Dr. Nguyen Tien Nguyen Dr. Nguyen Duc Minh Reseach Centre for Energy and Environment

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Dr. Nguyen Tien Nguyen Dr. Nguyen Duc Minh
Reseach Centre for Energy and Environment
GHG MARKET OPPORTUNITIES OF VIETNAM AND CAPACITY
DEVELOPMENT REQUIREMENT
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ASSESSMENT OF GHG REDUCTION POTENTIAL

• Sectors Energy, Agriculture and Foresty
• GHG mitigation options in Vietnam

Sector Options Energy Agriculture Forest
Saving Efficiency x
Renewable energy x
Fuel switching x
Avoid leakage x
Irrigation of rice fields x
Animal food x
Residue Agriculture - biogas x
Afforestation x
Reforestation x
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EVALUATION OF GHG REDUCTION POTENTIAL

• GHG reduction potential (or also referred as GHG
  Natural resources) is evaluated by reduced amount
  and reducing cost.
• This ostentation is performed in curve Marginal
  Abatement Cost (MAC). Amount of GHG mitigation
  and costs is expressed by this curve

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MAC of some countries
MAC
350.00
300.00
250.00
200.00
Abatement cost /tC
150.00
100.00
50.00
0.00
0
100
200
300
400
Reduction amount mtC
US
Japan
China
India
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MAC APPLYING

• Potential demand can be estimated by MAC total
  from countries included Annex I while MAC total
  from non Annex I countries provides supply
  potential. As a result, carbon price of the World
  will be determined in different circumstance of
  market
• If we know carbon price and MAC curve of one
  country we can calculate exporting capacity and
  its benefit. An example is presented below

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MAC APPLYINGA1 A2 B Exporting turn-over. B
Benefit A1 Transaction cost
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MAC ESTABLISHING FOR VIETNAM

• Bottom up method
• From each option (15 energy options, 3
  agriculture options) MAC curve is developed
• This method give us bottom value because do not
  calculate all options ( for example, at present
  we lack transportation options)
• Top - down method
• Using assessments and macro projection to
  estimate GHG reduction amount, then multiply with
  possible coefficients to obtain the top value.
• Vietname MAC Curve in 2010 is presented in the
  following figure

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• Vietnamese MAC LINE

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VIETNAME MARKET POTENTIAL

• Carbon Price in the World (In case of selling
  and purchasing are not limited)
• With United States (US) participation 5.26/
  t CO2
• Without US participation O / t CO2
• Vietnamese potential (Table 2)

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VIETNAME MARKET POTENTIAl
Scenario Vietnam Vietnam Vietnam Trung Quoc Trung Quoc Trung Quoc Annex I Countries Annex I Countries Annex I Countries
US Export Turnover (mtC) Profit Export Turnover (mtC) Profit Export Turnover (mtC) Profit
With US participation 2.8 53.7 25.7 170 5080 3330 431 7580 4300
Without US participation 0 0 0 0 0 0 0 0 0
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CAPACITY DEVELOPMENT REQUIREMENT

• From above presented contents we realize that the
  needs for capacity development are
• Potential survey is also limited because of
  lacking manpower, experience and finance. GHG
  mitigation options is not sufficient.
  Transportation sector is not taking into account
  when surveying. Baseline, reduction costs under
  several options need calculating in more
  detail...
• To strengthen competition we need to have rules,
  procedures, agencies and staffs to reduce project
  cost and progress to implement project. Benefit
  is directly proportional with progress of project

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CAPACITY DEVELOPMENT REQUIREMENT

• 3. National coordination in effective manner has
  good effects to
• Project implementation progress
• Integration of small projects that not attract
  CDM into large project (bundle) with higher
  competition
• Formulation strategy and guidance in negotiation
  of project conditions such as (technology
  transfer, Carbon price), and avoidance of bad
  condition.

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CAPACITY DEVELOPMENT REQUIREMENT

• Having sensibly coordination to protect GHG
  resources to avoid sale all with cheap carbon
  price. (low hang fruit )
• 4. Above requirements can be implemented in case
  of
• Having National CDM strategies and policies
• Having strong coordinating agencies
• Having senior experts and experienced consultants
• Having officers, staffs with CDM basic knowledge
  at sectoral level