“Energy audit is necessary for businesses, as it helps enterprises use energy efficiently and save on costs,” observed Mr. John Nielsen, Danish Ambassador to Vietnam. The envoy remarked to the Daily on the sidelines of a ceremony to launch the energy efficiency campaign in Hanoi on Tuesday that “Vietnamese enterprises are not aware of energy audit.” Following are excerpts.
The Saigon Times Daily: Can you tell us about Denmark’s cooperation with Vietnam in the field of energy efficiency?
Ambassador John Nielsen: Denmark has begun development cooperation with Vietnam since 1993. We have supported environment protection among others. For more than 10 years, we could see that some of the issues related to climate change could not be covered within the environment program, so we expanded cooperation to climate change area. The Danish government had a strong focus on supporting climate change activities in different parts of the world.
In early November, on the first visit of the Danish Prime Minister to Vietnam, Denmark and Vietnam signed an agreement worth US$14 million to help Vietnamese small- and medium-sized enterprises using energy efficiently.
Can you evaluate the potential for improvements in energy efficiency in Vietnam?
- Vietnam indeed needs to invest in energy efficiency to meet the growing power demands and to ensure sustainable economic growth. Estimates indicate potential energy reduction of up to 50% in the cement industry, 35% in the ceramic industry, 30% in the textile/apparel industry and 20% in the steel and food processing industries. Within the next five years, the Vietnamese Government targets to lower the overall industrial energy consumption by 5-8% through technological upgrading.
In your opinion, what should Vietnamese enterprises do to be able to use energy efficiently?
- They need to focus on energy audit to identify areas where rational use of energy has not been achieved or has been wasted. After that, they should propose energy-efficient solutions. Energy audit is necessary activity to help enterprises save on costs. But as I see in Vietnam, the awareness of enterprises on this issue is not high. I think we have to help enterprises realize that energy audit will bring significant material benefits to them, and then they will do it.
Is there any specific way to increase awareness among the enterprises, such as a specific survey to prove that energy costs on each product in Vietnam is higher than in other countries, making production costs higher?
- I have not seen any surveys done that way. The way we do now is that we send an expert team to the companies to see the entire process and notice how they use energy. Then the expert team will make recommendations about how the company can save on energy and they will also propose specific solutions. It depends on the company to apply the suggestions or not. But I firmly believe that companies can easily save some money if they implement energy saving measures.
With the experience of Denmark, to achieve energy efficiency, which is more important, awareness or technology solution?
- I think we need both. If you look at Denmark in the period from 1980 to 2010, our GDP has increased by 78%, but the rate of energy use does not increase. It is because the Danish government required businesses to increase awareness and implement solutions to reduce energy consumption. Of course in Vietnam you still need the help of technology. But you should need to raise awareness of energy saving, starting from the generation of students in the school. If not, it could be too late.
A ceremony was launched on Tuesday to start the energy efficiency campaign. The campaign, led by the Ministry of Industry and Trade with the support of the International Finance Corporation (IFC) and the Danish International Development Assistance (DANIDA), will focus on raising awareness and promoting action among the business community, encouraging them to comply with the provisions of the Law on Energy Efficiency and Conservation.
In the first phase of 2012-2013, the campaign’s target consists of businesses in four key industrial groups, namely cement, steel, chemicals, and pulp and paper. The next phase to 2015 will target the entire manufacturing enterprises in Vietnam.
For more than two decades, Vietnam’s energy sector has grown robustly, basically meeting the needs of socio-economic development. However, the size and efficiency of the energy sector is still low while energy security is not guaranteed. Energy demand growth rate almost doubles GDP growth, while in developed countries, the two rates are approximately equal.
Efficient use of energy helps domestic enterprises eliminate the risk of energy loss in the production process. It also remains the fastest way to reduce costs, increase productivity and profitability for the business. In addition, efficient use of energy also contributes to national energy security, reducing greenhouse gas emissions, thereby creating reputation for the business as being responsible to the environment and society.
Business & Investment Opportunities
Saigon Business Corporation Pte Ltd (SBC) is incorporated in Singapore since 1994. As Your Business Companion, we propose a range of services in Strategy, Investment and Management, focusing Health care and Life Science with expertise in ASEAN 's area. We are currently changing the platform of www.yourvietnamexpert.com, if any request, please, contact directly Dr Christian SIODMAK, business strategist, owner and CEO of SBC at firstname.lastname@example.org. Many thanks.