Page 1 58105 POTENTIAL CLIMATE CHANGE MITIGATION OPPORTUNITIES IN INDUSTRY SECTOR IN VIETNAM Background Paper Prepared by: RCEE Energy and Environment JSC (Vietnam), and Full Advantage Co., Ltd. (Thailand) Submitted to the World Bank Carbon Finance Assist Program – Vietnam November 2010 Page 2 TABLE OF CONTENT Abbreviations and Acronyms ..............................................................................................3 1 Brief description of the industry sector........................................................................4 1.1 Cement industry................................................................................................ 4 1.2 Brick making..................................................................................................... 8 1.3 Iron and steel industry....................................................................................... 9 1.4 Pulp and paper industry .................................................................................. 12 2 Climate Change Mitigation Opportunities in the Industry Sector.............................16 2.1 Overview of the potential ............................................................................... 16 2.2 Typologies of potential CCM projects in the sector....................................... 17 2.2.1 Cement industry.................................................................................... 17 2.2.2 Brick making......................................................................................... 22 2.2.3 Iron and steel industry........................................................................... 23 2.2.4 Pulp and paper production.................................................................... 25 Annex 1: References.........................................................................................................28 Page 3 Abbreviations and Acronyms BFG Blast furnace gas BOF Basic oxygen furnace CCM Climate Change Mitigation CDM Clean Development Mechanism CDQ Coke dry quenching CER Certified Emission Reduction CH4 Methane CHP Heat and Power Cogeneration CO2 Carbon dioxide GHG Greenhouse Gas GSO General Statistics Office MOIT Ministry of Industry and Trade MONRE Ministry of Natural Resource and Environment tCO 2 -e ton CO 2 equivalent TOE tons oil equivalent N2O Nitrous oxide TMP Thermo-Mechanical Pulping KTOE Thousand Tons Oil Equivalent TPM Total Productive Manufacturing VABM Vietnam Association of Building Materials VICEM Vietnam Cement Industry Corporation VSBK Vertical Shaft Brick Kiln VSC Vietnam Steel Corporation WB World Bank WHPG Waste Heat Power Generation Page 4 Brief description of the industry sector One of the major engines for economic growth in Vietnam over the past 15 years has been industry. Since 1990 the industrial sector has grown an average of 10 percent per year and over that time its share of GDP has grown from 25 to 41 percent. The growth of this sector is led by the “non-state” industries, which have been growing as much as 20 percent annually and foreign invested companies which are growing at 15.3 percent per year. State owned industries are also growing but less significantly. In addition to the rapid growth rate, it is the largest energy consuming sector, making up 36 percent of the total energy use in 2000. Coal accounts for 57 percent of the energy consumption while electricity accounts for 21 percent. Forecasts indicate the growth rate in energy consumption from industry will be on average 7.1 percent per year (2001 – 2025) and coal is expected to maintain itself as the main fuel source over time with a projected share of 46 percent in 2020. Table 1 - Energy consumption in the industry sector (2000 – 2025 period) 2000 2010 2015 2020 2025 Energy consumption (MTOE) 4.36 15.77 21.68 29.1 36.7 Share (%) 36% 33% 33% 35% 38% Source: MOIT, 2007 With the large energy demand and high reliance on fossil fuels, the industrial sector is one of the most significant greenhouse gas emitting sectors. The most energy consuming industry sub-sectors are construction materials including cement and brick (44 percent of industrial energy use), iron and steel (22 percent) and pulp and paper (8 percent), which together emit over 31 million tCO2-e per year which is 21 percent of the GHG emissions in Vietnam in 2005. This report will focus on the potential GHG reduction in these four industry sub-sectors. Table 2 - Estimated volume of GHG emissions by industry sub-sector in 2004/2005 Industry Production Estimated volume of GHG (thousand tCO 2 -e) Cement 22,000,000 tons 19,890 Iron and steel 657,000 tons steel billet 1,033,000 tons rolled steel 6,093 Brick 16,000 (million bricks) 4,080 Paper 805,000 tons 1,634 (RCEE, 2005) Calculated based on the energy demand forecast data from Institute of Energy and emission factor from IPCC 1999 Cement industry Page 5 The Vietnam cement industry produced an estimated 22,000,000 tons of cement in 2005 and production is growing at an average rate of between 10 percent and 14 percent per year. Demand forecasts indicate this growth rate is expected to continue between 2006 and 2010 and to decrease thereafter, to an estimated 7 percent in 2015 and 3 percent in 2020. Statistical data from the Technical Department of Vietnam Cement Industry Corporation, 2008; Diagram adapted from Ernst and Young, 2003. Vietnam National Cement Corporation (VNCC) which is a state general corporation is the major player in the country, with nine member enterprises that produce cement, accounting for 44 percent of production in Vietnam in 2008. The remainder of