees will be planted annually. It is estimated that by 2015, more than 2 million additional ha would have been planted since 1998, including 1.2 mha of protection forests.


Reforestation will continue at a rate of 160,000 ha per year. About 1 mha of wasteland will be revegetated by 2020. Natural forests will be also protected for the whole period. By the year 2020, a number of forest products such as roundwood, timber, etc. from established plantations and some natural forests

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will be harvested to meet the country demand as well as for export.

aspects for promotion of forestry mitigation options. Table 6-7 shows several technical, economic, policy, and institutional

1. silvicultural practices for Financial sources: 1. Land tenurial rights 1. Strengthening local high yields forestry agencies.

2. Short and long rotation 1. Govemment’s investment for 2. Renovate state forest plantations establishing plantations and 3. Credits with preferential enterprises

planting scattered trees. interest rates.

farming of development investigation (WB, ADB, Forestry Agencies plans and projects

4. Land suitability classification 3. Households’ investment 4. Managing communities.

5. Agroforestry and integration 5. Support farmers in

6. Support education

2. Assured markets

3. Seeds provided by the 3. Technical assistance for the 2. International organizations’

overments of other countries)

trees marketing

1. Protection of natural forests Financial sources: 1. Allocation of forest and 1. Strengthening local and degraded forests. forest land belonging to forestry agencies.

1. Government’s investment for forest the three kinds of 2. Assisted natural protection. forests (special-use. 2. Renovate state forest

regeneration protection, and enterprises 2. International organizations’ production)

3. Prevent forest fires investigation (WB, ADB, WWF, 3. Make contracts with Governments of other countries) 2. Clarify the ownership collectives for forest

4. Biodiversity conservation rights for different kinds protection of forests.

5. Support education and raise 3. Ban extraction of timber

4. Promote fixed cultivation and settlement

people’s awareness about forest protection and environment protection.

5. Develop forest laws and legislation

6. Relocate people living in protected areas

Agriculture Sector

The development strategy of Viet Nam agriculture in the next decade is stated as follows:

“Continuing to firmly assure the foods and foodstuffs matters for the full society and export reinforcement. Strongly developing all high valuable tree kinds via the intensive cultivation in order to respond to the requirement of raw materials for processing industry. Forming the regions of concentrated breeding, the firms of processing foodstuffs with several shape/scale types. Strongly developing the processing industry, performing the investment in depth, closely attaching the process of renewed processing equipment to the rearrangement of system of agricultural-forest all-products processing firms.’’

The following discussion presents a number of tasks to be undertaken to

Production of foods must accomplish three objectives:

(i) To satisfy the food requirement for people’s consumption in any situation, (ii) To sufficiently strengthen the food source to meet demand and provide

enough raw materials for the industry.

support implementation of the agriculture sector objectives stated above.

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TABLE 6-7 TECHNICAL, FINANCIAL, POLICY

PROMOTION OF FORESTRY

MITIGATION OPTIONS

AND INSTITUTIONAL ASPECTS FOR

PAGE 167

Technical Aspect Financial Aspect Policy Institutional Aspect

Reforestation, Enchanced Natural Regeneration and Scattered Trees

Forest Protection

SECTION 6

PAGE 168


(iii) To effectively increase the export volume of agricultural products.

Intensify cultivation of food crops, concentrating on productivity of rice and corn. Rapidly produce new seeds, especially hybrid seeds, and strains with high efficiency, quality, and good resistance to pests and diseases. Invest in the rice industry, including the drying system, grinding, polishing, classification of rice via the modern equipment, and port facilities. To establish a policy of support for the food produc- ers, ensuring reliable and competitive income for the long term. The objective is to increase food productivity from the current 26 mt per year to between 30 and 32 mt in year 2000.

Breeding of livestock:

(i) Enhance the program of producing the improved strains. To assure breeds are developed according to the most recent research in the field. To rapidly develop the industry for processing the feeds in the larger breeding region.

(ii) Implement the big herd-developing program to produce high quality, lean meat through the method of advanced hybridiza- tion for prompt enhancement of product volume.

Implementation of breed improvement will allow achievement of the year 2000 target of 7 million buffaloes and cows, 17 million pigs, and 170 million poultry, and the program will enhance the livestock productivity to meet the targets of chopped meat of 2 mt per year of all kinds, and 60,000 t of fresh milk, in the year 2000. This program is expected to relate closely with the improvement of animal nutrition through mechanical and chemical feed processing.

The abatement strategy for the agriculture sector consists of two measures:

(i) Reducing methane emissions from rice paddy while maintaining or increasing the rice production.

In Viet Nam, rice plays a key role in culture and diet. The GHGs abatement strategy must satisfy the following criteria: improvement of rice productivity, low requirement of hard currency, and ecological stability.

water management with intermittent draining during the growing season, can be researched and developed at the start of the program.

reduced by the year 2010, and about 273 Gg/year of CH4 emissions will be reduced after 2020.

The technologies for reducing methane emission from rice paddy, such as

About 180 Gg of CH4 emissions from rice cultivation are expected to be

(ii) Improving nutrition of livestock through mechanical and chemical feed processing.

About 3 Gg of CH4 emission will have been reduced by the year 2000 from this mitigation option. About 14 Gg/year of CH4 emissions are expected to be reduced by the year 2010, and about 22 Gg /year of CH4 emissions will be reduced after 2020.

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GHGs abatement will become a component of the Environment Impact

Water management in the rice fields, with intermittent draining during the Assessment for agriculture-related projects and activities.

growing season, will be researched and developed in the pilot areas, such as Red River Delta.

methods of animal nutrition through the use of mechanical and chemical feed processing.


Nearly 1.7 million head of buffaloes and cattle will be fed by improved

The period 2005-2015 is the time of full implementation of the selected agricultural options. During the period, appropriate and relevant policies will be needed to strengthen the mitigation program implementation.

The irrigation and draining of rice fields will be increased to 4.5 mha, which would be located in the Mekong River Delta.

The number of animals provided with improved nutrition would be 3.6 million head of buffaloes and cattle.


The same activities are assumed to be undertaken beyond 2015 with adjustments in terms of target setting. Assessment of the program will be continuing, with consideration of new options and strategies that should be formulated.

The GHGs mitigation program is continued with 5.5 mha of rice fields under water management. This total area is comprised of 1.102 mha in the Red River Delta, 0.59 mha of the North Central Coast, 0.497 mha of the South Central Coast, and 3.269 mha of the Mekong River Delta.

provided with improved nutrition through mechanical and chemical feed processing.

In this period, a total of 4.4 million head of buffaloes and cattle would be

1. Planning water conservation Financial sources include: 1. Land tenurial rights. 1. Joint committee in the rice cultivation areas between agricultural

1. Government investment for main 2. Bank for lending credit agencies and farmers. 2. Expansion of high yield pumping system and main to farmers with low rate

varieties of rice irrigation canal. of interest. 2. Marketing: Including the

3. Saving water for irrigation 2. Farmers' investment (in-kind). 3. Low lee for the use of Government of farmers' with high effectiveness irrigation system products.

purchase by

3. Investment from international organizations: (GEF, ADB, WB)

1. Providing animal food for 1. Government investment for feed 1. Assured markets and 1. Contribution of animal high yields. processing industry. price of animal food to farmer.

hybrid varieties. 2. Bank for lending credit between agricultural

the concentrated strains

products.

to farmers with low rate

2. Developing of advanced 2. Farmers' investment 2. Joint committee

3. Upgrading firms producing of interest agencies and farmers.

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TABLE 6-8 TECHNICAL, FINANCIAL, POLICY,

AND INSTITUTIONAL ASPECTS OF

MITIGATION OPTIONS IN

AGRICULTURAL SECTOR

PAGE 169

Technical Aspect Financial Aspect Policy Institutional Aspect

Water Management

Improving Nutrition

SECTION 6

6.2.2 SUMMARY OF ALGAS PROPOSED INITIATIVES

TABLE 6-9 SUMMARY OF NATIONAL

LEAST-COST ABATEMENT

ENERGY, FORESTRY, AND

AGRICULTURE

STRATEGY INITIATIVES IN


The potentials for GHGs emissions reduction and the costs of each initiative in the three sectors are presented in Table 6-9. The data refer to implementation of the various mitigation options, as discussed in the sections on each sector. The overall potential for each option is spread over the three time periods. The abatement cost is assumed to be the same in each period.

