Climate Protection through Sustainable Bioenergy Markets in Viet Nam

To improve the preconditions for the sustainable use of biomass residues for power and heat production

The Climate Protection through Sustainable Bioenergy Markets in Viet Nam (BEM) project is playing a crucial role in supporting the Vietnamese Government in increasing the share of bioenergy in the country’s overall power mix. Set to run from 2019 until 2023, BEM aims at improving the preconditions for sustainable use of bioenergy for electricity and heat generation in Vietnam.

Key activities include supporting regulatory adjustment to planning and licensing biomass energy projects; improving the private sector’s capacities to develop biomass ventures and enhance financial institutions’ capacities to finance such ventures; and facilitating technology co-operation between Vietnamese and international enterprises, research institutions, and universities on the use of biomass for electricity and heat generation.

BEM is funded by the German Federal Ministry for the Environment, Nature Conservation and Nuclear Safety (BMU) through the International Climate Initiative (IKI). The project is implemented by the Electricity and Renewable Energy Authority (EREA), which is a subordinate of Vietnamese Ministry of Industry and Trade (MOIT), and the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH, which is a federal enterprise supporting the German Government in achieving its objectives in the field of international cooperation for sustainable development.

• Technical advisory support
• Workshops
• Training courses
• Matchmaking events
• Research/study/report

Policy makers, local authorities, private sector, financial institutions, research institutions, universities, experts

Legal and regulatory framework:

• Support the development and implementation of framework conditions and official decisions related to biomass and biogas feed-in tariffs;
• Study the integration of bioenergy in Vietnam’s new master plan on power development (Power Development Plan 8);
• Update Biomass energy project development guidelines’ for investors/developers

Capacity Development:

• Face-to-face and virtual training on the legal and regulatory frameworks for national/provincial officials, consulting firms, project developers, investors and financial institutions

Technical cooperation:

• Business-to-business activities and match-making events between Vietnamese and international stakeholders
• Identification of lighthouse projects for innovative biomass technology or commercial approaches

Updated biomass energy project development guidelines: Lodestar for investors in Vietnam

Vietnam has a huge potential of biomass for energy generation, but investors need to deal with many government institutions for a variety of permits and licenses when pouring capital into this sector. Clearly and systematically summarizing the licensing process will make it easier for investors to participate in the market and develop projects.

As a part of the BMU-funded Climate Protection through Sustainable Bioenergy Markets in Viet Nam (BEM) project, the newly updated ‘Biomass energy project development guidelines’ handbook is expected to assist investors in reducing risks before and during their projects’ implementation. Following the document, they can better understand administrative procedures and processes in all stages of developing grid-connected biomass power projects – from the design, implementation, operation & maintenance, all the way to decommissioning.

The handbook was first introduced by GIZ and Vietnam’s Ministry of Industry and Trade in 2017. The current revision is necessary as the government has issued new legal documents including the planning law and new biomass feed-in-tariffs and revised the Power Purchase Agreement for biomass power projects.

The handbook is expected to contribute to the country’s effective development of the renewable energy market and its climate change goals.

Virtual events bridge international and local developers in Vietnam’s bioenergy market

Business-to-business and matchmaking activities are an efficient method to connect companies, so the BMU-funded Climate Protection through Sustainable Bioenergy Market in Viet Nam (BEM) project originally planned the activities in-person. However, due to the COVID pandemic, the first bioenergy matchmaking events were shifted to innovative digital modes and the early results have been very promising despite technical challenges.

From March until November 2020, three virtual matchmaking events were organised for woody biomass stakeholders to receive overview information for the country’s sector development, including updates on the legal framework and support mechanisms.

Then, two sets of events were conducted to connect national project developers with international investors/developers: 1) all registered participants had five minutes to pitch their biomass projects/ideas/portfolio before they could select a suitable counterpart, and 2) one-to-one sessions for each pairing.

After the meeting, at least five site visits have been organised among local companies, and even more online exchanges have been conducted between local and international businesses. Notably, an overseas investor connected with a local developer and plans to travel to Vietnam to sign a memorandum of understanding as a substantial step toward project realization.