Exploring a Low-Carbon Development Path for Vietnam

by Pierre Audinet, Bipul Singh, Duane T. Kexel, Suphachol Suphachalasai, Pedzi Makumbe

Overview

Bringing together a large set of data and building on two years of consultations in Vietnam with Government counterparts, research organizations, state-owned enterprises, private sector and Vietnam international development partners, the report formulates two scenarios to explore and analyze Vietnam's options up to the year 2030: a business as usual and a low carbon development scenario. Based on a thorough data modeling effort for the key carbon emitting sectors of Vietnam, the report also provides some policy guidance for the Government’s consideration. This report is also unique as it brings together and presents data on multiple sectors of Vietnam's economy, making this information available for future reference. This effort is the result of two years of collaboration with the Government of Vietnam as part of the Vietnam Low Carbon Options Assessment technical assistance. By highlighting several economic opportunities and clarifying the issues at hand, this work is a milestone in this complex debate and I believe will help all stakeholders willing to consider and responsible to design the policies and measures to address those challenges.

Product Details

ISBN-13:	9781464807190
Publisher:	World Bank Publications
Publication date:	12/31/2015
Series:	Directions in Development - Environment and Sustainable Development
Pages:	156
Product dimensions:	7.00(w) x 10.00(h) x 0.40(d)

Table of Contents

Foreword xi

Acknowledgments xiii

Executive Summary xvii

Abbreviations xxiii

Chapter 1 Tire Case for Low-Carbon Development 1

Overview 1

Vietnam's Economic and Emissions Performance 1

Business as Usual versus Low-Carbon Development 5

Notes 9

Bibliography 9

Chapter 2 Low-Carbon Development Scenario 11

Overview 11

Introduction 12

Methodology: The BAU and LCD Scenarios 13

The Business-as-Usual Scenario 13

The Low-Carbon Development Scenario 14

Toward Low-Carbon Development 16'

Achieving Green Growth Targets 19

The Economics of Low-Carbon Development 21

Key Recommendations 25

Notes 25

Bibliography 27

Chapter 3 Energy Efficiency in Industrial and Household Sectors 29

Overview 29

Introduction 29

Energy Efficiency and Financial Competitiveness 33

Energy Efficiency at the Household Level 37

Energy Efficiency: An Implementation Gap Assessment 38

Key Recommendations 40

Notes 42

Bibliography 42

Chapter 4 Decarbonizing the Power Sector 45

Overview 45

Displacing CO₂-Emitting Coal-Fueled Power Plants to Achieve Low-Carbon Development 46

Low-Carbon Development and Energy Security 58

Key Recommendations 62

Notes 64

Bibliography 65

Chapter 5 Sustainable Transportation and Urban Planning 67

Overview 67

Low-Carbon Development in the Transport Sector 67

Integrated Land-Use Planning 71

Note 72

Bibliography 72

Chapter 6 Macroeconomic and Electricity Pricing Implications 73

Overview 73

Introduction 73

Macroeconomic Implications 74

Electricity Pricing Implications 77

Mitigating Adverse Impacts 78

Notes 79

Bibliography 80

Chapter 7 Policy and Institutional Measures 81

Introduction 81

Area 1 Energy Price Reform 81

Area 2 Increasing the Energy Efficiency of Households and Industry 82

Area 3 Promotion of Gas in the Power Sector 83

Area 4 Use of Supercritical Coal Combustion Technology 83

Area 5 Renewable Energy 84

Area 6 Sustainable Transport 85

Area 7 Cross-Cutting Reforms to Promote LCD 86

Note 87

Bibliography 87

Appendix A EFFECT Model 89

Appendix B Marginal Abatement Costs 91

Appendix C Electricity Revenue Requirements Model 105

Appendix D Computable General Equilibrium Model 109

Appendix E Key Assumptions 113

Appendix F Data Tables 119

Appendix G Electricity Generation Capital and Fuel Expenditures by Scenario 127

Figures

ES.1 CO₂ Emissions Reductions Proposed, Relative to Business as Usual xviii

1.1 Vietnam's Annual GDP Growth, 2000-12 2

1.2 Changes in Carbon Dioxide Emissions in Select Nations and Regions, 2000 10 4

1.3 Vietnam's Change in CO₂, Emissions per GDP Compared with Select Nations and Regions, 2000-10 5

1.4 Carbon Dioxide Emissions under the Business-as-Usual Scenario 6

1.5 Share of Increase in CO₂ Emissions under BAU Scenario, 2010-30 7

2.1 CO₂ Emissions: Business as Usual vs. Low-Carbon Strategy, 2010-30 17

2.2 Share of Cumulative Emissions Reductions: LCD Scenario, 2010-30 18

2.3 Emissions Reductions under LCD Scenario. 2010-30, Relative to BAU 20

2.4 Emissions Intensity and Emissions per Capita, 2010-30, BAU vs. LCD Scenarios 21

2.5 Vietnam's Marginal Abatement Cost Curve, 2010-30 23

3.1 Reduced Electricity Generation Capacity Additions: EE$10 vs. Business as Usual 31

3.2 Electric Demand Reductions at the Consumer Level 33

3.3 Marginal Abatement Cost Curve for Industrial Sector Energy Saving (Electricity and Fossil Fuels) 34

3.4 Marginal Abatement Cost Curve for Industrial Sector Electric and Energy Savings Options 35

3.5 Iron and Steel Producers: Marginal Abatement Cost Curves 36

3.6 Small Steel Producers: Marginal Abatement Cost Curves 36

3.7 Cement Sector: Marginal Abatement Cost Curves 37

3.8 Household Sector: Marginal Abatement Cost Curves 37

3.9 Framework of a Typically Successful Energy Efficiency Program 39

4.1 Electricity Generation Capacity Added Net of Energy Efficiency Gains 46

4.2 Peaking Share of Total Installed Capacity, by Scenario, 2010-30, MW 50