Problem

Reducing the energy consumption attributed to buildings in Vietnam, as well as associated greenhouse gas (GHG) emissions, is a key step in working toward a low carbon economy. In 2012, the International Finance Corporation (IFC) estimated a 400 percent increase in national electricity consumption over the previous ten years, primarily attributed to industry, construction and the residential sector. As part of the World Bank’s assistance to the Government of Vietnam to develop a national low carbon options assessment, ICF analyzed potential energy reductions from improved implementation of the existing Vietnam Building Energy Efficiency Code (VBEEC). Implementation of the requirements had been negligible since it was issued in 2005 due to low awareness among stakeholders, complicated calculation requirements and a lack of focus on measures appropriate for Vietnam’s market and climate conditions.

Solution

This project concentrated on evaluating support mechanisms for the VBEEC to foster widespread increases in energy efficiency and improved building construction and performance. For successful code implementation, coordinated activities were essential in the following three areas:

1. Policy Framework to set goals and dedicate funding to support implementation activities.
2. Technical Guidance that clearly defines energy efficiency techniques and technologies which are appropriate for the climate, are cost-efficient and are available in the local market.
3. Market Capacity to value the financial returns from energy-efficient buildings, as well as the skills and knowledge required to design, construct and operate buildings.

The ICF team mapped activities in these three areas to identify where current and planned projects were targeting important implementation barriers for the VBEEC and where other barriers were being missed. The approach aimed to (1) focus government time effectively on the most important activities for sustainable code implementation; (2) facilitate long-term activity to increase energy efficiency expertise and awareness; and (3) improve stakeholder and international donor coordination to encourage cost-effective use of funding and continued progress toward government goals.

Findings showed significant opportunities to leverage existing activities. A number of organizations were providing expertise, training and resources to the government and other stakeholders. These included the Vietnam Association of Civil Engineering Environment (VACEE), the Vietnam Green Building Council and local energy conservation centers. There was also significant assistance from active international donors, many targeting activities toward improving the energy efficiency of buildings. In addition, the central government was providing leadership on green economic growth through new policy that included reductions in building energy consumption.

Drawing on international best practices, the project closely examined actions taken, and provided recommendations on how some existing and planned activities could be expanded to improve the effectiveness of the code and address gaps in policy, technical guidance and market capacity. For example, despite a new Green Growth Strategy and a number of laws on construction and energy efficiency, many gaps remained including roles and responsibilities for implementing national policy on building energy efficiency, standardized processes for implementing the VBEEC, government action to lead by example, and enforcement mechanisms for not complying with code requirements.

Innovation

ICF produced a policy brief for the Government of Vietnam with a roadmap of recommended near-term and long-term activities to move toward successful and sustainable implementation of the VBEEC. The project team identified existing policies that align with Vietnam’s Green Growth Strategy and determined modifications to enhance policy harmonization, proposed policies to fill in the gaps of existing building code requirements, and identified necessary actions to successfully expand market capacity (including stakeholder outreach, education and training).

The Roadmap provides a framework for both government and non-government activities to complement each other, achieve energy savings and work toward transforming the building sector in Vietnam.

Challenges

This project highlighted two specific challenges, both related to communication and coordination. First, among the various international donors active in Vietnam, several were identified as focusing on the opportunity to reduce GHG emissions through improved implementation of the existing building energy efficiency code. However, it became clear that donors were not sharing information and coordinating their activities to make the best use of resources. Similarly, local ministries and agencies were not coordinated on the construction process which, by law, requires permits, reviews and other steps to ensure adherence to regulations. Both of these types of gaps were not apparent from desk research or through a small number of interviews since most stakeholders assume that coordination occurs and processes run as they were designed.

Lessons Learned

The Government of Vietnam set in motion policies to successfully reduce energy consumption in building sector. However, significant gaps in policy and other areas required strong action to overcome barriers and move the market forward in a sustainable manner. Breaking actions down into a focused near-term approach to remove obstacles, with longer-term activities to scale up activity, was presented as a manageable and effective strategy fitting with the government’s goals for green growth. The Roadmap provided specific implementation recommendations and summarized benefits for three near-term government actions: (1) Establish a national VBEEC enforcement process; (2) Promote mandatory energy performance standards for building materials and equipment; and (3) Coordinate activities among international donors to focus on large-scale demonstration projects, as well as training and technical support.