the cement production is supplied by joint venture companies (21 percent) and small cement plants (35 percent). Table 3 - Cement demand projection up to 2020 in Vietnam Items 2004 2005 2006 2007 2008 2009 2010 2015 2020 Growth rate, % 14 13 12 12 10 10 10 5-8 2,5-3 Demand (mil. tons) 25,7 29,1 32,6 36,5 40,1 44,2 48,6 63-65 68-70 Production (mil. tons) 18,8 22,0 27,95 35,3 42,0 47,6 49,8 62,8 68 (MONRE, 2005) According to the Vietnam Cement Development Plan up to 2010 and prospective to 2020 Technologies: The basic process of cement production consists of 3 steps 1 . Raw material preparation: Limestone – the main raw material - is extracted from the quarry then blended with other raw materials (clay/shale/sand) and crushed. Depending on the technology used, crushed raw material can be either grinded dry into a fine powder 1 Adapted from Ernst and Young, 2003b Vietnam Cement Corporation (VNCC) Joint Ventures H olcim C hin Fon N ghi Son 44 % Volume Small factories ( 55 ) 1 2 55 21 % Volume 35 % Volume Current industry players (2008) Cement demand: 34 Million tons H oang Thach B im Son B ut Son O ld Hai Phong H a Tien 1 H a Tien 2 H ai Van 7.1 Million tons 15.1 Million tons 12 Million tons E mergence of new players L uk Vasi Hoang Mai Construction Ministry (MoC) Page 6 (raw meal) in the raw material mill (with Dry Process technology), or be grinded with water to form a slurry (with Wet Process technology). This process uses both electricity and fuel for heat. Clinker making: The raw materials are then fired in a kiln to form clinker. Raw meal is pretreated by heating to approximately 900 degrees Celsius before being fed into a kiln. Slurry is processed differently. It is pumped in the upper end of the kiln without preheating. Inside the kiln, the cement clinker is produced by a chemical reaction at a temperature of 1450 degrees Celsius. This process relies on large quantities of fuel for heat. Cement making: Clinker from the kiln is cooled in the clinker cooler, then grinded into powder in cement mill. During the milling, clinker is mixed with additives to form cement. This process relies on electricity. Raw Material Preparation Clinker Making Cement Making Electricity / Heat Heat Electricity Figure 1 - Flow chart of energy use in cement production Kiln technologies in Vietnam: While many plants are converting to more modern kiln technology, older less efficient kilns are widely in use. In particular, many plants employ wet kiln technology that relies on wet or semi wet raw materials and therefore require more energy for evaporation; and vertical shaft kilns which is an outdated technology that produces lower quality cement and is difficult to operate in an energy efficient manner. Over the past 10 years plants have been converting to a variety of modern kiln technologies that improve energy use efficiency relative to these older technologies. These include rotary kilns and semi wet, semi dry, dry or combined wet-dry processes; and also pre-heater and pre-calciner technology. Table 4 - Number of cement plants and clinker production capacity by type in Vietnam No. Technology No. of plants Total production capacity (million tons/year) 1 Rotary kiln 19 24.2 2 Vertical kiln 47 2.7 3 From vertical to rotary (under 8 3.1 Page 7 process) 4 From vertical to rotary (proposed) 9 4.1 (RCEE, 2007) Statistical data from Vietnam Cement Industry Corporation Cement blending in Vietnam: The cement industry in Vietnam produces predominantly PCB30 quality cement and also the higher quality PCB40. PCB30 quality allows up to 40 percent blending with additives according to standards from the Vietnam Association of Building Materials (VABM). At present, the ratio of additives in cement product is only 18-20 percent and therefore the clinker content and associated energy requirements in its production is higher than may be necessary. Energy consumption : The cement industry uses both fuel and electricity. The largest energy consuming processes are raw material treatment and clinker production which account for 80 percent of the energy consumption and clinker grinding which accounts for around 20 percent of energy consumption 2 Table 5 Comparison of energy efficiency in two plants with different kiln technologies in Vietnam Cement plant and technology Energy use World comparison (# of samples) Bim Son cement plant Wet kiln technology 144 kwh/ton 7704 KJ/ton 104 kwh/ton (86 cement factories) 3669 KJ/ton (150 kilns) 6313 KJ/ton (30 wet kilns of similar capacity) Huang Thach cement plants Pre-calciner technology 98.8 kwh/ton 3967-4010 KJ/ton 104 (86 cement factories) 3669 KJ/ton (150 kilns of all technologies) 3460 KJ/ton (44 pre-calciner kilns) Ernst and Young, 2003 . Average energy consumption estimates for this sector as follows 3 : · Heat consumption: 950 kcal/kg of clinker (3.98 GJ/ton of clinker) · Electricity consumption: 100 kWh/ton of cement · Electricity consumption for clinker grinding: 40 kWh/ ton of clinker Table 6 - Energy consumption forecast for cement production (kTOE) 2010 2015 2020 Electricity 407 513 555.6 Fuel 3,276 4,132 4,473.8 Total 3,683 4,645 5,029.4 Source: MONRE, 2004 2 (MONRE, 2004). 