ENERGY SECTOR

Fuel switching 1.6 46.4

Wind power 10.9 –4.64

Improvement of efficiency in cooking 23.4 –4.15

CFL 5.1 –8.13

Highly efficient air conditioning 16.6 –1 0.54

Highly efficient refrigerator 28.2 –8.53

Highly efficient electric motors 22.4 –7.1 9



CFL 6.4 –8.13

Highly efficient air conditioning 20.8 –10.54


Highly efficient electric motors



CFL 3.8 –8.13

Highly efficient air conditioning 12.5 –1 0.54


Highly efficient electric motors 16.8 –7.19

FORESTRY SECTOR

Forest protection 342 0.4

Enhanced natural reforestation 34 0.9

PAGE 170 VIET NAM

GHGs Abatement Initiative Potential Carbon Sink Enhancement, million

tonnes of CO2

Cost of Initative, $/tonne of CO2

Short-term (1998-2005)

Medium-term (2005-2015)

Lond-term (Beyond 2015)



FORESTRY SECTOR

Reforestation 28 2.8

Planting scattered trees 31 1.0




Planting scattered trees 33 1 .0




Planting scattered trees 16 1.0

AGRICULTURE SECTOR

Water Management 19 24.0

Feed processing 0.9 9.5


Feed processing 3.8 9.5


Feed processing 6 9.5

VIET NAM PAGE 171

GHGs Abatement Initiative Potential Carbon Sink Enchancement, million

tonnes of CO2

Cost of Initiative, $/tonne of CO2



Long-term (Beyond 2015)




SECTION 6

REFERENCES

PAGE 172


Energy Review, Ministry of Energy - 1995.

Energy Balance of Viet Nam, Institute of Energy - 1994.

Power Development master plan stage 4, Institute of Energy - 1995.

Orientation for a National Energy Strategy, Ministry of Planning and Investment - 1996.

The Economic Development Policy in the Transition toward a Market Oriented Economy in SRV, Final Report, Industrial Policy. Ministry of Planning and Investment - 1996.

Greenhouse Gas Mitigation Assessment: A Guidebook

Ministry of Forestry, 1990: Forestry Sector Review - Forestry in Viet Nam.

Statistical Publish House, 1996: Viet Nam’s economy the period 1945-1995 and its perspective by the year 2020.

Ministry of Forestry, 1990: Forestry Sector Review - Tropical Forestry Action Plan, Land-use issues.

Programme on rehabilitation of 5 mha in the period 1996-2010, Ministry of Agriculture and Rural Development, Hanoi, March 1997.

Bachelet D., Neue H.U.1992. Methane emissions from wetland rice areas of Asia. Pergamon Press Ltd.

General Department of Land Management - 1996. Report on Viet Nam Land-User toward 2010 (Viet Namese paper).

Institute of Agricultural Economy. 1996. Economic effect on Water Irrigation in Rice Paddy and Animal Feed Production. (Viet Namese Technical reports).

Mitra. A. P. 1992. Greenhouse Gas Emissions in India, 1991. Methane campaign. Dr. K. S. Krishnam Marg, New Delhi. 110012.

Vu Nang Dung. 1996. Report on existing situation of production and orientation of Agricultural Development in Viet Nam (Technical Report).

Vu Nang Dung. 1996 Orientation for development of Viet Nam Agriculture by the year 2010 (Technical Report).

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portfolio of five GHGs abatement projects has been developed under the ALGAS Project in Viet Nam. The energy sector has three projects. A The forestry and land-use change sector, and the agriculture sector

have one project each.

In the Energy sector, the projects are:

1.

2. 3.

Improvement of energy efficiency in fuel combustion of industrial processes Waste heat recovery and power generation from cement factories Energy efficiency measures for industrial boilers

In the Forestry sector, the project is:

4. Reforestation for conservation and expansion of carbon sink in Lang Son and Ha Bac Provinces

In Agriculture sector, the project is:

5. Water management for reducing methane emissions in rice fields in the Red River Delta

A summary of the GHGs mitigation projects is presented in Table 7.1 and details of each project are given in Exhibits 7.1 to 7.5.

TABLE 7-1 SUMMARY OF PRIORITY GHGs MITIGATION PROJECTS

To reduce the GHGs emissions by 2 years 0.25 GEF improving the efficiency of fossil fuel combustion in industrial processes.

Reduce the cost of energy inputs to industrial processes.

Provide information to the industry sector institutions in the form of an inventory of energy - efficient, best available technologies and processes.

To save energy in cement plant by 3 years 10 GEF recovery of waste heat. AIJ

Japan To reduce GHGs emissions from cement production by reducing fuel consumption.

To reduce GHGs emissions by 4 years 0.8 GEF improving the efficiency of fossil fuel boilers in industry.

Capacity building of industrial institutions to implement efficiency boilers

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Key Objectives of the Project Anticipated Timeline

Estimated Budget

$ million

Potential Funding Source

Improvement of energy efficiency in fuel combustion of industrial processes

Waste heat recovery power generation from cement factor

Energy efficiency measures in Industrial boiler



German Govt. Conserve up-river forest and enhance 4 years 2.8 carbon sink of degraded forestland.

Establish 12,500 ha of Pinus massioniana and other tree species.

Provide employment for 10,000 local households.

Conserve soil, water and enhance biodiversity.

To reduce methane emissions from rice 3 years 1.5 GEF fields.

To increase rice production in response to people’s consumption requirement.

PAGE 176 VIET NAM

Key Objectives of the Project Anticipated Estimated Potential Timeline Budget

$ million Funding Source

Reforestation for conservation and expansion if carbon sink in Land Son and Ha Bac Province

Water management for reducing methane emissions from rice fields in the Red River Delta

SECTION 7

Background

Industrial processes in Viet Nam were responsible for 38 percent of GHGs emissions from fossil fuel combustion in the energy sector in 1993. Therefore, the measures for energy saving and GHGs emissions reduction from industrial processes are very important. The proposed project is to assist industrial institutions to have good information on advanced and energy efficient industrial technology.

Project objectives

To provide information needed by planners and analysts in Viet Nam to undertake GHGs emissions reduction opportunities in the industrial sector. To provide information in the form of inventory of energy-efficient, best available technologies and processes that can reduce the growth of GHGs emissions in energy-intensive industries. To build capacity and provide training for industrial institutions to implement energy-efficient technology.

Activities

Conduct an inventory of environmentally sound and economically viable industrial technologies with information on the energy use, costs, and GHGs emissions. Conduct industry-specific assessments of GHGs-reducing technologies and practices. Conduct comprehensive analysis to provide a broader picture of current and future potential to reduce GHGs emissions in industry. Prioritize investment to industry.

cost Technical assistance (GEF): $250,000

Duration 2 years

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PORTFOLIO OF LEAST-COST


EXHIBIT 7.1 IMPROVEMENT OF ENERGY

EFFICIENCY IN FUEL

COMBUSTION OF INDUSTRIAL

PROCESSES

PAGE 177

SECTION 7

EXHIBIT 7.2 WASTE HEAT RECOVERY AND

POWER GENERATION FROM

CEMENT FACTORY

PAGE 178



Background

In 1993, cement production of Viet Nam increased to 5 million tonnes (mt). Demand for construction material will increase rapidly with the growing economy, and the cement industry should be developed to attain an annual output of 16 to 20 mt by year 2000 and 30 mt by 2010.

Saving energy and reducing GHGs emissions from the cement industry will meet the policy and plan of Viet Nam.

Project objectives

The project will use waste heat recovery and power generation technology in an existing cement plant with the following aims:

(i) To save energy use in the cement plant by generating electricity from waste heat recovered from the suspension pre-heater and the air quenching cooler.

(ii) To reduce GHGs emissions by combustion of fuel. (iiij To develop institutions' capacity for dissemination of this technology

to other cement plants in Viet Nam.

