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USAID VIETNAM LOW EMISSION ENERGY PROGRAM (V-LEEP)

Quarterly Report FY16 Q2 (January – March 2016)

April 15, 2016

This report is made possible by the support of the American people through the United States Agency for International Development (USAID). The contents are the sole responsibility of the Vietnam Low Emission Energy Program and do not necessarily reflect the views of USAID or the United States Government.

USAID VIETNAM LOW EMISSION ENERGY PROGRAM (V-LEEP)

Quarterly Report FY16 Q2

Prepared for:

USAID/Vietnam, Environment and Social Development Office

Prepared by:

Contract No. AID-440-TO-15-00003

April 15, 2016

The author’s views expressed in this publication do not necessarily reflect the views of the United States Agency for International Development or the United States Government.

TABLE OF CONTENTS Acronyms .............................................................................................................................. i Executive Summary ............................................................................................................. 1

Tóm Tắt Báo Cáo ................................................................................................................. 2

V-LEEP Overview ................................................................................................................. 3

Progress and Achievements ................................................................................................ 4

Progress by Performance Indicators ................................................................................... 7

Considerations and Challenges........................................................................................... 7

FY16 Q3 Project Forecast .................................................................................................... 8

Cooperation with Other USG and Donor Programs ............................................................. 9

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ACRONYMS

COP Chief of Party DCOP Deputy Chief of Party EE Energy Efficiency FY Fiscal Year GDAA Gender and Development Action Agenda GDE General Directorate of Energy GIZ Gesellschaft für Internationale Zusammenarbeit GVN Government of Vietnam IEE Industrial Energy Efficiency IIE Institute of International Education MOC Ministry of Construction MOIT Ministry of Industry and Trade PCD Partner Capacity Development Program PD Project Document PMR Partnership for Market Readiness PO Project Outline RCEE Research Center for Energy and Environment RE Renewable Energy TTC Technology Transition Corporation U.S. United States USAID United States Agency for International Development VCEP USAID Vietnam Clean Energy Program

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EXECUTIVE SUMMARY During the second quarter of FY16, Deloitte has expanded the V-LEEP project’s technical work, completed mobilization, brought on new staff, and initiated work with the Ministry of Industry and Trade’s General Directorate of Energy (MOIT/GDE) on the Project Document (PD). In addition work progressed under each of the three project components, as well as on cross-cutting activities.

V-LEEP made steady progress towards obtaining GVN Activity Approval during this past quarter. Meetings were held with representatives from MOIT/GDE to review the Project Outline and respond to MOIT/GDE’s feedback. An accelerated project was developed for completion in April, under which V-LEEP team members would meet with representatives from GDE’s various departments and solicit feedback on the PD, consolidate that feedback, and then revise the PD accordingly. A workshop is currently scheduled for April to review the information gathered from this process and present a final work plan for incorporation into the PD. GVN Activity Approval is currently anticipated for June/July.

V-LEEP made progress under each of the project’s three technical components during the past quarter. During January, V-LEEP presented the geographic priority areas criteria and selection results. Energy policy and modeling mapping continues under Component 1 and V-LEEP plans to present results to USAID in Q3. Under Component 2, the characterization of renewable energy (RE) developers was initiated. Industry characterization work under Component 3 continues, as does the overview of existing industrial energy efficiency (IEE) data collection and reporting systems. V-LEEP plans to present the results of this work to USAID during the first half of Q3.

Throughout Q2, preparations for the June U.S. Study Tour continued and V-LEEP staff held a kick-off meeting and subsequent planning meetings with the collaborating organization, Institute of International Education (IIE). A final list of participant nominations is anticipated to be in hand at the start of Q3, after which the team will begin making logistics accommodations per the developed site visit schedule for California, Minnesota, and Washington, DC. In addition to progress made towards the implementation of the U.S. Study Tour, V-LEEP furthered other cross-cutting activities including the finalization of the Gender and Development Action Agenda (GDAA) in January.