3 Data source: Assessment of the demand for GHG reduction technology in industry sector in Vietnam, 2005, MONRE Page 8 Greenhouse gas emissions : The cement industry emits an estimated 19.9 million tCO2-e per year from a combination of energy consumption (fuel and electricity) and emissions of carbon dioxide from the chemical reactions in the cement processes. Emissions are projected to grow 25 percent per year. Table 7 - GHG emission in the cement industry (thousand tCO 2 -e), 2002 – 2020 2002 2005 2010 2015 2020 Emission from fuel 4,640 7,750 13,490 17,010 18,420 Emission from electricity 1,480 2,100 4,050 5,100 5,520 Emission from processing 7,300 10,040 22,730 28,660 31,030 Total emission 13,420 19,890 40.270 50,770 54,970 (RCEE, 2005) Calculated based on the energy demand forecast data from Institute of Energy and emission factor from IPCC 1999 In addition to the rapid growth of the industry, the major reasons for the high emissions are: · Reliance on coal for raw material treatment and clinker production; · Reliance on fossil fuel based electricity grid for the clinker grinding; · Continued use of vertical kilns and wet kilns in many plants. · Blending of cement is well below industrial standards and therefore clinker content and production is higher than necessary. · Low energy efficiency of many facilities. Brick making As with the cement industry, rapid growth of the construction sector, the production of bricks, increased dramatically over the last 10 years with the volume of baked brick produced expected to reach 25 billion pieces in 2010 and 42 billion pieces in 2020 4 . The brick industry is dominated by small scale manufacturers including over 10,000 traditional brick kilns that utilize coal or firewood. Table 8 - Baked brick production and consumption/demand in Vietnam (million pieces) 2000 2001 2002 2003 2004 2005 Production 9,087 8,981 11,365 12,810 14,501 16,000 Consumption/ Demand 8,500 9,500 11,300 12,800 14,300 15,700 Source: GSO,2007 and survey data from the Market and Price Scientific Research Institute Technologies: Brick making involves the following steps: Mixing: clay is mixed with water by hand or by auto-machine; Forming: Bricks are formed using a brick machine; Drying : The bricks are then dried to make them hard and durable using sunlight or by heat in drying room; Firing: The bricks are then fired in kilns. 4 VABM, 2007 Page 9 Kiln technologies in Vietnam: The majority of the energy used is in the firing of the bricks in kilns. In Vietnam 65 percent of the total of bricks and tiles are produced in traditional kilns. These technologies are batch processes largely dependent on coal and firewood. Approximately 30 percent of the bricks are produced in tunnel or blast furnaces which are more efficient than the traditional kilns but like the traditional kilns use coal as the major source of energy. In recent years, the vertical shaft brick kiln (VSBK) was disseminated through donor and government support. These kilns while still dependent on coal, use an estimated 56 percent of the energy for production. The degree of adoption is estimated to be 5 percent and has experienced some popularity where it as been promoted. Higher investment cost and stricter operator skill requirements are the main barriers for the adaptation of the new technology. Energy consumption : The energy consumption for brick production in Vietnam varies from 0.88 – 2.2 MJ/kg, depending on the type of kiln and clay. The energy consumption of VSBK is lower than for traditional brick kilns. Table 9 - GHG emissions in the brick industry Items Unit 2002 2005 2010 2015 2020 Total brick production million 11,010 13,601 19,345 27,515 39,135 Total emission thousand tCO 2 -e 3,303 4,080 5,804 8254.5 11740.5 (MONRE, 2004) Assume that conventional technology is applied until 2010, vertical shaft brick kiln will be applied thereafter. Emission factor: conventional technology 0.3 tCO2/1000 units, VSBK 0.161 tCO2/1000 units Greenhouse gas emissions : The brick making industry emits an estimated 4.1 million tCO2-e per year from energy consumption. Based on continued use of current technologies this would grow at 23 percent per year until 2010 and 42 percent per year thereafter. Studies have indicated that with the introduction of more efficient technologies the emissions from 2010 to 2020 could reduce by nearly half (4,431 and 6,302 tCO2-e in 2015 and 2020, respectively) 5 . In addition to the rapid growth of the industry, the major reasons for the emissions trends are: · Large dependence (65 percent) on inefficient traditional kilns: · Dependence on coal as fuel. Iron and steel industry Vietnam produces 6,633,000 tons of steel products per year including 3,656,000 tons of “long products” such as bars, rods, rails and other elongated forms of steel and 2,977,000 tons of pipes and “flat products” such as flattened sheets and strips. The steel used to manufacture these products is both produced domestically and imported. For domestic steel production, seventy-seven percent of the raw material supply comes from domestic and imported scrap metal (693,000 tons per year) which is further refined into steel and the remainder (202,000 tons per year) comes from domestic iron ore extraction and iron production facilities which is processed from pig iron to steel. Steel is imported in the form of billets (2,158,000 tons per year) and flat products (2,958,000 tons per year), which along 5 MONRE 2004. Page 10 with the domestically produced steel is then rolled, shaped or coated in Vietnam to manufacture the final steel products 6 . The largest player in iron and steel production is the Vietnam Steel Corporation (VSC), accounting for nearly 50 percent of the iron and steel production 7 . VSC is comprised of 14 local members and 14 joint ventures with foreign companies that cover steel production, rolling, surface coating, secondary processing, distribution and research and development. VSC includes the follow facilities: · 21 electric steel manufacture kilns with a capacity