Project activities

(i) Conduct cement plant technology survey and develop database. (iii) Plan and adopt waste heat recovery power generation technology. (iii) Install waste heat recovery power generation equipment to an

(iv) Demonstrate the effectiveness of this technology by implementing

(v) Promote dissemination of the technology to other cement plants.

existing cement plant.

demonstration operation.

cost.. $ 10 million AIJ Japan: $7 million GEF: $2 million Viet Nam Government: $1 million

Duration: 3 years

Mitigation potential and benefit

Annual amount of energy reduced: 6,669 tonnes/year Annual amount of CO2 emissions reduced: 20,630 tonnes/year

Institutional arrangement

The Ministry of Science, Technology and Environment, the Ministry of Construction, and the Hydrometeorological Service will manage the project.

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SECTION 7

Background

Boilers in the Viet Namese industrial sector have operated for a long time. Consumption of thermal energy can be 150 percent of that used in comparable industries in OECD countries. Measures for improvement of boiler efficiency in Viet Nam will save a large amount of fuel and reduce air pollutant emissions.

There are about 600 boilers operating at present in the industrial sector of Viet Nam, with capacity ranging from 4 to 230 tonnes per hour, but most of them have a capacity of less than 10 tons per hour. There are only about 100 boilers with capacity from 10 to 230 tonnes per hour. They are operating in the thermal power industry, sugar industry, and paper industry. The efficiencies of the boilers range from 35 to 70 percent. Good practice efficiency may reach 85 percent. Therefore, the opportunity for energy saving by improving boiler efficiency is large.

saving measures. Measures requiring low investment cost include measurement devices, control devices, insulating materials, blowdown control, and improving fuel oil preparation. Long-term measures with high investment include redesigning and replacing inefficient boilers.

Project objectives:

The proposed project aims to improve boiler efficiency through energy

(i) Reduce energy consumption per unit product and GHGs emissions by improving the efficiency of fossil fuel boilers in the industrial sector.

(ii) Building of energy and industrial sector institutions by technology and energy management training in order to implement boiler efficiency improvement in industry.

Project Activities:

(i) Conduct a technological survey and develop database.

(ii) Conduct technical and policy studies.

(iii) Conduct training programs on energy auditing and energy management.

(iv) Pilot installation of improved boiler technology and assessment of boiler performance.

(v) Upgrade, adopt and disseminate new boiler technology.

cost: Technical assistance: $800,000. Investment: Cost of hardware installation, to be determined.

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EXHIBIT 7.3 ENERGY EFFICIENCY MEASURES

IN INDUSTRIAL BOILERS

PAGE 179

SECTION 7

PAGE 180



Duration 4 years

Institutional Arrangements:

Project management:

Ministry of Industry. Hydrometeorological Service.

Ministry of Science, Technology and Environment.

Project implementation:

Energy sector and industrial institutions

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SECTION 7

Introduction

Although the Viet Nam Government has made strong efforts in reducing forest loss in the country, the average annual deforestation rate is still more than 100,000 ha. Main factors that have caused the forest loss in Viet Nam are connected with the country's recent history. Due to rapidly increasing population, the people have reclaimed not only most of the deltas and coastal plains for farming, but a great deal of forest land has become inhabited, mainly by ethnic minorities. The land squatters prefer dense forest lands for food production by slash and burn practices, which has been seen as a major cause of deforestation. In addition, during the war, a large forest area including conservation forests was destroyed. In addition, natural forest has to be cleared for wood to meet the increasing demands in the country.

There are about 3 mha of brush lands needing immediate reforestation. Plantation establishment is one of the best solutions for releasing pressure on natural forest to meet wood demand and for assisting in rehabilitation of the ecological environment.

The proposed short-rotation-reforestation project is planned for implementation in Lang Son and Ha Bac provinces, and is aimed at the following goals:

Conserving and expanding carbon sink by reducing the pressure on the natural forest. Strengthening reforestation and forest land protection in the area. Providing employment for 10,000 households living in mountainous areas. Protecting up-river forests and preventing soil erosion. Decreasing shifting cultivation of ethnic minorities in the area.

Project Objectives:

The project intends to reforest 12,500 ha in Lang Son and Ha Bac provinces during 4 years. The project objectives are:

(i) Conserve up-river forest and enhance carbon sink of degraded forest land.

(ii) Establish 12,500 ha of Pinus massoniana and other tree species. (iii) Create employment opportunities for at least 10,000 local households

living in mountainous areas. Engage them in reforestation and forestry business.

(iv) Conserve soil and water and enhance biological diversity.

Project Activities:

(i) Set up a plan of land-use at commune level. (ii) Allocate forest land to the participating households. (iii) Train project staff and disseminate information for local people. (iv) Provide saplings and other relevant materials for the households (v) Establish credit support and financing in planting, maintaining, and

(vi) Establish a durable market for wood production. protecting forests.

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EXHIBIT 7.4 REFORESTATION FOR

CONSERVATION AND

EXPANSION OF CARBON SINK

IN LANG SON AND HA BAC

PROVINCES

PAGE 181

SECTION 7

PAGE 182



Project Cost and Benefits:

1. Net present value of benefits:

$1.79 / tC $93.74 /ha

Benefit of reducing atmospheric carbon:

$0.013 / tC - yr

2.

3. Initial cost:

$3.7 / tc $196.23 / ha

Endowment (present value of costs):

$4.26 / tC $222.94 / ha $2.8 million for the Project.

4.

5. Project financing:

Government of Germany: $2,380,000 Government of Viet Nam: $420,000

Risks:

Forest fire

Pest outbreak and diseases for pine

Fluctuation in the price of the wood products.

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SECTION 7

Background

Viet Nam is an agricultural country, with 80 percent of its population living in the countryside, carrying out the cultivation of more than 7.4 mha of agricultural land. Of this cultivated land, 4.3 mha are rice fields, and more than 1.2 mha are used for cultivation of long-term plants. Rice cultivation areas are usually located in the river deltas, and the most important are the Red River Delta and the Mekong River Delta.

Rice cultivation has the most significant contribution to the emissions of GHGs from the agriculture sector. The total CH4 emissions from rice paddies is estimated at 1,755 Gg CH4 in 1993 (68 percent of total CH4 emissions in the country, and 78 percent of total CH4 emissions from the agricultural sector). Methane emissions from rice cultivation is expected to grow to 1,893 Gg CH4 in 2000, 1,998 Gg CH4 in 2010, and 2,111 Gg CH4 in 2020.

The mitigation area identified in this project is the Red River Delta, in which the cultivation is under the intensive farming system. The Government and farmers in this area have invested in the irrigation system for a long time.

Methane emissions and abatement studies are expected to be conducted for estimating the possible contribution of water management in rice paddies to methane emissions reduction.

Project Objectives:

Global Environment Obiective:

Reduction of methane emissions from rice paddies while maintaining the rice productivity.

National Development Obiectives:

Increase rice production in response to the increasing national consumption requirements and the demand for exports, with the indirect effect of improving the life of the local people. Conduct a demonstration project to determine whether the recommended practices are cost-effective for farmers. Transfer the practices to agricultural managers and farmers.

Project Activities:

(i) Conduct experimental trials for water management in rice paddies in three plots (Hai Duong, Thai Binh, and Ha Tay) in the Red River Delta.

(ii) Develop the applicable study. (iii) Exchange information through training seminar or workshop. (iv) Transfer the practices to major rice producing areas of the country. (v) Monitoring and evaluation.

The Institute of Meteorology and Hydrology (IMH) shall implement the project for Agricultural Planning and Projection with the active participation of Agrometeorological Experimental Stations and Region Centers for Agriculture.

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EXHIBIT 7.5 WATER MANAGEMENT FOR

REDUCING METHANE

EMISSIONS IN RICE FIELDS IN

THE RED RIVER DELTA

PAGE 183

SECTION 7

REFERENCES

PAGE 184



Project Cost: Total cost: $1,500,000

Duration: 3 years

Project Financing: Global Environment Facility (GEF).

Risks:

Water calamities such as typhoon, flood, drought, etc. may affect the field trials and experiments. Lack of investment from the farmers.

Institute of Energy: Technological survey, 1995.

World Bank: Demand side management assessment for Viet Nam, 1997.

The economic Development policy in the Transition toward a market- oriented economy in the SRV, final report, Industrial policy Item cement, 1996.

Department of technical safety, Ministry of Industry, 1997; Fast statistical data on industrial boilers in Viet Nam.