The approved Year 1 Work Plan activities for Components 1 and 3 are on track, but Deloitte anticipates that some minor adjustments in scheduling will be necessary due to the pending GVN Activity Approval. Some deliverables under Component 2 will also be delayed, but are anticipated to be completed this during this work plan year.

For the upcoming quarter, the V-LEEP team plans to continue work on the Year 1 Work Plan deliverables across all components, finalize the MOIT/GDE PD, and implement the U.S. Study Tour.

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TÓM TẮT BÁO CÁO Trong quý 2 năm tài khoá 2016, Deloitte đã tăng cường hoạt động kỹ thuật của dự án V-LEEP, hoàn thành việc tuyển dụng nhân sự mới và bắt đầu hoạt động hợp tác với Tổng cục Năng lượng, Bộ Công Thương (BCT/TCNL) về Văn kiện dự án. Bên cạnh đó, chúng tôi cũng đã triển khai các hoạt động thuộc ba hợp phần dự án và các hoạt động phối kết hợp.

V-LEEP đạt được tiến triển nhất định trong việc xin Phê duyệt hoạt động của Chính phủ Việt Nam trong quý này. Dự án có một số cuộc họp với đại diện của BCT/TCNL nhằm rà soát Đề cương dự án và xin ý kiến phản hồi của BCT/TCNL. Dự kiến tháng 4 cán bộ dự án V-LEEP sẽ họp với đại diện các phòng ban của TCNL, tổng hợp ý kiến về Văn kiện dự án và điều chỉnh Văn kiện dự án theo các ý kiến nói trên. Chúng tôi sẽ tổ chức hội thảo vào tháng 4 để thảo luận về thông tin thu thập từ các cuộc họp trên và trình bày bản kế hoạch công việc hoàn tất được lồng ghép vào Văn kiện dự án. Chúng tôi hy vọng sẽ có được Phê duyệt hoạt động của Chính phủ Việt Nam trong tháng 6/tháng 7.

Ba hợp phần của dự án V-LEEP đạt được một số kết quả trong quý vừa qua. Tháng 1, V-LEEP đệ trình các tiêu chí khu vực ưu tiên về mặt địa lý và kết quả lựa chọn. Chính sách năng lượng và lập sơ đồ mô hình tiếp tục được thực hiện trong Hợp phần 1 và V-LEEP dự kiến trình bày kết quả cho USAID vào quý 3. Trong Hợp phần 2, chúng tôi đã xây dựng đặc trưng cho đơn vị phát triển năng lượng tái tạo. Hoạt động xác định đặc trưng ngành thuộc Hợp phần 3 cũng được tiếp tục cùng với việc rà soát tổng quan hệ thống thu thập dữ liệu và lập báo cáo về sử dụng năng lượng hiệu quả ngành hiện có. V-LEEP dự kiến sẽ trình bày kết quả của hoạt động này tới USAID khoảng nửa đầu quý 3.

Trong quý 2, dự án tiếp tục chuẩn bị cho Chuyến thăm quan học tập tại Mỹ vào tháng 6. Cán bộ của V-LEEP đã tổ chức cuộc họp khởi động và các cuộc họp lập kế hoạch với các tổ chức liên quan, Viện Giáo dục Quốc tế (IIE). Danh sách hoàn tất về thành viên tham gia chuyến thăm quan sẽ được công bố vào đầu quý 3, sau đó, nhóm phụ trách công tác chuẩn bị sẽ bắt tay vào hoạt động chuẩn bị hậu cần theo lịch trình chuyến thăm tại các bang California, Minnesota, và Washington, DC. Ngoài kết quả đạt được trong việc chuẩn bị chuyến Thăm quan học tập tại Mỹ, dự án V-LEEP cũng thực hiện các hoạt động phối kết hợp khác, trong đó có việc hoàn thành Chương trình hành động về Giới và Phát triển (GDAA) vào tháng 1.

