Energy efficiency law in effect

Deputy chairman of the National Assembly’s Science, Technology and Environment Committee Nghiem Vu Khai explains in a recent talk with Vietnam Investment Review how the Law on Energy Efficiency and Conservation, effective from January 2011, will help reduce the tension surrounding power shortages, if imposed properly.

Vietnam has the potential to save around 20-30 per cent of local power consumption. Is that correct?

That is right. Problems are seen with the current ineffective public lighting systems and the state of technology and equipment at many enterprises.

A large segment of the population still does not use energy efficiently. These factors have all have exaggerated the overall situation.

Besides, one of the core reasons is the massive production levels of cement and steel in the country.

The Vietnamese government had to enact regulations stipulating that unplanned cement and steel firms need to source power on their own or buy it at a suitable tariff. It is unreasonable when a big cement or steel plant uses half the power amount allocated for a whole province, causing continual power failures.

Equipment and technology innovations take time while critical power shortages are threatening current economic growth. What can be done?

The state should introduce financial policies soon to promote energy efficiency and conservation among people and businesses. For example, extending enterprise income tax payment deadline from three to six months or allowing businesses to extend machinery depreciation period, if they personally buy power generators to ensure their energy needs.

As for people, although the price of electricity is gradually adjusted based on market rules, the process occurs at a snail’s pace, so that many people still keep the habit of using power in a careless manner. It is now important to quicken the process of adjusting the price of power based on market rules, irrespective of who the end-users are.

What should be done to address power scarcity when thermo-power production faces stagnation, hydropower sources are in danger of soon running out and atomic energy will become available only after 2020?

In the long term, financial support and other incentive policies are important to promote energy efficiency and conservation, and diversify investments to push up scientific research, application and development of advanced energy efficient technologies.

In addition, Vietnam has great potential to develop clean and renewable energy sources such as wind and solar energy, and waste recycling. Using renewable energy may be a bit costly at first, but the price will gradually go down when it becomes more popular.

I believe the business community and local people will eagerly use renewable energy if the state presents suitable incentives. – VIR

Tags: Energy efficiency