of 180 tons of product, with a total annual output of 500,000 tons of steel; · 17 steel rolling lines, with a yearly output over 1,600,000 tons of a combination of laminated steel and construction steel products; · 7 manufacturing facilities with main products such as galvanized iron, black steel pipe and galvanized steel pipe, with a yearly output above 100,000 tons; · 2 blast-furnaces for iron production (about 50,000 tons per year of pig iron of different types); · 8 mines supplying millions of tons of raw materials to the sector each year. Since Doi Moi, larger private enterprises and foreign invested firms other than those under VSC have emerged as players in the country. It is estimated that in 2004 these firms accounted for 40 percent of the rolling capacity in the country and 20 percent of the electric arc furnace steel manufacturing. 8 . Additionally, small metal processing enterprises (about 160-170 9 in total also produce a variety of steel products and were estimated to account for 16 percent of the long product capacity in 2001 10 . Technologies : As the sector is largely dependent on scrap steel as a raw material, the steel production is predominantly in the form of “mini-mills” that utilize steel scrap, combined with produced steel in an electric arc furnace to produce steel that is then rolled into long products. Although some have been proposed, large-scale fully integrated systems that are commonly found in other countries are not common in Vietnam. These systems normally rely on pig iron produced in a blast furnace combined with steel production in open hearth or basic oxygen furnaces. Rather in Vietnam where iron ore is available typically a smaller hybrid system is used where the iron produced is processed along with scrap in an electric arc furnace process. The sector also uses imported flat products along with cold rolling technologies, pipe fitters and various coating technologies to product pipes and flat products. In general, the subsector technologies can be characterized as being largely based on old technologies with some upgrading and modernization. The most rapidly modernizing part of the subsector surrounds the expansions and construction activities of the joint venture companies (in VSC and outside). The older facilities are also undergoing upgrading but rely on older equipment and the very small traditional metal processing facilities are the least modern. Below is a brief overview of the technologies used. Iron making: Vietnam is not heavily dependent on domestically produced iron accounting for only 23 percent of the raw materials for steel production. The existing iron production facilities rely on old blast furnace and coke plant technology that has undergone some 6 Production numbers based on SEAISI (2006a and 2006b) as compiled and reported in Kawabata (2007). 7 VSC, 2005 8 Kawabata (2007) 9 VSC, 2005 10 Ernst and Young, 2003 Page 11 Iron Production Steel Making Rolling and finishing Heat (Fuel ) Electricity / Heat Electricity / Heat Iron Production Steel Making Rolling and finishing Heat (Fuel ) Electricity / Heat Electricity / Heat upgrades. Some energy saving techniques has been adopted including the use of sintered coal, and the installation of top pressure recovery power. Steel making : Steel making is largely done using electric arc furnaces. The electric arc furnaces in use in Vietnam include older furnaces that were constructed 10 years or more ago and the more modern ones that have been upgraded or constructed as part of the recent surge in steel making capacity led by VSC joint ventures and other large private companies. The more modern plants are more energy efficient and commonly employ continuous casting which saves energy in reheating the steel. Rolling: Rolling technologies vary by the enterprise with the most modern rolling technologies in the country being adopted by VSC and non-VSC foreign joint venture companies. Figure 2: Flow chart of energy use in the iron and steel industry Energy consumption : Energy consumption in the Vietnam iron and steel industry is higher than international benchmarks. For example, iron production has been estimated to consume 3 Gcal per ton of iron produced in Vietnam while in Japan it consumes 5.85 Gcal per ton 11 (MoIT CPI project). For steelmaking using electric arc furnaces, electricity use ranges from 600-900 kwh/ton 12 of steel while typical values internationally range from 350-700 kwh/ton. Electricity use in rolling mills in Vietnam ranges from 90 to 150 kwh/ton 13 . At the same time, energy intensity is reducing with the new technologies and upgrades as evidenced by the reduction in electricity use by VSC in steel making and rolling since 2000. Table 10 - Steel production and energy consumption of VSC for the 2000 –2004 period Items 2000 2001 2002 2003 2004 1. Steel billet production, Kwh/ton 752 732 725 620 600 2. Steel rolling, Kwh/ton 112 112 107 103 100 Source: VSC, 2005 Greenhouse gas emissions : The sources of GHG emissions in iron and steel include emissions from the process itself and from the energy used by the processes in the form of 11 M oIT Cleaner Production Initiative Project “Cleaner Steel Production Desired” 12 Based on data from Ernst and Young, 2003 and VSC, 2005. 