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The Energy Efficiency Working Group’s proposal was one of the winners of the TUEWAS innovation fund competition. Source: freepik.com
GIZ internal sector network TUEWAS (Transport, Environment, Energy and Water in Asia) called for proposals in May 2020 for innovative and feasible ideas from its Working Groups. Amidst intense competition, the project concept of Digital Small Energy Efficiency Working Group (SEEG) was adjudged the joint best with another idea that falls within the transport and environment Working Group and was rewarded with €25,000.
The project focuses on establishing SEEGs at a regional level to support industrial and commercial sectors of the four TUEWAS member countries. This will serve as a place where members can improve technical, financial energy efficiency project appraisal, proposal preparation and presentation skills, and also create chances to expand energy efficiency networks.
GIZ internal sector network TUEWAS was established in Germany in 2002, as a platform for regional professional exchange and cooperation between GIZ experts in Asia and the head office. Currently, TUEWAS connects over 60 projects across 16 Asian countries. TUEWAS Energy Efficiency Working Group promotes the exchange of knowledge and experience in energy efficiency in Asia.
To encourage the development of innovations, TUEWAS Steering Group considered an Innovation Fund as an effective mode to provide financial support and a stimulus for innovative activities. Therefore, the TUEWAS Steering Group announced on May 5, 2020 the Innovation Fund 2020.
To strengthen the cooperation and to improve the sharing of sector-specific knowledge among member projects, the TUEWAS EE Working Group developed an innovative idea of “Introducing a facility in-house mechanism to trigger energy efficiency behaviour among industrial consumers through online support to increase the productivity and mitigate carbon emission” and submitted the application on June 18, 2020. By the result announcement on June 26, 2020 the speaker and co-speaker of the Working Group were informed according to the vote result, that the idea and the applied amount of €25,000 was approved by the TUEWAS Steering Group.
This initiative concerns pilot testing a strategy that may in the mid-term lead to a better recognition of energy savings as the least-cost energy resource of any facility and may even lead to trading of energy savings under a changed legal framework. The focus is on establishing SEEG in Vietnam, Bangladesh, India, and Nepal lead by an energy manager (EM) with the mandate to identify, prepare, present, and defend as a team energy saving opportunities to the management board for funding. This should be implemented only by online coaching the SEEG to improve their technical, financial energy efficiency project appraisal, as well proposal preparation and presentation skills. In each of the four countries three industrial companies will be selected by the staff of GIZ within the country.
Vietnam features high energy intensity compared to other international contexts. In 2015, the primary energy intensity with respect to GDP was 20 GJ/USD (IEA, 2017), while the world average amounted to 8 GJ/USD. With the issuance of the Law on Energy Efficiency and Conservation in 2010, many Energy Efficiency (EE) activities have been carried out throughout the country covering different economic sectors, with good progress in the application of EE measures for user appliances and partly also in industrial facilities. On the other hand, EE has not been well promoted in the building and transport sectors.
One of the main effects of the application of EE measures is a reduction of the total energy system costs already in 2030, where a large decrease in fuel costs and a reduction of the power demand can more than offset the increase in the investments in the end-use sectors.
According to the Vietnam Energy Outlook Report 2019, even though additional investment in EE technologies amounted to $7 and $16 billion (annualised) in 2030 and 2050 respectively, a large share of fuel costs and investments in the power sector can be saved, thus resulting in an overall reduction of the annual total system cost of 8.9 and 10.6 per cent in 2030 and 2050.
In the industrial sector, cement, iron and steel, textile, and food are the main subsectors for EE improvements. EE measures in heat processes contribute to 61 per cent of the total energy saved followed by machine drive (21 per cent) and facilities (18 per cent ) by 2030.
In the period to 2050, EE improvement in the cement, iron and steel, pulp and paper, food, and textile subsectors is the most important area for realising the energy saving potential. Under industrial machine drive, efficient motors and variable speed drive applications are also important in all subsectors, especially for iron and steel and textile production after 2030.
The report noted that the successful and cost-effective transition of the energy system requires both higher penetration of renewable energy and a reduction in energy consumption through EE and energy conservation measures. Vietnam has a large potential for EE and the Energy Outlook Report 2019 shows that EE can significantly reduce total energy system costs through investments in energy efficient technologies and improvement of manufacturing processes. Investments in end-use efficient devices (for example industry and residential sectors) have the potential to reduce the energy demand, in turn resulting in a reduced need for investments in additional power plant capacity. However, Vietnam faces the challenge of efficiently exploiting the full potential in energy savings, due to barriers at the institutional and financial level.