P
ROJECT
T
ITLE
:

V
IETNAM
:

E
NERGY
E
FFICIENT
P
UBLIC
L
IGHTING
(VEEPL)

P
ROJECT

Project
3,000,000
GEF

A
GENCY
:

U
NITED
N
ATIONS
D
EVELOPMENT
P
ROGRAMME
(UNDP)
PDF-A
0
O
THER
E
XECUTING
A
GENCY
(
IES
):

N.A.
PDF-B (GEF)
309,900
GEF

F
OCAL
A
REA
:

C
LIMATE
C
HANGE

Sub-Total
3,309,900
GEF

O
PERATIONAL
P
ROGRAMME
:

OP-5
Co-Financing

D
URATION
:

5

Y
EARS

PDF B 65,000
GEF

S
TRATEGIC
P
RIORITY
:

(S1)

T
RANSFORMATION OF
MARKETS FOR HIGH
-
VOLUME
,
COMMERCIAL
,
LOW
GHG

PRODUCTS OR PROCESSES

E
STIMATED
S
TARTING
D
ATE
:

J
ULY
2004


IA

F
EE
: US$ 382,000

Government Agencies
(VAST, MOC, IMS, HUT,
IET, VTV-2, and
QUATEST1
1,408,000
C
ONTRIBUTION TO
K
EY
I
NDICATORS IN THE
GEF

B
USINESS
P
LAN
:
Cumulative GHG reduction equivalent to 133.5 ktons of
CO
2
by end 2009.
Cumulative energy savings of 310.5 GWh by end 2009


Local Governments (Ho
Chi Minh City, Quy Nhon,
Hue, Vinh, Ha Tinh, Tuy
Hoa, and Quang Ngai)
8,120,000
55% EE lighting equipment in new installations and
replacements in urban street lighting by end 2009
28% EE lighting equipment in new installations and
replacements in rural street lighting by end 2009
29% EE lighting equipment in new installations and
replacements in hospitals and school lighting by end
2009.

Lighting Products
Manufacturers (Hapulico
Co., Vietnam Schreder
Co., Viettronics Dong Da
Co., Dien Quang Lamp
Co., and Vinakip Co.
2,790,000

Sub-Total
12,383,000

Total Project Cost
15,692,900





R
ECORD OF
E
NDORSEMENT ON
B
EHALF OF THE
G
OVERNMENT


Mr. Pham Khoi Nguyen, Chairman of GEF Vietnam
Ministry of Natural Resources and Environment (MoNRE)

Date:


Approved on behalf of the United Nations Development Programme (UNDP). This proposal has been
prepared in accordance with GEF policies and procedures and meets the standards of the GEF Project
Review Criteria for work program inclusion.
Yannick Glemarec
Deputy Executive Coordinator, UNDP-GEF
Manuel L. Soriano
GEF Regional Coordinator (Climate Change)
Date:
Tel: 60-3-20915153

PROJECT EXECUTIVE SUMMARY
2
1.

PROJECT SUMMARY

a.

P
ROJECT RATIONALE
,
OBJECTIVES
,
OUTPUTS
,
AND ACTIVITIES
.

The overall goal of the project is to build both technical and policy support for a transition to
more energy efficient public lighting in Vietnam. By increasing the energy efficiency of public
lighting installed over the next 10 years, the project will significantly reduce electricity
consumption by the public lighting sector in Vietnam compared to what it otherwise would have
been. Reducing electricity consumption will reduce emissions of GHG from the Vietnamese
electricity generation sector. Although VEEPL specifically targets public lighting (street lighting,
public spaces and public buildings), the technical capacity and policies established through the
project will support lighting efficiency efforts in other sectors as well.

The Vietnamese markets for public lighting in general, and energy efficient public lighting in
particular, are immature and disorganized. Classic market failures of insufficient information and
insufficient investment capital typically result in communities making sub-optimal public lighting
investment choices. The lifecycle cost benefits of energy efficient public lighting are not well
understood by purchasers, or financial organizations. Therefore, communities tend to choose
lighting options with the lowest initial capital cost, but are then saddled with higher than
necessary electricity operating costs. Finally, low market volume and a lack of significant local
production also tends to drive up the price of energy efficient public lighting products compared
to conventional equipment, further exacerbating the market failure.

b.