13 Based on data from Ernst and Young, 2003 and VSC, 2005. Page 12 electricity and fossil fuel. The process related emissions are largely from the iron production process during the combustion of coal and coke; the reactions involved with the removal of carbon impurities in the iron ore; and the reactions between magnesium impurities in the iron ore and limestone. Though smaller in magnitude, steel production also has process related emissions including carbon dioxide emissions from the removal of carbon impurities and the use of carbon electrodes in electric arc furnaces. In Vietnam the sub-sector overall emitted an estimated 6.1 million tCO2-e per year in 2005, a value that is expected to grow to 10.5 million tCO2-e in 2010 due to the growth in the industry and low energy efficiency. Table 11 - GHG emissions in the iron and steel industry Items Unit 2002 2010 2015 2020 2025 Total production 14 thousand tons 2,100 10,500 17,000 27,000 34,000 Total emission 15 thousand tCO 2 -e 3,356 16,780 27,168 43,149 54,335 The major factors contributing to the amount of GHG emissions from this sector are: · Reliance on fossil fuel based electricity, fuel oil and coal for these processes. · Low energy efficiency plants in the older technologies. · Lack of iron production in the sector reduces overall emissions footprint. · Slow adoption of more energy efficient technologies. Pulp and paper industry The total pulp and paper production in Vietnam in 2006 was 370,000 and 960,000 tons, respectively. Additionally, Vietnam imports 63 percent of its pulp and 39 percent of its paper as domestic demand cannot be met by the existing capacity. Much of the production is for printing and writing papers for domestic use while the major export product is carton boxes and other packaging. In 2001, printing paper production accounted for 34 percent of the total paper production, while newsprint paper made up 12 percent 16 . The growth of the industry has been rapid with paper production tripling between 2000 (350,000 tons per year) and 2006 and a current average annual growth rate of 16 percent (newsprint 35 percent, printing & writing paper 20 percent, and packaging paper 16 percent). Table 12: Pulp and Paper Production 2000 2006 2010 Paper (tons/yr) 455,000 960,000 1,400,000 Pulp (tons/yr) 200,200 370,000 600,000 Based on actual production in 2000 and 2006 and projected for 2010 based on targets of VPC. There are over 300 paper manufacturing facilities, 28 of which are state owned. Vinapimex is the largest player accounting for nearly 38 percent of the paper production capacity and 57 percent of the pulp production capacity in the country in 2000 and possessing most of the larger scale facilities in the country. Otherwise the sector is dominated by smaller scale facilities that primarily produce lower quality paper products such as newsprint and writing paper. Since 2000, there has been shift toward more investment in larger facilities including most recently, plans of the Ministry of Industry to invest US$1.1 billion in order to scale up production to meet targets. 14 The forecast data on steel production is taken from the Master plan of steel development, VSC 15 Due to the unavailability of forecast emission data, the emission factor of steel production was estimated at 1.6 ton CO2/tons of product (VSC, 2005) 16 Ernst and Young, 2003 Page 13 Table 13 - Number of pulp and paper mills by size in Vietnam No. Capacity (tons/year) No. of plants % of total production 1 Large scale ( 20,000 ) 5 47.9 2 Medium scale ( 5,000) 20 24.3 3 Small scale ( 1,000) 75 20.3 4 Very small scale (< 1,000) 200 14.3 ( RCEE, 2005) Data from Annual Report of Vietnam Paper Corporation 2002 Technologies : Pulp production is a process that takes wood normally in the form of chips and separates the fibers from the remainder of the wood components by using chemical or mechanical processes. The fibers can then be bleached with chorine-based compounds or using other chemicals as in the case of more modern chlorine free process technologies. As discussed above only a portion of the pulp used in Vietnam is produced in the country while the remainder is imported normally in solid form. Paper is then produced from the pulp by spreading it in liquid form in an even layer, evaporating the water and drying. Chemicals can be added during various stages of this process to adjust the content of the paper or provide a coating. In Vietnam, much of the sector is dependent on technologies that are 10-30 years old, only some of which have been upgraded. There are only a few plants that can be considered to use up-to-date technologies, although the recently proposed investments may improve the technologies present in the country. Within the spectrum of technologies employed in Vietnam, 27 percent of the pulp and 36 percent of the paper production employs more advanced technologies involving the use of synchronous motors, automated process lines and more recently manufactured equipment. Approximately 47 percent 17 of the pulp and paper production uses outdated and minimally upgraded technologies employing asynchronous motor technology and domestically produced equipment and with no raw material cleaning systems or pulp purifying systems. The technology in the older plants are significantly less energy efficient as globally the industry has made large technological advances in saving both electrical and steam use over the last few decades. Additionally cogeneration using pulp and wood wastes is only employed in some plants and technologies for waste heat recovery and reuse are not fully exploited. Figure 3 - Flow chart of energy use in the paper industry 17 RCEE, 2005: final report to MONRE Raw material (wood) processing Pulping (digestion, washing, screening, evaporation) Bleaching Electricity Electricity / Heat Heat Paper Machine Drying & Finishing Electricity / Heat Heat Page 14 Energy consumption: The energy needs of