THE World Bank and Vietnam’s Ministry of Industry and Trade today jointly launched a $102 million project to support the efforts of industrial enterprises to adopt energy-efficiency technologies and practices.

Under this project, industrial enterprises can access a new line of credit to fund their purchases of energy-efficiency and production-optimisation technologies, thus reducing energy consumption and production costs and increasing their overall competitiveness in the domestic and international markets.

With the support of the project, financial institutions and industrial enterprises will be able to prepare, evaluate and appraise energy efficiency projects. This will create a new line of business for financing institutions, providing loans to support industrial energy-efficiency investments, which will enable them to scale up energy-efficiency lending to industries.

“The Government has made strong efforts over the last few years in developing policies and regulations aiming to promote energy efficiency in all sectors,” said Ousmane Dione, the World Bank’s Country Director for Vietnam. “Vietnam’s energy sector is facing many challenges due to limited domestic energy resources and the high electricity demand to support economic growth.  In this context, implementing and scaling up energy efficiency investments will bring multiple benefits, such as improving the competitiveness of Vietnam’s industrial sector, reducing GHG emissions and avoiding the need for investments in new coal-fired power generation.”

Funding under this project will be provided to participating financial institutions, which will then lend to industrial enterprises to invest in energy-efficient sub-projects.

Of the $158 million, $100 million comes from the World Bank’s International Bank for Reconstruction and Development, the financing resource for middle-income countries, and $1.7 million is from the International Development Association, the Bank’s fund for the poorest countries. The rest of the project’s funding will come from the Vietnam government participating financial institutions, and industrial enterprises.

Source: The World Bank. Picture Ho Chi Mihn City by Hieucd – Own work, CC BY-SA 4.0.