K
EY INDICATORS
,
ASSUMPTIONS
,
AND RISKS
(
FROM
L
OG FRAME
)

This project is designed to address these and other barriers to the development and
implementation of energy efficient lighting in the public sector in Vietnam. To achieve this
objective, the project is organized into five components: (1) Policy Development; (2) Technical
Support; (3) Financing; (4) Technology Demonstration; and, (5) Information Dissemination and
Awareness Raising. With the planned activities, VEEPL will cumulatively avoid greenhouse gas
(GHG) emissions from fossil fuel-based power generation in Vietnam in the order of 1,730 kTon
of CO2 equivalent through the year 2013. This corresponds to an average 20 % improvement in
the overall efficiency of public lighting systems in 86 cities and towns by 2013.

Progress towards achievement of the project objectives will be tracked through lighting energy
consumption reports submitted by participating cities and towns to the MoC. To some extent,
similar information may be obtainable through lighting manufacturers and companies responsible
for the installation of public lighting. VEEPL assumes that Vietnamese cities and towns are
willing and able to respond to improved information and access to improved products and will
choose more economically, and environmentally, optimal public lig hting options.

2.

COUNTRY OWNERSHIP

a)

C
OUNTRY
E
LIGIBILITY


Vietnam ratified the UNFCCC on 16 November 1994.

b)

C
OUNTRY
D
RIVENNESS


On September 3, 2003 the government of Vietnam issued a Decree on Energy Conservation and
Efficiency that recognized the potential benefits from effective implementation of policies to
3
encourage end-use energy efficiency. The decree defines an administrative structure and
responsibilities for a coordinated set of directions, requirements, regulations and enforcement for
the application of energy efficiency and energy conservation measures in all segments of the
economy. In addition, the GOV report Potential for Energy Efficiency Improvement in Lighting
in Vietnam (1997) recommended programs to reduce lighting energy consumption in the
transportation, industrial, commercial and the domestic sectors. The recommendations related to
Public Lighting received further support that led to the GEF-supported PDF-B exercise.

3.

PROGRAM AND POLICY CONFORMITY

a)

P
ROJECT
D
ESIGN


The economic advantage provided by energy efficient lighting means that the market for public
lighting, in Vietnam and elsewhere, should eventually transform to higher levels of energy
efficiency on their own. The project is designed to realize this advantage, by accelerating energy
efficient lighting market transformation, whereby the penetration of energy efficient lighting
equipment and practices will occur more quickly. The benefits of avoided GHG emissions and
kWh costs will be created as the VEEPL is expected to cause more efficient public lighting to be
installed sooner than otherwise would have happened.

In Vietnam, certain barriers slow down the penetration of energy efficient lighting, and in some
cases prevent market transformation altogether. The result is the persistence of inefficient
lighting, needlessly wasted electricity, and avoidable GHG emissions. The critical barriers that
prevent Vietnamese consumers, organizations and government agencies from choosing
economically and environmentally optimal public lighting, are: (1) Lack of a national
professional academic and technical network on lighting; (2) Absence of energy consumption
reporting and monitoring; (3) Low level of awareness about energy efficient public lighting
options and their benefits; (4) Lack of effective policies for public lighting; (5) Lack of
appropriate training and skills for personnel in the public lighting sector; (6) Limited availability
of some energy efficient lighting products; (7) Lack of funds for public lighting systems; and, (8)
Lack of financing for energy efficient public lighting systems.

The VEEPL project is designed to overcome these barriers with a comprehensive and coordinated
array of technical, policy and informational resources. The project activities have been tailored
for use by targeted public lighting stakeholders, and designed to be both sustainable and
replicable. VEEPL will work to ensure that both national and local governments in Vietnam can
access public lighting technologies and practices at the international standard level. The following
are the various components of the VEEPL project:

COMPONENT 1: PUBLIC LIGHTING POLICY DEVELOPMENT. This component involves
the implementation of activities aimed at strengthening and improving the policy and regulatory
framework to encourage feasible EE public lighting projects in Vietnam.

COMPONENT 2: PUBLIC LIGHTING TECHNICAL SUPPORT PROGRAM. This component
consists of activities that strengthen the capacity of relevant GOV agencies on EEL product
testing, market monitoring and enforcement of standards with consumers. This will establish the
potentials and requirements for the application of EE public lighting systems, as well as the
support provisions for such initiatives.

COMPONENT 3: PUBLIC LIGHTING FINANCING PROGRAM. This component is made up
of activities aimed at encouraging the government, financial/banking and private sectors, to
4
provide financial assistance to the development and implementation of EE public lighting system
projects.

COMPONENT 4: PUBLIC LIGHTING SYSTEM DEMONSTRATION PROGRAM. This
component includes the implementation of activities aimed