pulp and paper in Vietnam is predominantly derived from electricity and coal, accounting for 52 percent and 30 percent of total energy consumption respectively. The major heat energy using processes are the drying process in paper production and the production of the steam used in evaporators in chemical based pulp production processes. Electricity is used for a variety of tasks including chipping, pumping, air handling and lighting. Additionally, when mechanical pulping is employed, it uses large quantities of electricity. In some plants, the steam is powered by waste wood and pulp as a form of cogeneration and heat for drying is also sourced from waste heat. Overall the pulp and paper industry is a high energy consuming industry accounting for 7 percent of electricity use and 9 percent of coal consumption in industry. In 2002, the industry consumed 597 million kWh of electricity, 350,000 tons of coal, 11,200 tons of diesel and 87,000 tons of fuel oil. The energy efficiency is low due to the use of an old technology and there is also limited exploitation of energy recovery and reuse systems such as waste heat recovery and co-generation. Table 14 - Energy consumption projection in pulp and paper industry (2010 – 2030) Fuel type 2010 2012 2020 2030 Gasoline (tons) 96 108 172 308 Fuel Oil (tons) 192909 221730 386996 776354 Diesel (tons) 20084 23038 39880 79187 Coal (tons) 594532 684503 1132126 2290297 Electricity (MWh) 862378 1009607 1896577 4171028 (RCEE, 2005) Forecast data from Institute of Energy. No forecasting method mentioned in the report. Greenhouse gas emissions: The sources of greenhouse gas emissions from the pulp and paper industry are from the energy use and process emissions. Energy use produces GHG emissions from fossil fuel based electricity used in the production process and coal and other fossil fuels used to produce steam for the pulping process, paper drying, and power other processes depending on the facility. Process emissions include those from the reaction of carbonate based chemicals used in the pulping process and methane produced from the wastewater and solid waste during disposal. In 2000, the total CO2 emissions were 1.2 million tons, was just under 1.4 million tons in 2002 and is anticipated to grow to 2.5 million tons in 2010. 18 The CO2 emission projections in the pulp and paper industry are given in Table . Table 15- GHG emission projections in the pulp and paper industry (2010 – 2030) 2010 2012 2020 2030 Total emission (thousand tCO 2 -e) 2,592 2,994 5,162 10,622 The major factors contributing to these emissions trends are: · Reliance upon fossil fuels for energy including electricity from grid (52%); coal (30%), fuel oil (17%) and gasoline and diesel (1%). · Reliance on old, energy intensive technologies and slow adoption of newer technologies. · Lack of heat recovery and cogeneration systems · Lack of methane recovering wastewater systems. 18 CO2 emissions are calculated based on energy emissions only using the following emission factors (ton CO2/tons fuel): Coal: 2.31; Fuel oil: 3.24, Diesel: 3.16, Gasoline: 2.58. For electricity: 0.615 tons CO2/MWh. Page 15 Page 16 0 20 40 60 80 100 2002 2010 2015 2020 m i l l i o n t C O 2 - e / y r Cement Brick Iron and steel Pulp and paper Figure 4 Trends in GHG emission from major industrial sub-sectors Climate Change Mitigation Opportunities in the Industry Sector for 2010 to 2015 A list of potential typologies of interventions were evaluated to understand their potential for sector wide reductions in emissions of GHGs. Based on the sector potential and the relative challenges of implementing the typology in a portion of the sector, potentially feasible interventions were characterized based a set of criteria important to their implementation potential including estimates of potential emission reductions, in-roads institutionally, and methodology and additionality issues. While all interventions are believed to have potential as “win-win” or “no-regrets” interventions under the CDM, considerations on the related co-benefits and financial cost (if any) related to the intervention was also included in the evaluation and as summarized in the Annexes. All calculations of the emission reduction potentials were based on the sector structure over the time span of 2010 and 2015 and used CDM and IPCC methodologies where available and local emission factors where available. Overview of the potential As GHG emissions from the industrial sub-sectors are mainly from fuel and electricity consumption, the solutions for GHG emission reduction consist in technology optimization and upgrading, aiming at fuel and electricity savings. Page 17 \ Typologies of potential CCM projects in the sector To understand the options for the sector, for each industry typologies of likely projects were assessed. The typologies explored are listed below. Table 16: Typologies considered Industry Typology of Intervention Description C1 Fuel switching: Substituting coal by biomass (rice husk, saw dust). C2 Cement blending: Increasing the blending of other materials (ash, etc) to reduce the clinker content and production. C3 Waste heat power generation: Recovery of waste heat from the pre- heater and clinker cooler in steam boilers for power generation in condensing turbines. Cement C4 Energy efficiency. Improving energy efficiency in existing and new plants. Brick industry: B1 Energy efficiency improvement Replacement of traditional kilns with vertical shaft brick kilns. S1 Waste heat recovery, coke dry quenching, top pressure recovery turbine; utilization of furnace gas. Iron