Các hoạt động của Bản Kế hoạch công việc năm 1 đã được phê duyệt cho Hợp phần 1 và 3 đang theo đúng hướng, nhưng Deloitte dự đoán cần có một số điều chỉnh nhỏ do quá trình Phê duyệt hoạt động của Chính phủ Việt Nam đang tạm treo. Dự kiến một số sản phẩm của Hợp phần 2 cũng bị chậm nhưng sẽ hoàn thành trong kế hoạch năm nay.

Trong quý tiếp theo, nhóm dự án V-LEEP có kế hoạch tiếp tục triển khai các nhiệm vụ theo các sản phẩm trong Kế hoạch công việc năm 1 của tất cả các hợp phần, hoàn thành Văn kiện dự án BCT/TCNL, và thực hiện Chuyến thăm quan học tập tại Mỹ.

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V-LEEP OVERVIEW The USAID Vietnam Low Emission Energy Program (V-LEEP) is designed to assist the Government of Vietnam (GVN) in establishing an effective policy, regulatory, and incentive environment for low-emission growth in the energy sector, while simultaneously attracting public- and private-sector investment in renewable energy (RE) development and energy efficiency (EE). V-LEEP will promote the development of critical building blocks to scale up clean energy, such as accessible smart incentives for clean energy and EE investments, enabling a competitive environment for RE generation, enhancing renewable power grid integration, and ensuring locational concentration of clean energy generation facilities.

Three components form the core tasks under the approved V-LEEP Year 1 Work Plan:

Component 1: Low Emission Strategy Development for the Energy Sector

Task 1.1: Enhance GVN capacity to analyze and develop clean energy strategies, and evaluate emission mitigation options for decision making.

Component 2: Enhance Capacity and Improve Enabling Environment for Renewable Energy Development

Task 2.1: Enhance capacity of Vietnamese government institutions to improve the enabling environment for RE development.

Task 2.2: Enhance capacity of RE developers and the private sector in large-scale RE development.

Task 2.3: Increase adoption of RE in industry.

Component 3: Increase Energy Efficiency Adoption and Compliance

Task 3.1: Enhance government capacity to strengthen energy efficiency policy implementation.

Task 3.2: Enhance energy efficiency in energy-intensive industry sectors.

Cross-cutting activities:

Geographic Priority Area Selection

U.S. Study Tour

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PROGRESS AND ACHIEVEMENTS V-LEEP has had a productive second quarter. The following sections describe progress and achievements under each element of the project.

Component 1: Low Emission Strategy Development for the Energy Sector Under Component 1, V-LEEP continued work on a review and mapping of ongoing and planned initiatives in Vietnam that relate to RE and EE. The analysis has considered initiatives such as, but not limited to: Vietnam’s Green Growth Strategy (VGGS), the World Bank’s Partnership for Market Readiness (PMR) initiative, the World Bank’s Energy Efficiency for Industrial Enterprises (VEEIE) project, and GIZ’s 4E project.

Summary of work-in-progress:

Activity Work Plan Deliverable Status

Policy/Models Mapping Modeling Characterization Report

Draft institutional mapping is complete; modeling characterization will begin in FY16 Q3.

Component 2: Enhance Capacity and Improve Enabling Environment for Renewable Energy Development V-LEEP completed a draft geographic selection criteria and selection report and presented the methodology and conclusions to USAID. V-LEEP also initiated the development of an RE developer characterization assessment which will include an evaluation of the highest potential RE technologies and sectors for V-LEEP to target, a review of the landscape for developers, and a characterization of developers using specific criteria.

Summary of work-in-progress:

Activity Work Plan Deliverable Status

Geographic Selection None Presented to USAID, comments incorporated, and final report completed.

RE Developer Characterization

RE Developer Characterization Report Work initiated during FY16 Q2.