Ministry of Forestry, 1990: Forestry Sector Review-Forest in Viet Nam.

Ministry of Forestry, 12 - 1991: Viet Nam Forestry Sector Review, Tropical Forestry Action Programme.

Ministry of Forestry, 1993: Renovation of Strategies for Forestry Develop- ment until the year 2000.

Feasibility Study on Forest Resource Conservation and Development, Draft of Main Report, 1997.

Institute of Agricultural Economy - 1996. Economic effect on Water irrigation in Rice Paddy and Animal feed Production. (Technical Report).

Vu Nang Dung - 1996. Orientation for development of Viet Nam Agricul- ture by the year 2010 (Technical Report).

Hydrometeorological Service of Viet Nam. 1996. Proceeding Viet Nam Training Workshop on Greenhouse Gas Mitigation Options.

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SECTION 8 NATIONAL GHGs

ABATEMENT ACTION PLAN

ectoral policy objectives and implementation plans in Viet Nam are summarized in Table 8-1, and discussed further below. S

Energy Sector:

The overall sectoral objective for the energy sector is to satisfy the energy demand for long-term development of the country. The national energy programs will focus on identification and diversification of primary energy sources with special attention to:

(i) Hydroelectricity (ii) Thermal electricity generation using natural gas (iii) Nuclear power

Sectoral, regional, and national strategies and the long-term development plan, the five-year social-economic development plans, and annual plans have been represented in the National Energy Plan (NEP). Appropriate policies in the energy sector will be undertaken as follows.

Energy Efficiency Policy

The Government of Viet Nam will consider the promulgation of an Energy Efficiency Policy implemented through Electricity of Viet Nam. The policy will promote the energy auditing measures and constant monitoring of energy use.

Renewable Energy Policy

The NEP will establish a regime that encourages plants to use new and renewable energy in electricity production. Temporary incentive schemes, such as subsidy to the renewable systems and allowances for the purchase of systems without tax, will be designed by the Government.

Environment Policy

National environmental laws and environmental standards have been launched. A system of regulation based on cost-benefit analysis should be developed.

Objectives Satisfy the energy demand for long- Implementation of term development of country, shift in direction of enhanced efficiency in the entire economy. management audit.

Identify and diversify primary sources with special attention given to the most important and clean energy sources. energy projects and

environmental standards and

Environmental socio-economic acceptability for

activities

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8.1 POLICY AND REGULATORY

8.1.1 SECTORAL OBJECTIVES

NEEDS

TABLE 8-1 SECTORAL POLICY OBJECTIVES

AND IMPLEMENTATION PLANS IN

VIET NAM

PAGE 187

Economic Development Environment GHGs

Mitigation

SECTION 8

PAGE 188

NATIONAL GHGs ABATEMENT

ACTION PLAN

GHGs national Implementation Replace coal-fired and oil-fired Plans/Targets thermal power generation by natural action plan for

implementation of UNFCCC being adopted by Government and incorporated into the national development

gas, with high efficiency gas combined cycle technology. The plan is expected to be completed in the period 1998-2005.

Implement of new clean GHGs energy plan; first priority is to develop hydroelectric power capacity up to 17,000 MW. plan

Develop and implement other renewable energy such as wind and nuclear power, by 2020 to reach capacity of 100 MW of wind power.

Reduce grid power system loss by rehabilitation and upgrading, and replacing existing small conductors by higher conductors from 1998 to 2005. Application of new technology for transformer and selection of standard medium voltage level at 20 kv

Implement demand-side management program by improving efficiency, reducing the intensity of energy consumption per unit of product, and electricity load management.

DSM program will save 680 MW of installed capacity and 3.55 billion KWh/year in 2010. At first phase will save 166 MW in 2002.

Status Pre-feasibility study and project Environmental standards and regulations for energy projects

feasibility preparation for offshore gas system using for gas generation.

Established plan and identified the map of hydropower plants from 1996 up to 2020. Wind power alter 2000 and nuclear power alter 2010.

Grid power system rehabilitation plan has been started first by assistance from ADB (1996-1998), after that by French Government (1997-1998).

Technical assistance for DSM has been prepared by World Bank and Electricity of Viet Nam Institute of Energy wth establishment of DSM cell office responsible for Energy

Objectives To promote improvement of general To strengthen the No existing living standards of the people. national protection GHGs mitigation

To promote improvement in the rural lives, particularly in the highlands and mountainous area.

To enhance forest productivity. To develop cultural communities

capability. policy

To promote sustainability in forest resources.

To increase forest coverage to 45 percent.

To conserve biological diversity

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Economic Development Environment Mitigation GHGs

Energy

Forestry

SECTION 8

Implementation To allocate forest land for local To create 5 million A National Plans / Targets households. ha of new forest in Action Plan on

combination with GHGs To provide job opportunities for local natural Abatement is people. regeneration. completing in

National Country To create the new resources base on Programme for the wastelands. protection forest implementation

of UNFCCC. To strengthen wood processing industry and non-wood forest products sector.

To supply 5 million m3 of pulpwood, 2 million m3 of pitprops, 25 million m3 of logs, and around 30 million m3 of fuelwood to domestic consumers.

To expand the

area from 5.7 to 7 million ha.

To plant 6 billion of scattered trees.To rehabilitate 1 million ha of degraded forest land including catchment and coastal areas.

To create 10 National Parks.

Status Programs are currently being submitted to the Government for approval

. .

Objectives To satisfy the requirement for people’s To reduce GHGs To raise consumption and further increase the emission from rice awareness of export volume paddies and the public on the

livestock impact of the To improve the living standard of rural people, and to increase net income To save water warming.To per capita resources prevent the

emission of GHG.

global

Implementation Intensify cultivation of food crops Rational use of Water Plans / Targets particularly the rice crop. national resources Management

and sustainablity in from rice fields Diversification of agriculture. sector with the

intermittent Forming the regions of concentrated draining during breeding. growing season

will reduce CH4emission.

Improving nutrition through mechanical and chemical feed processing .

Status Average rice productivity is about 3.6 Most people not Information on ton/ha/crop. The programs are adopted aware of the global climate change to Government for approval warming is still limited

No existing GHG mitigation policy

Forestry Sector:

The general objectives for the forestry sector are expressed in the main document on the economic and social development of Viet Nam in the following way:

most important factor in the balanced development of the rural areas of Viet Nam and in the creation of a new and stable basis for continued socioeconomic development in the rural areas.

Development of forestry in combination with processing industry is a

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Agriculture


Mitigation

Forestry

SECTION 8

TABLE 8-2 POLICIES, ACTS OR

REGULATIONS REQUIRED

FOR FORESTRY MITIGATION

OPTIONS

PAGE 190


ACTION PLAN

Projects prepared and implemented should be tailored to the local conditions in the area where they are to be implemented. In order to serve the projects and the general development in the area, economic, technical, and service units should be established in the area, and a suitable social and technical infrastructure should be created.

The document specifically indicates that the forestry sector should concentrate on: improvements in the economic results of the operations, increasing the rate of forest plantation, acceleration of revegetation of bare hills, improving the results of forest exploitation, and creating a forest resource

In general, several concrete objectives for the forestry sector in the capable of protecting the environment and harboring diverse wildlife.

next decade are as follows:

(i) Protect 9.3 mha of existing forests, increasing the rate of forest plantation, and accelerating revegetation of bare hills.

(ii) Focus on activities concerning natural forest regeneration and establishment of new plantations in order to reforest 5 mha in the period 1997-2010. By the year 2010, there will be more than 15 mha of forests, and forest coverage will have increased to 45 percent of the total land area.

(iii) Provide employment for local people and gradually improve the living standard for more than 20 million people living in and around forest areas.

In addition, the sector should apply relevant research to improving cultivation systems for sloping land. Close links between forestry and agriculture should be created, and also between forest operations and forest industries. The management of State forest enterprises should be reformed, and all other economic sectors should be encouraged to take part in forest operations.

of the mitigation program are presented in Table 8-2. Several policies and regulations or acts required to promote adoption

Allocate land to the local people in long term.

Reduce land taxation.

Provide soft credit. allocation.

Strengthen the role of State forest farms.

Develop forest protection policy with participation of local people.

Support local people's life in protected areas.

Improve several official documents related to forest land allocation.