and Steel Industry: S2 Improvement in energy efficiency Variety of energy efficiency interventions Pulp and Paper: P1 Cogeneration/Combined Heat and Power Cogeneration of wood and paper wastes. Cement industry a.Project type C1: Fuel Switching in Cement Industry (i) Project Technologies and Activities The cement industry in Vietnam currently relies on fossil fuel based energy. No utilization of waste (tyres, plastic, etc.) and biomass (rice husk, saw dust, etc.) have been reported. Therefore there is a very significant CO2-saving potential from such solutions, which are already widely applied internationally. Surveys on biomass in Vietnam show large amounts of unused rice husk, wood fuel and other biomass that could be used in the cement industry. As most cement plants are situated along river banks, waste and biomass can be easily transported to the plants. A 20 percent utilization of biomass or waste at 2 production facilities could save as much as 175,000 tons of CO2 per year. However, most facilities in Vietnam have not yet considered such options. (ii) Baseline and Additionality Issues The baseline scenario considers that all cement plants use traditional technology and coal as a fuel. The alternative scenarios consider the utilization of waste and biomass. They can be used in the existing plant to replace coal or in new plants. At present, so few projects have been invested in cement industry that it would not be difficult to demonstrate additionality. New lines with higher production represent large investments. Consequently, limited investment capabilities are used for current system improvement. Furthermore, so far there is no financial support from the Government to cement companies to encourage them to invest in energy efficiency projects. (iii) Assessment of Applicable CDM methodologies There is an approved methodology by CDM Executive Board in the area named AC M 0003: Fuel switch substituting coal with waste, biomass, etc. Page 18 0 .0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% 90.0% 100.0% - 500,000 1,000,000 1,500,000 2 ,000,000 2,500,000 E            C ement Fuel switching (41 plants) m i l l i o n t C O 2 - e / y (iv) GHG Emission Reduction Potential The GHG emission reduction by applying fuel witching solution- substituting 13 percent coal in all 41 cement plants by biomass- the GHG emission reduction is 2.155 million tCO2-e/yr. % sector c overed Cumulative Emission reduction ( tCO2-e/yr) 2.4% 162,899 4.9% 311,835 7.3% 442,154 9.8% 572,473 12.2% 642,287 14.6% 707,447 17.1% 772,606 19.5% 828,457 22.0% 870,346 100.0% 2,154,920 Figure 5 GHG emission reduction from fuel switching in cement industry (v) Examples of potentially feasible sector-wide interventions: Intervention Potential structure and in-roads Estimated GHG reduction Estimated CDM Revenues Fuel switching from coal to biomass (13%) for 9 plants of VNCC Work with 1 company and 9 plants New World Bank counterpart 870,346 tCO2-e/yr (2% emission from cement industry) $ 8.7 million per year (about $1 million per plant) b. Project type C2: Blending (i) Project Technologies and Activities The cement industry in Vietnam primarily produces cement of the PCB30 quality, which allows blending of 40 percent additives according to standards from the Vietnam Association of Building Materials (VABM). PCB40 is also produced, which is of a higher quality and allows lower degree of blending At present, the ratio of additives in cement product is only 18-20 percent, thus there is a very significant CO2-saving potential by reducing the clinker content of PCB30. However it requires a higher quality of clinker to ensure the quality of the final product. (ii) Baseline and Additionality Issues Page 19 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% 90.0% 100.0% - 100,000 200,000 300,000 400,000 500,000 600,000 700,000 800,000 900,000 1,000,000 E               Cement blending (41 plants) t C O 2 - e / y The baseline scenario considers that all cement plants use traditional blending ratios. The alternative scenarios take into account increased blending. In term of barriers, the same challenges are met as in the fuel switching typology. Blending represents a huge opportunity in CDM potential, however, this solution is widely applied in Vietnam and it is difficult to register as CDM project. Experience from Chinese CDM projects indicates difficulties in registration of projects of this type if blending results in increased production capacity. (iii) Assessment of Applicable CDM methodologies An approved methodology is ACM0005: Blending of clinker to cement with CO2-free additives. However this methodology is current on hold by the CDM Executive Board. (iv) GHG Emission Reduction Potential The emission factor for clinker production is 0.5071 tCO2/ton clinker 19 . In the project, the ratio of additives in blending is increased by 5 percent from 20 percent to 25 percent. The GHG emission reduction potential is 923,537 tCO2-e/yr if the solution is applied for all 41 cements plant. % sector covered Emission reduction (tCO2-e/yr) 2.4% 69,814 4.9% 133,644 7.3% 189,495 9.8% 245,346 12.2% 275,266 14.6% 303,191 17.1% 331,117 19.5% 355,053 22.0% 373,005 100.0% 923,537 Figure 6 GHG emission reduction from blending solution in cement industry (v) Examples of potentially feasible sector-wide interventions: Intervention Potential structure and in-roads Estimated GHG reduction Estimated CDM Revenues Blending solution for 9 plants of VNCC (22% numbers of plants) Work with 1 company and 9 plants New World Bank counterpart 373,000 tCO2-e/yr (0.9% emission from