Alternate Procurement Mechanisms

Alternate Policies and Procurements White Paper

Developing a concept paper for reverse wind power auctions and background material for the white paper.

Industrial Park RE Development

Attended ICF workshop and met with proponents to test the concept.

Component 3: Increase Energy Efficiency Adoption and Compliance V-LEEP continued to lay the groundwork for project activity in IEE within selected industries throughout Vietnam, as well as with ESCO service providers. Activity included work on an overview of IEE data collection and reporting systems and an industry characterization report.

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Summary of work-in-progress:

Activity Work Plan Deliverable Status

IEE Data Collection and Reporting

Adoption and compliance roadmap Draft report in progress

Industry Characterization Adoption and compliance Report Draft report in progress

This work will become the basis for coordinating with MOIT/GDE and performing the work under Tasks 3.1 (Compliance Reporting) and 3.2 (IEE).

Cross-cutting Activities V-LEEP made progress on a number of cross-cutting items during FY16 Q2. The program finalized and submitted the Gender and Development Action Agenda (GDAA) in January, and will begin implementation of these activities as they arise on the project, while continuing to integrate gender considerations throughout all of the project’s activities. V-LEEP is actively coordinating with other stakeholders and donors to ensure a consistent approach and harmonization with other programs, where possible.

Work continued on two critical project management tasks during FY16 Q2:

Project Outline (PO) and Project Document (PD) – The V-LEEP team and USAID received feedback from MOIT on the V-LEEP PO, which was submitted during FY16 Q1. V-LEEP incorporated this feedback into a more detailed work plan and project plan, and is revising the PO to better meet MOIT/GDE’s needs. V-LEEP staff held one-on-one planning meetings MOIT/GDE departments, to which V-LEEP received a positive response.

U.S. Study Tour – V-LEEP continued planning meetings with IIE, which implements USAID’s Partner Capacity Development Program (PCD) and is assisting with logistics on the V-LEEP U.S. Study Tour. V-LEEP has made good progress on the development of the tour’s itinerary with over half of the proposed hosts in California, Minnesota, and Washington, DC having confirmed participation.

Project Management Subcontracting and Key Personnel

V-LEEP extended an offer which was subsequently accepted by the Component 3 Lead candidate. He is expected to deploy to Hanoi in FY16 Q4. The V-LEEP team continued with recruiting efforts for the Component 2 Lead position. A small subcontract with small business Technology Transition Corporation (TTC) was initiated during Q2 for support on the planning of the U.S. Study Tour. The subcontract with Nexant is on hold pending GVN Activity Approval and the development of the Year 2 Work Plan. Finally, V-LEEP completed arrangements with an independent consultant to support the wind power program.

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Reports & Deliverables

V-LEEP submitted three contract deliverables during Q2: the FY16 Q1 Quarterly Report, the FY16 Q1 Financial Report, and the FY16 Q2 Accruals Report. In addition, V-LEEP submitted a final Gender and Development Action Agenda (as stated above) and presented a number of internal work products to USAID including the U.S. Study Tour concept note, a draft itinerary for the U.S. Study Tour, draft Project Outlines/Documents and various technical reports that are detailed in the above Component sections.

Other Project Management

V-LEEP held several cross-cutting meetings and attended numerous relevant events, including:

Celebration of Women in Technology in the Lower Mekong River Countries Workshop (11 – 12 January)

Engagement Director Visit and Meeting with USAID (26 – 29 January)

USAID Partners Meeting (2 February)

Meeting with USAID/Vietnam Team in Washington, DC (29 February)

GIZ Energy Program Coordination Meeting (4 March)

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FY16 Q3 PROJECT FORECAST The following activities are planned under each element of the V-LEEP project for FY16 Q3 (April – June 2016).

