Vietnam’s economy has grown by over 7% annually during the past two decades, and 6% annual growth is expected for the next two. Economic development has brought millions of new inhabitants to Vietnam’s fast-growing cities, estimated to be home to 43% of Vietnam’s population by 2030, compared to 25% in 2002. Urbanization and economic growth have fueled a rapid rise in Vietnam’s energy consumption. Annual energy demand has grown by an average of 13% over the past decade, resulting in a 50% increase in the energy intensity of Vietnam’s economy. By 2030, energy consumption and energy-related greenhouse gas (GHG) emissions are expected to double and triple, respectively. Vietnam’s expanding energy demand is driven by the use of fossil fuels in heavy industry, motorized transport, and power generation.
...the estimated amount of CO2 equivalent emissions expected to be avoided per year due to proposed CTF investments
To address the country’s growing energy needs while mitigating the effects of climate change, the government of Vietnam has developed an investment plan in coordination with the Asian Development Bank (ADB), members of the World Bank Group (IBRD, IFC), and key Vietnamese stakeholders to tap US$250 million from the Clean Technology Fund (CTF) for targeted low carbon investments in the power, transport, and industrial sectors. Vietnam’s CTF investment plan will support energy efficiency investments in industrial and energy service companies; the initial capitalization for energy conservation and renewable energy funds; direct investment into a private sector renewable energy risk-sharing facility; and enhancements to urban transport systems in Hanoi and Ho Chi Minh City. CTF financing is expected to mobilize an additional US$3.64 billion in public and private sector support to achieve 97.5 MtCO2e GHG emissions savings and reductions, accelerating Vietnam’s progress toward its low carbon energy and development objectives.