cement industry) $ 3.7 million per year (about $0.4 million per plant) c. Project type C3: Waste Heat Power Generation (WHPG) (i) Project Technologies and Activities 19 Data taken from IPCC (1996) Page 20 Thanks to the waste heat recovery system, recuperation of waste heat from the pre-heater and clinker cooler in steam boilers can be used for power generation in a condensing turbine. This power production can be consumed by the process or delivered to the grid whenever possible. The power consumption from the public grid will be reduced. So will GHG emissions. (ii) Baseline and Additionality Issues The baseline scenario considers that all cement plants use traditional technology. The alternative scenarios take into account the utilization of waste heat for generation. There are the same barriers as for project type C1 and C2. One project was implemented in Vietnam in the Ha Tien 2 plant (NEDO funding). The capacity is 3 MWe. The project is a demonstration project for energy consumption reduction, not a CDM project. (iii) Assessment of Applicable CDM Methodologies The methodology is approved by CDM Executive Board: AM0024: Cogeneration from waste heat from the kiln (iv) GHG Emission Reduction Potential The GHG emission reduction by utilizing waste heat for power generation in all 40 cement plants by biomass- the GHG emission reduction is 640,426 tons CO2-e/yr. Figure 7 GHG emission reduction from WHPG in cement industry (v) Examples of potentially feasible sector-wide interventions: It is expected that such solution can be applied for most of the 14 existing large kilns as well as for most of the 20 large kilns planned to be implemented. VICEM considers this technology as interesting and is presently planning to carry out feasibility studies at 8 major production facilities in order to assess its technical and economical feasibility. An intervention covering all the existing and planned kilns would result in emission reductions of 245,878 tCO2e per year. Intervention Potential structure and in-roads Estimated GHG reduction Estimated CDM Revenues Waste heat power generation solution for 8 plants of VNCC Work with 1 company and 8 plants New World Bank counterpart 245,878 tCO2-e/yr (0.6 % emission from cement industry) $ 2.5 million per year (about $0.3 million per plant) % sector covered Emission reduction (tCO2-e/yr) 2.5% 50,033 5.0% 95,778 7.5% 135,805 10.0% 175,831 12.5% 195,844 15.0% 215,858 17.5% 233,012 20.0% 245,878 100.0% 640,426 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% 90.0% 100.0% - 100,000 200,000 3 00,000 400,000 500,000 6 00,000 700,000 E     W HPG       Cement WHPG (40 plants) t C O 2 - e / y Page 21 0.0% 20.0% 40.0% 60.0% 80.0% 100.0% - 1,000,000 2,000,000 3,000,000 4,000,000 5,000,000 6,000,000 7,000,000 E                Cement EE (41 plants) t C O 2 - e / y d. Project type C4: Energy efficiency (i)Project Technologies and Activities There are CDM-methodologies for energy saving projects in the cement industry. The solutions applied to improve energy efficiency include: - Replace ball grinder by roller grinder in grinding raw material (limestone, coal). - Replace ball grinder by roller grinder in grinding clinker. - Use high efficient mechanical classifier to separate over-size material (limestone, clinker) to back to grinder. - Improve pre-heaters. - Improve efficiency in lighting. - Improve efficiency in fan system. - Apply inverters for motors Such projects (Improvement of grinders/clinker mills projects; improvement of pre-heaters projects; improved control of fans projects) have been applied internationally. (ii) Baseline and Additionality Issues The baseline scenario considers that all cement plants use traditional technology. The alternative scenarios take into account the improvement in energy consumption and therefore, enhance the energy efficiency in the plants. In Vietnam a number of plants apply open type ball mills while newer plants apply closed ball mills with a higher efficiency. It is even more efficient if roller grinder is used. It is expected that such a solution will be relevant for a large number of cement kilns in Vietnam. The principle will however not be relevant in all cases if the waste heat can instead be used for power generation according to AM0024 above. It should be clarified whether the improvement of pre-heaters also increases production capacity of the cement plants. (iii) Assessment of Applicable CDM methodologies The methodology approved by CDM Executive Board. AMS-II.D: Energy savings optimizing mills, pre-heaters and fans etc. (iv) GHG Emission Reduction Potential The GHG emission reduction by improving energy efficiency by 15 percent for electricity and 26 percent for fuels in all 41 cement plants by biomass- the GHG emission reduction is 6.2 million tCO2-e/yr. Figure 8 GHG emission reduction from energy efficiency improvement solution in cement industry % sector covered Cumulative Emission reduction (tCO2-e/yr) 2.4% 465,426 4.9% 890,957 7.3% 1,263,298 9.8% 1,635,638 12.2% 1,835,106 14.6% 2,021,277 17.1% 2,207,447 19.5% 2,367,021 22.0% 2,486,702 100.0% 6,156,915 Page 22 (v) Examples of potentially feasible sector-wide interventions Intervention Potential structure and in-roads Estimated GHG reduction Estimated CDM Revenues Energy efficiency improvement solution for 9 plants of VNCC (22% numbers of plants) Work with 1 company and 9 plants New World Bank counterpart 2,486,702 tCO2-e/yr (6% emission from cement industry) $ 25 million per year (about $2.7 million per plant) Brick making Project type B1: Replacement with vertical shaft brick kiln (i) