CDM Feasibility Study for Installation of Solar Water Heating Systems in Viet Nam

Global Environment Centre Foundation(GEC)

Reports of CDM/JI Feasibility Studies

Title of Feasibility Study (FS)CDM Feasibility Study for Installation of Solar Water Heating Systems in Viet Nam
FYFY 2008
Main Implementing EntityMitsubishi UFJ Securities Co., Ltd.
FS Partner(s)Energy Conservation Center of Ho Chi Minh City
Location of Project ActivityViet Nam
Summary of FS ReportSummary (PDF190KB)
Description of Project ActivityIn the project activity, Energy Conservation Center of Ho Chi Minh City(ECC) will promote the installation of solar water heating (SWH) systems by providing subsidies to the consumers. Electricity demand has rapidly grown with economic development in Viet Nam and stable supply of electricity is positioned as one of the most important issues to be tackled. The ECC aims to install SWH systems in South of Viet Nam and reduce electricity consumption. In this Study, the feasibility of implementing the Project as programmatic CDM is investigated.
Targeted GHGCO2
Category of Project ActivityRenewable Energy
Duration of Project Activity/ Crediting PeriodCrediting period of PoA (28 years): 2009-2036
The first CPA (7 years × 1 renewal): 2009-2022
Baseline Scenario (including Methodology to be applied)The baseline and monitoring methodologies of approved small-scales methodology (AMS) I..C, "Thermal energy for the user with or without electricity" is applicable to the Project. In the absence of the project activity, people would utilize electric water heater to supply heated water. Therefore, the baseline emissions of the Project are the amount of greenhouse gases emitted when the energy displaced by solar energy is supplied from grid electricity.
Demonstration of AdditionalitySWH system installation project will not take place in the absence of the project activity. This is justified by 1) investment barrier, 2) technological barrier and 3) barrier due to prevailing practice.
Estimation of GHG Emission ReductionsThe annual average GHG emissions reduction from the first CPA of the Project is 15,716 tCO2.
Monitoring Plan (including Methodology to be applied)In accordance with AMS I..C, the following two items are required to be monitored for projects where emissions reduction per unit of system is less than 5tCO2.
    • 1) The number of systems operating

    2) Annual hours of operation of an average system
The above monitoring method is applicable as the emissions reduction per unit of SWH system installed in the project activity is less than 5tCO2.
Environmental Impact AnalysisEnvironmental impact assessment is not required for the Project in Viet Nam. The Project will not impose any negative impact on the environment.
Issues and Tasks for Project MaterialisationThe budget for implementing the Project is limited to installing 22,000 units in 5 years. This budget is not a stable source of funding as it will be distributed upon ECC's application to Ho Chi Minh City People's Committee and Ministry of Industry and Trade every year. It is important to generate CER sales revenue by implementing the Project as CDM and create a new source of subsidy so the Project can be continuously operated. As the emissions reduction depends on accumulative number of installed SWH systems, therefore, it is important to install as many units as possible in the early stage of the crediting period to secure maximum amount of CERs. By implementing the Project as CDM, investment from private businesses is expected to be facilitated. By doing so, it will be possible to install more units in the early stage which will, in turn enable sustainable and continuous operation of the Project through use of CER sales revenue.
Co-benefits EffectsIt is expected that the Project will contribute to stable supply of electricity and prevention of blackouts by reducing electricity consumption. It is also hoped that through supplying safe and stable heated water, the Project will contribute to improvement of life quality of Vietnamese people. Also, ECC's advertisement campaign to disseminate SWH systems will not only inform the public of their economic benefits, but will also raise awareness of environmental impact of renewable energy use as well as energy and environmental problems. It is believed that these co-benefits of the Project can be evaluated through resident survey.