Improve exisiting forest protection law to correspond with new conditions of land

Regulation related to rights and obligations of local people in protected area.

Improve logging regulation and forest minor products in protected area.

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Policies Required Acts or Regulations Required

Forest protection

SECTION 8

Allocate land to the local people in long term. related to forestland allocation.


Provide soft credit. allocation.

Develop forest protection policy with participation of local people.

Support local people’s life in protected areas.

Revise several official documents

Improve existing forest protection law to correspond with new conditions of land

Regulation related to rights and obligations of local people in protected area.

Disseminate techniques for local people.

Improve logging regulation and forest minor products in protected area.

Integrate activities of projects related to fix cultivation and settlement.

Allocate land to State/private enterprises and local people in long term.

Reduce land taxation and forest product taxation.

Provide soft credit.

Strengthen the role of State forest farms. including natural regeneration areas.

Develop regulation of forestland allocation.

Improve regulation related to forest product harvest from natural forest.

Support and disseminate technical extension on natural regeneration.

Replenish existing forest protection law


Create forest product markets.


Improve regulation related to rights of harvesting and selling forest product.

Project forest land areas under short rotation plantation.

Disseminate new techniques for farmers.

Manpower development (techniques and management.

Improve wood processing branch.

Encourage the planting of more environmentally friendly trees with high economic values.

Strengthen the role of local cooperatives.

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NATIONAL GHGS ABATEMENT

ACTION PLAN

PAGE 191


Degraded forest protection

Enhanced natural regeneration

Short rotation reforestation

SECTION 8

PAGE 192


ACTION PLAN


Create forest product markets.


Encourage foreign companies, term plantation. enterprises to invest in long rotation reforestation. Disseminate new techniques for

Strengthen the role of local cooperatives.


Improve regulation related to rights of harvesting and selling forest product.

Project forest land areas under long

farmers.

Create wood markets.

Provide soft credit Reduce forest product taxation.


Disseminate new techniques for farmers.

Agriculture Sector:

Viet Nam’s agriculture sector has undergone various changes owing to the evolution of the political and economic environment. The Doi Moi policy and the subsequent renovation process were aimed at transforming the economic system from a planned to a market-oriented economy. The economic incentives farmers gained through the renovation process have enhanced agricultural production. In fact, during the last five years, the GDP in the agriculture sector achieved an average annual growth of 4-5 percent.

The goals of the agricultural sector are to:

(i) satisfy the food requirement for the people’s consumption in any situation, to sufficiently ensure the food source and enough raw material for the industry, and to further increase the export volume;

(ii) develop all highly valuable tree varieties via intensive cultivation, and establish new plantations in order to respond to the requirement of raw materials for the processing industry; and

(iii) form regions of concentrated breeding of crops, and support the firms that process foodstuffs.

The following programs support these goals:

(i) Intensifying cultivation of the food crops (ii) Diversification of agriculture.

The program of intensifying cultivation of food crops sets a target of increasing grains production to 35 mt in 2010 and 45 mt in 2020.

The environmental objective of the agriculture sector is to ensure the food requirements of the country by adopting strategies and technologies

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Long rotation reforestation

Planting Scattered trees

SECTION 8

that are most appropriate, cost-efficient, and environment-friendly. However, GHGs reduction has not been included in these strategies. Methane emissions reduction from rice fields is a main mitigation measure proposed for the agriculture sector of Viet Nam. Methane reduction will be implemented by controlling the water irrigation and drainage of rice fields, with intermittent draining of rice fields during the end of tillering and at 15- 20 days after flowering. This proposed project might reduce methane emissions from rice paddies by 30-50 percent.

water management in rice cultivation, which is the greatest source of methane emissions in this sector.

The National GHGs Abatement Plan for Agriculture will focus only on

In setting up the National Plan for Environment and Sustainable Development, Viet Nam has recognized its environmental problems. The goals and specific objectives of the plan are summarized below and in Table 8-3.

The goals:

(i) To satisfy the basic material, spiritual, and cultural needs of all the people of Viet Nam, both present and future generations, through the wise management of national resources.

(ii) To define and establish policies, action plans, and institutional structures to ensure that the sustainability of national resources use will be fully integrated into all aspects of Viet Nam’s social and economic development process.

The specific objectives:

(i) Maintain Viet Nam’s wealth of genetic diversity of both domesticated and wild species for current and potential benefit.

(ii) Ensure the sustainable use of Viet Nam’s natural resources by managing intensity and pattern of use.

(iii) Maintain overall environmental quality necessary for the wellbeing of human existence.

(iv) Achieve a population level and distribution that is in balance with natural sustainable productivity at a dignified standard of living.

A specific objective for GHGs emissions reduction has not been formulated in this National Plan. Understanding the issue, Viet Nam is completing the Country Program for Implementation of UNFCCC as a part of the National Plan.

The national and sectoral objectives of the Country Program for Implementation of UNFCCC on GHGs emissions reduction in Viet Nam are based on national development goals, taking into account national and regional interests in economy and environment. It should also achieve global benefit. The National Plan does not conflict with those of other sectoral, national, regional, and global programs, but serves to reinforce them, and forms a part of a broad coordinated program for sustainable development. It will be a part of the commitment of Viet Nam to UNFCCC and the country’s environmental policy, contributing to the global efforts to protect our climate (see Table 8-4).

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8.1.2 NATIONAL OBJECTIVES

8.1.3 INTERNATIONAL OBJECTIVES

PAGE 193

SECTION 8

TABLE 8-3 NATIONAL POLICY OBJECTIVES

AND IMPLEMENTATION PLAN OF

VIET NAM

8.2 INSTITUTIONAL NEEDS

TABLE 8-4 INTERNATIONAL POLICY

OBJECTIVES AND

NAM

IMPLEMENTATION PLANS OF VIET

PAGE 194


ACTION PLAN

To satisfy the basic material, spiritual, Sustainable The specific and cultural needs of all the people of action plan for Viet Nam, through the wise GHGs mitigation management of national resources. has not been

formulated.

development

Maintain rapid economic growth for Rational use of A National long-term development of country with national resources Action Plan on annual GDP growth rate of 7-8 and sustainability in GHGs percent.

Achieve population level and distribution that is in balance with natural sustainable productivity of a dignified standard of living.

sectors Abatement is being completed in Country Program for Implementation of UNFCCC.

Being adopted by Government National Action Plan for Environment and Sustainable Development

For implementation of the National Action Plan a proposed institutional arrangement is presented in Figure 8-1.

National Assigned Agency:

The Government should appoint an agency with legal mandate as well as provide technical and financial support. The agency would be responsible for conducting and coordinating activities related to climate change issues and particularly GHGs abatement.

Improvement of human existence, Sustainable Viet Nam sustainable development on regional development acceded to and global scale UNFCCC as non-

Annex 1 Party.

To alleviate poverty and Rational use of Adopt Country backwardness. To raise the people’s natural resources Program for living standards to narrow the gap with developed countries all sectors Implementation

and subtainability in UNFCCC

Being adopted

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Objectives

Implementation Plans/Targets

Status

Mitigation

Economic Development Environment GHGs Mitigation

Objectives

Implementation Plans/Targets

Status

SECTION 8

National Implementing Committee:

Through the National Assigned Agency, a Committee for implementing the National Plan would be established. The ministries would nominate members of the Committee and would assign responsibilities to conduct country activities and sectoral coordination on issues related to climate change.

the contributions of a Scientific Council, the National Technical Expert’s Team, and the Climate Change Office.

to develop and submit the national GHGs inventory, to manage the country database related to climate change, and to evaluate GHGs emissions and propose programs, plans, policies, and projects related to GHGs reduction.

The Committee will undertake country and multi-ministerial tasks with

The main tasks of the Committee and its subsidiary organizations are

The institutional arrangement suggested is as follows:

Hydrometeorological Service National Counterpart Agency assigned for climate change.

Establish and operate the Office of Climate Change.

Ministry of Planning and Investment:

Conduct projects related to GHGs abatement.

Ministry of Science Technology and Environment:

Conduct and verify workplans of GHGs Inventory and Abatement.

Ministry of Foreign Affairs:

Conduct international activities related to UNFCCC and regular and irregular communications.

Ministry of Finance: Assist the Counterpart Agency with the budget needed.