Component 1: Low Emission Strategy Development for the Energy Sector During FY16 Q3, V-LEEP will continue work on energy policy mapping (as part of the modeling characterization report). V-LEEP will issue a draft report in late April and subsequently schedule a presentation on the report’s findings for USAID. V-LEEP will defer other Component 1 Year 1 tasks, such as the complete characterization report and stakeholder workshop, until V-LEEP obtains the GVN Activity Approval and can engage with counterparts and stakeholders.

Component 2: Enhance Capacity and Improve Enabling Environment for Renewable Energy Development Work will be initiated on the RE Developer Characterization Report, RE Adoption Report, and Biomass Project Analysis during Q3. V-LEEP also will continue to work on wind power reverse auctions during the upcoming quarter. Many of the Year 1 Work Plan deliverables under Component 2 depend on V-LEEP’s ability to interact and work with GVN stakeholders. For this reason, V-LEEP anticipates some of these tasks will need to be rescheduled or deferred pending GVN Activity Approval.

Component 3: Increase Energy Efficiency Adoption and Compliance V-LEEP will continue to work on the energy efficiency data collection and reporting compliance overview, and on characterizing IEE efforts, but without active involvement from GVN counterparts and stakeholders. The findings will therefore be limited to available information. V-LEEP anticipates that all Year 1 Work Plan deliverables under Component 3 will be completed on time, pending timely GVN Activity Approval.

Cross-cutting Activities V-LEEP will continue to work on the organization of the U.S. Study Tour. The project is currently developing an overview of the Vietnamese energy sector to provide to tour hosts in the U.S. The tour will take place at the end of Q3.

The following cross-cutting tasks will continue in Q3:

Project Outline (PO) and Project Document (PD) – V-LEEP has initiated and will complete the accelerated project plan developed for achieving consensus with MOIT/GDE on the PO and PD, and has scheduled a review workshop for April 13. V-LEEP seeks to obtain GVN Activity Approval by the beginning of FY16 Q4.

Cooperation with Other USG and Donor Programs

o V-LEEP will meet with GIZ and other stakeholders as appropriate

o V-LEEP staff plan to attend donor/GVN workshops on RE and IEE issues

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Project Management V-LEEP will continue to recruit for an exemplary Component 2 lead and technical staff. V-LEEP anticipates the Component 3 lead will deploy during the first half of FY16 Q4. Deloitte will continue to provide project management reports as required under the task order contract and Year 1 Work Plan. Finally, V-LEEP will continue to participate in donor coordination meetings and to support ad hoc request from USAID and partners.

COOPERATION WITH OTHER USG AND DONOR PROGRAMS While V-LEEP is USAID’s primary energy sector program in Vietnam, two other ongoing USAID programs complement it:

USAID Vietnam Clean Energy Program (VCEP) In an effort to reduce long-term trajectory of energy emissions in building sector, the USAID Vietnam Clean Energy Project is designed with the purpose to support the Ministry of Construction (MOC) to implement National Green Growth Strategy with low emissions and promote energy efficiency in all types of civil buildings. Activities include:

Activity Area 1: Activities that support MOC in building up a database on building energy efficiency performance.

Activity Area 2: Activities that support MOC in developing energy efficiency benchmark for types of typical buildings in different climate zones based on collected and analyzed database.

Activity Area 3: Activities that support MOC in the implementation of the task on "Establishment and Implementation of Green Growth Action Plan in Building sector" under the framework of the National Green Growth Strategy.

Activity Area 4: Activities that support MOC to train and enhance capacity building of targeted groups.

Vietnam Central Province Green Growth Growth Action Plan The central province of Thanh Hoa and USAID will enhance the exchange of information, knowledge and technology in the field of climate change, while jointly conducting surveys and collecting data on agriculture, forestry and aquaculture; energy; industry and waste treatment. They will also work together to draft an action plan for Thanh Hoa’s green growth strategy. USAID will support the Vietnamese locality in improving institutional capacity and training human resources to be able to implement strategy successfully.

V-LEEP maintains active contact and coordination with these other two programs to ensure consistency of approach and objectives.