General Department of Statistics:

Provide information on socioeconomic activities related to GHGs abatement. Assist the National Counterpart Agency with management of information and development of data bank.

Other Ministries (Industry, Transportation, Agriculture and Rural Development, Sea Production, Public Health, Education and Training, Trade, Foreign Affairs, Planning and Investment and Nongovernment organizations NGOs):

Nominate experts to participate in the Country Team. Coordinate with the Counterpart Agency in activities related to GHGs abatement.

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SECTION 8

FIGURE 8-1 SCHEME OF INSTITUTIONAL

ARRANGEMENT ON CLIMATE

CHANGE

8.2.1 ENERGY SECTOR

TABLE 8-5 INSTITUTIONAL NEEDS FOR

IMPLEMENTING ENERGY

SECTOR MITIGATION

OPTIONS

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ACTION PLAN

According to the National Energy Plan described in Section 8.1, certain institutional structures related to GHGs reduction would be developed and integrated.

(i) GHGs abatement by various measures should be conducted by restructuring the businesses of power generation, transmission, and distribution.

(ii) The regulatory and licensing functions should be strengthened and extended.

(iii) Technical and management training should be instituted for experts and managers in order to strengthen their awareness of economic and environmental benefits of GHGs reduction.

(iv) Prepare the action plan in coordination with the demand-side management (DSM) program.

(v) Promote the renewable energy program.

The institutional needs for implementing energy mitigation options are described in Table 8-5.

Substitution of coal by oil and oil by gas

Technical training program

Technological information

Improvement of efficiency in cooking In cooperation with DSM program

Highly efficient air conditioning, refrigerators, and electric motors

Technical and management training

Developing appropriate regulatory and licensing structure

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Mitigation Option Institutional Need

Construction of wind power plants Institutional strengthening and training on environmental assessment and management

Substitution of old bulbs with compact fluorescent lamps

Technical training program

Technological information

SECTION 8

The Ministry of Agriculture and Rural Development has full responsibility for forestry sector administration and management and is also in charge of forest production and other related activities. There is a need to establish a strong institutional mechanism for effectively undertaking GHGs abatement related activities.

In order to implement the identified forestry mitigation options successfully, there is a need to create close links between forestry and agriculture and between forest operations and forest industries. Participation of other economic sectors and local communities is also important in the success of plans and programs implemented in the sector, including forest protection, reforestation, and other related activities. History provides ample evidence that projects planned and executed with little regard for the welfare and aspirations of local people cannot succeed. Thus, all activities in the forestry sector will have to be planned and executed in close cooperation with the local people.

At present, the Department of Forestry and several institutions under the Ministry of Agriculture and Rural Development (MARD) conduct the implementation of forest protection and reforestation. The Ministry needs to establish a unit of protection and management for the protection and special-use forests. In particular, a Steering Board including members of the Viet Nam Climate Change Country Team (VNCCCT) needs to be established soon, and shall be responsible for activities pertaining to GHGs inventory, GHGs mitigation assessment, and GHGs abatement strategies.

The Government will support more funding for operations such as forest protection, watershed management, biodiversity conservation, reforestation, the development of special-use forests (nature reserves and national parks), and settlement of shifting cultivation.

are described in Table 8-6. The institutional needs for implementing forestry mitigation options

Forest protection, enhanced natural regeneration

Establish a management system from central to local levels (MARD → Provinces → Districts → Communes).

Strengthen existing cooperatives and establish new one for farmers participating in rehabilitation projects in the uplands.

Develop a credit system to deliver soft credit directly to households.

Formulate joint committee of local forest department and village community to assist in (a) selling minor forest products; (b) providing technical service; and (c) training and capability building.

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TABLE 8-6

IMPLEMENTING FORESTRY

INSTITUTIONAL NEEDS FOR

MITIGATION OPTIONS

PAGE 197

Mitigation Option Institution Required

SECTION 8 NATIONAL GHGs ABATEMENT

ACTION PLAN


8.3 GHGs ABATEMENT

ACTION PLAN

PAGE 198

Planting scattered trees Cooperate closely with NGOs, associations such as Association of Viet Nam Farmers, Association of Viet Nam Women, Association of Vietnamese Gardeners, etc. to encourage the movement of planting scattered trees all over the country.

Agro-forestry Extension Department for distributing suitable techniques and improved seedlings to local people.

Banks for lending credit to farmers.

The Agricultural Steering Team will be established for implementing the activities concerned. The Steering Team will include members of farmer organizations, institutions, NGOs, banks, and traders, as well as representatives of Government departments and agencies.

responsible for activities relating to the projects’ scheduling and budgetary and institutional needs. The Ministry of Science, Technology and Environment shall be responsible for developing and disseminating technologies and for enforcing environmental laws and regulations. The Bank of Agricultural Development shall be responsible for providing credit. The General Department of Land Management shall be responsible for land-use planning and management.

The Ministry of Agriculture and Rural Development shall be

The GHGs Abatement Action Plan for Viet Nam is described in Table 8-7.

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Mitigation Option Institution Required

Short/long rotation reforestation Establish a management system from central to local levels (MARD → Provinces → Districts → Communes).

Strengthen existing cooperatives.

Banks for lending soft credit to households

Formulate joint committee of local forest department and village community to assist in (a) selling minor forest products; (b) providing techniccal service; and (c) training and capability building.

Establish commercial cooperatives related to wood trade.

SECTION 8

Substitution by clean fuel in existing power stations:


Establishment of attractive Rehabilitation of Technical capabilities financing mechanism existing thermal enhanced.

Technical capacity preparation program High efficiency

Conversion of 640 MW coal-fired Plan for offshore GHGs emissions. to oil in the North and 198 MW of oil-fired to gas in the South

Institutional needs are: Technical training program years. Experts for operation Technological information

power plant

generation with low

gas use for generation plan Reduction of GHGs

emission to 5 mt CO2 equivalent in 25

Development of hydropower and other renewable energy sources


Environmental and social assessment of renewable energy projects, especially hydropower. Guideline and advisory for priority of hydropower based on cost and environmental benefit

Regulation for adaptation of renewable energy project including temporary subsidy


Large-scale utilization of 17,000 MW potential capacity of hydropower and renewable resources

Implementation will be in cooperation with Electricity of Viet Nam (ENV) Institute of Energy.

Institutional Needs: Institutional strengthening and experts training on environment assessment and management.

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TABLE 8-7 GHGs ABATEMENT ACTION

PLAN FOR VIET NAM

PAGE 199

GHGs Abatement Strategy Integration Options

Objectives Fulfilled

Energy

SECTION 8

PAGE 200


ACTION PLAN

Reducing power grid system loss


Conduct and guide on: National Upgraded grid

Rehabilitation and upgrading of program for standards. existing small conductors.

Application standard for new

rehabilitation system with new

deduction of gird system loss Reducing GHGs

emissions of about

equivalent in 25 transformers. 300 kt-CO2

Selection standard for medium years voltage levels at 20 KW.

Implementation will be in cooperation with Government grid system rehabilitation program Started in 1995.

Institutional needs: Technical assistance for training experts Institutional building for monitoring and management

Improving of efficiency in demand side management


Collect and analyze and conduct In cooperation Adopting standard of feasibility study for with DSM efficiency for standardization of electrical program. electrical appliances. Conducted by appliances. Reducing

Ministry of GHGs emissions by Collect and analyze data and Industry and WB. conduct feasibility study for consumption improvement of energy efficiency in existing State-owned industrial enterprises

reduction of fuel


Adopt and implement efficiency standards for electrical appliances.

Develop and implement feasible standards for improvement of energy efficiency in existing and new state-owned industrial enterprises and building systems.

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GHGs Abatement Strategy Integration Options Objective Fulfilled

Energy

SECTION 8

Establishment forest plantation

Developing feasible reforestation To support the Expanding carbon projects forestry program sink

Establishing more productive million hectares Reducing plantation to meet the growing in combination deforestation rate demand for wood in the country

To pay attention to local socioeconomic conditions and Strengthening participation of the local people for implementation of plantation To support “poverty alleviation” programs settlement program in the

program highlands and Allocating forestland to the local households for planting

Combining reforestation and natural regeneration

Developing a durable market for wood production

Provision of long-term credit with low interest rate

Provision of training and extension services.

to reforest 5

with natural regeneration cultivation

due to shifting

implementation of

mountainous areas

Forest protection

Improving the protection and To support Enhancing carbon management of the existing programs on sinks forests conservation of

forest Sustainable forest Expanding the protection forest ecosystems, bio- development area from 5.7 to 7 mha diversity, and

environment Improving the Creating non-forest-based protection and livelihood opportunities To support plan management of the

Encouraging local communities to of 10 national the special-use take part in forest protection parks forestland and activities protection forest land

on establishment existing forests within

To support the fixed cultivation and settlement program

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GHGs Abatement Strategy Options Integration

Objective Fulfilled

Forestry

SECTION 8

PAGE 202


ACTION PLAN

Planting scattered trees

Allocate land to local households To support Revegetation of bare for practicing cultivation in environment lands in the country forestry-agriculture systems protection

Spreading the movement of cities planning scattered trees at a rate of 400 million trees per year seedlings and Enhancing carbon

Expanding urban forestry communities to

program Revegetation of

Providing

saplings for local pools

support "Re- greeni ng bare land" program

Information and Education

Adequate information and To support To raise public education campaign environment awareness about

Education of public on programme protection including environment protection forest protection and

protection environment

management

To reduce methane emissions from rice cultivation while maintaining or increasing yield in rice production

Implementation: To make more Increasing rice Farm experimental trials for water intensive productivity and management in rice paddy will be conducted in Red River Delta. crops production cost

Developing the applicable study Reduce GHGs emissions from rice

cultivation of food efficiency of

Improving the awareness of the To transfer the paddy (CH4)society to GHGs emissions

To transfer the technology of water irrigating and draining in rice field

Monitoring and evaluation

Institutional needs: Upgrade capability of project staff for implementation Exchange information through training/seminar workshop for farmers.

technology of water irrigation and drainage in rice fields

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GHGs Abatement Strategy Integration

Options Objective Fulfilled

Forestry

Agriculture

SECTION 8

AgricuIture

Improving nutrition through mechanical and chemical feed processing

To enhance the Increasing the program of upgraded firms livestock feed to of producing the improve meat concentrated production. strains, to combine with the Reducing methane conventional emissions from feeds livestock

quantity and quality of

Ministry of Planning and Investment. 1996. “Orientation for a national Energy Strategy.”

Final Report. 1997. “Demand-Side Management Assessment for Viet Nam Phase 2.”

Report of project VIE/89/021 Viet Nam National Plan for Environment and Sustainable Development, 1991-2000 Frameworks for Action.

“Law on Environmental Protection”, 1994.

Institute of Energy. 1994. “Energy Balance for Viet Nam.”

Ministry of Agriculture and Rural Development. 1997. “Programme on Rehabilitation of 5 million hectares in the period 1996-2010,’’ Hanoi 3-1997.

Jayant Sathaye and Stephen Meyers, 1995: Greenhouse Gas Mitigation Assessment: A Guide Book. US Country Studies Program.

UNEP. 1992. “Greenhouse Gas Abatement Costing Studies, Phase One Report. UNEP Collaborating Centre on Energy and Environment, RISO National Laboratory, Denmark.

Ministry of Planning and Investment. 1996. “The economic development policy in the transition toward a market - oriented economy in the Socialist Republic of Viet Nam.” Final Report.

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REFERENCES

PAGE 203

GHGs Abatement Strategy Integration Options Objective Fulfilled

SECTION 9 RECOMMENDATIONS

AND FUTURE ACTIONS

iet Nam signed the United Nations Framework Convention on Climate Change (UNFCCC) at the United Nations Conference on Environment and Development in Rio de Janeiro, Brazil, in June 1992, and ratified

this Convention on 16th November 1994. Since February 1995 Viet Nam has been a Party to the Convention. Viet Nam is a Non-Annex I country to the Convention but the Government of Viet Nam has tried its best to optimize its organizing capacity to undertake relevant steps for the implementation of UNFCCC measures in order to contribute to humankind responses to climate change.

One of the activities for climate change in Viet Nam is implementation of the “Asia Least-cost Greenhouse Gas Abatement Strategies (ALGAS) Project”, funded by GEF with the ADB as the executing agency. The project has been implemented in 12 Asian developing countries including Viet Nam.

The main tasks of the Project were:

(i) Develop a National Inventory of GHGs Sources and Sinks (ii) Identify Options for Mitigation Abatement of GHGs (iii) Develop a Least-Cost Strategy for Mitigation/ Abatement of GHGs.

Fulfilling these tasks under the ALGAS Project, the1993 Viet Nam National GHGs Inventory, GHGs mitigation option assessment, and National GHGs Mitigation Abatement Strategy have been developed. This strategy should be adopted by the Government and implemented on a national basis.

Implementation of the GHGs Abatement Strategy should be integrated into aspects of the country’s development and should meet the following national and international objectives.

National objectives:

In setting up the National Plan for Environment and Sustainable Development, Viet Nam has recognized its environmental problems. The goals and specific objectives of the plan are described below.

Goals:

(i) To satisfy the basic material, spiritual, and cultural needs of all the people of Viet Nam, both present and future generations, through the wise management of national resources; and

(ii) To define and establish policies, action plans, and institutional structures to ensure that the sustainability of national resources use will be fully integrated into all aspects of the country’s social and economic development process.

Specific Objectives:

(i) Maintain Vietnam’s wealth of genetic diversity of both domesticated and wild species of animals, for current and potential benefit.

(ii) Ensure the sustainable use of Vietnam’s natural resources by managing intensity and pattern of use.

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9.1 NATIONAL

IMPLEMENTATION

STRATEGY

PAGE 207

V

SECTION 9

PAGE 208

RECOMMENDATIONS FOR

FUTURE ACTIONS

(iii) Maintain overall environmental quality necessary for the wellbeing of

(iv) Achieve population level and distribution that is in balance with natural human existence; and

sustainable productivity at a dignified standard of living.

Specific objectives of the strategy for GHGs emissions reduction, which have been formulated in the ALGAS Project, will be as stated below, and as a part of the National Environmental Plan.

International objectives:

The national and sectoral objectives of the strategy on GHGs emissions reduction in Viet Nam are based on national development taking into account national and regional interests in the economy and environment. It should also achieve global benefit. The development strategy does not conflict with those of other sectoral, national, regional, and global plans, but serves to reinforce them, and forms a part of a broad coordinated program for sustainable development. The National GHGs Abatement Strategy in this study will facilitate development of the country program for effective implementation of Vietnam’s commitments as a developing country under the UNFCCC.

National Implementation Strategy

In order to implement fully the GHGs strategy and at the same time undertake commitments as a party to the Convention, and to optimize and use all financial assistance and technology transfer, Viet Nam has developed a Country Program comprised of four main policies:

(i) Reducing anthropogenic emissions by sources and enhancing sinks of all GHGs by using cleaner energies, reducing energy loss, saving energy, and planting and protecting forests;

(ii) Adapting to climate change to foster agriculture’s adaptability, to manage the use of water sources, to prevent floods, and to monitor the prevention of the natural calamities;

gate and to enforce relevant Government Decrees on responding to climate change; and

(iii) Formulating policies on compiling and implementing laws to promul-

(iv) Formulating policies on expanding international cooperation.

The Country Program will be approved by the Government and guide the implementation of the National GHGs Abatement Strategy and commitments.

In the context of the National Strategy and implementation program, the Sectoral GHGs Abatement Strategies described below will be implemented.

Energy

The GHGs abatement strategy in the energy sector supports the national energy development policy. In general, this strategy may be summarized as:

(i) To maintain rapid growth and efficient and sustainable economic development by satisfying the energy demand for long-term develop-

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SECTION 9

ment, supporting the country’s shift toward enhanced efficiency in the entire economy;

and demand sides; (ii) Promotion of conservation and efficient use of energy on both supply

(iii) Promotion of rational use of national energy resources; (iv) Utilization of less GHGs emitting sources and new and renewable

energy; and (v) Integration of social and environmental concerns in the implementa-

tion of program of energy sector development and economically sustainable development.

This strategy will be implemented through energy programs and measures:

(i) Implementation of demand-side management (DSM) program of improving efficiency, reducing the intensity of energy consumption per unit of product, and electricity load management, including:

Compact fluorescent lamps; Energy-efficient refrigerators; Energy-efficient air conditioners; and Highly efficient electric motors.

Efficiency improvement in coal cooking;

(ii) Fuel substitution to less GHGs-emitting energy sources:

Fuel switching in existing thermal power plants from coal to gas; and Switching from cooking with coal to biomass and natural gas.

(iii) Identify and diversify energy sources, with special attention given to the most important and clean energy sources:

Wind power; Nuclear power; and

Forestry

Maximal exploitation of hydropower potential;

Geothermal energy for power generation.

The GHGs abatement strategy for the forestry sector supports the sustainable development goal of the country. The general objectives for the forestry sector in the next decades are to concentrate on improvements in the economic results of the operations, increase the rate of forest plantation, accelerate revegetation of bare hills, improve the results of forest exploitation, and create a forest resource capable of protecting the environment and harboring diverse wildlife.

as reforestation, forest conservation, and revegetation of wasteland and bare hills. Besides, it is necessary to raise public awareness about environment protection including forest protection and management. The strategy may be summarized as follows.

The GHGs abatement strategy should be focused on several activities such

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RECOMMEDATIONS FOR

FUTURE ACTIONS

PAGE 209

SECTION 9

PAGE 210

RECOMMENDATIONS FOR

FUTURE ACTIONS

Reforestation:

(i) Develop feasible reforestation projects in which more productive plantations are established;

(ii) Reforestation efforts should give more attention to local socioeconomic conditions of the plantation sites and include participation of the local people for planning and implementation of the plantation programs;

(iii) Combination of reforestation and natural regeneration; and (iv) Maintenance of plantations.

Forest protection:

(i) Improve the protection and management of the existing forest within the special - use forestland;

(ii) Implement the policy “Stop logging in natural forests for a given period” to reduce current deforestation rate in the country;

(iii) Expand the protection forest area from 5.7 to about 7 mha; and (iv) Create non-forest-based livelihood opportunities.

Planting scattered trees:

(i) Spreading the planting of scattered trees countrywide; (ii) Allocate land to the households for practicing cultivation in forestry-

agriculture systems; and (iii) Expanding urban forestry.

Information and education:

(i) Raise public awareness about environment protection, including forest protection and management; and

(ii) Adequate information and education campaign for each mitigation option.

Agriculture

(i) Water management in rice fields with intermittent draining during the season will be researched and developed. Then 5.5 mha of rice fields will be cultivated under water management. This total area is comprised of 1.10 mha in the Red River Delta, 0.59 mha of the North Central Coast, 0.50 mha of the South Central Coast, and 3.27 mha of the Mekong River Delta.

(ii) Improving nutrition through mechanical and chemical feed processing with a total of 4.4 million head of buffaloes and cattle would be implemented.

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SECTION 9

GHGs Mitigation Projects

As a first priority, five technical assistance projects have been identified to implement under the abatement strategies, and the general description of these projects has been prepared. Among them there are 3 projects from energy sector and one each from forestry and agriculture sectors.

Improvement in energy efficiency in fuel combustion of industrial processes

Waste heat recovery power generation from cement factory

Energy efficiency measures in industrial boilers

Technical Assistance



Reforestation for conservation and expansion of carbon sinks in Lang Son and Ha Bac Provinces


Water management for reducing methane emissions in rice fields in the Red River Delta


Institutional Arrangements

The implementation of these strategies and projects requires the following institutional arrangements:

(i) The promulgation of the Viet Nam country program for implementing UNFCCC.

(ii) The establishment of a multi-ministerial agency with a legal mandate and adequate technical, operational and financial support.

(iii) The Climate Change Country Team including representatives from all relevant Ministries and Government Agencies, and NGOs related to climate change issues.

(iv) The national energy plan integrating all actions in both supply and demand sides.

(v) The agroforestry sector program including forest protection, watershed management, biodiversity conservation, reforestation, and settlement of shifting cultivation.

(vi) The program of intensifying cultivation of food crops. (vii) A climate change education and training program to strengthen human

capacity including medium- and long-term plans for decision makers and planners from all relevant Ministries and Government Agencies.

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RECOMMEDATIONS FOR

FUTURE ACTIONS

PAGE 211

Energy

Forestry

Agriculture

SECTION 9

9.2 TIME-LINE FOR

IMPLEMENTATION

TABLE 9-1 IMPLEMENTATION OF ABATEMENT

INITIATIVE OPTIONS

PAGE 212

RECOMMENDATIONS FOR

FUTURE ACTIONS

ShortTerm (1998-2000)

(i) Strengthen the established organization in order to implement Climate Change Action Plan.

(ii) Disseminate the Country Program for implementing UNFCCC in order to include it in the existing plans, programs, and future national development plans.

(iii) Design proposal projects for funding. (iv) Develop monitoring and evaluation procedures on GHGs emissions

(v) Promote public awareness of climate change. (vi) Implementation of high efficiency measures for demand-side manage-

and abatement.

ment of the energy sector.

Medium Term (2001 -201 0)

(i) Implementation of technical assistance and investment projects taking into account the reduction of GHGs emissions or enhancement of GHGs sinks; and

(ii) Substitution to the less-GHGs-emitting fuels in the energy sector.

Long Term (beyond 2010)

(i) Continue public information campaign. (ii) Implement other investment projects on designing and applying new

(iii) Identify and diversify primary energy sources with special attention efficient technology in the energy supply and demand sides.

given to the most important and GHGs clean energy sources: Hydro, Nuclear, Wind, Geothermal, and Biomass.

Implementation of GHGs abatement initiatives is divided into three time- lines and presented in Table 9-1.


Fuel switching Forest Water management conservation in the field with

Wind power construction intermittent draining Enhanced during growing

Improving the efficiency in cooking natural season be regeneration researched and

CFL developed in the pilot Reforestation areas such as of Red

Highly efficient air conditioning River Delta Revegetating

Highly efficient refrigerator bare hills and Establishing the planting network of plants for

Highly efficient electric motors scattered trees production of animal feed with mechanical and chemical processing

VIET NAM

Energy Forestry Agriculture

SECTION 9

Wind power and other new and Forest Continue water renewable energy development protection and management in the

Improvement of efficiency in demand side Enhanced Improved efficiency

conservation rice fields of Mekong River Delta.

natural of animal feed regeneration particularly for the

Reforestation buffalo

Planting Introducing and scattered trees transferring the

non-dairy cattle and

Application of new technology supply Forest Continue with 5.5 side conservation million ha of rice field

Improvement of efficiency in demand Enhanced management. 4.4 side natural million head of

Substitution by less GHGs emitting fuels Reforestation improved nutrition

Planting and chemical feed scattered trees processing

under water

reforestation buffaloes and cattle provided with

through mechanical

For the energy sector, the implementation of mitigation options can be supported by energy institutions such as State oil and gas companies, the Viet Nam electricity company, the industry sector, commercial banks, including ADB and World Bank. The GEF and funding sources from other international, financial, and technical organizations may be involved. Individual countries will be also requested for financial assistance for implementing the abatement initiatives in the energy sector.

For the forestry sector, the implementation of several mitigation options can engage financial institutions like the Vietnamese Reforestation and Forest Protection Fund, and receive credits from State Bank and Bank for Agriculture and Rural Development, State plantation enterprises, Agro-forestry Department, and, for relevant programs or projects, from World Bank, ADB, or GEF. Credits from non-refundable aids, foreign investment, and people’s capitals can also be mobilized to implement the mitigation options.

For the agriculture sector, the implementation of mitigation options can be financed from the State budget through the Ministry of Agriculture and Rural Development, from local Government through the Department of Agriculture and Rural Development of Provinces, and from Agricultural Agency, the farmers, and NGOs. Credits from the Bank of Agriculture and Rural Development are also provided to the agriculture sector. However, mitigation options that relate to capacity building and technical assistance can engage GEF, World Bank, ADB, international organizations, and donor governments.

VIET NAM

RECOMMEDATIONS FOR

FUTURE ACTIONS

9.3 ENGAGING THE FINANCIAL

COMMUNITY

PAGE 21 3

technology to farmers


Energy Forestry Agriculture


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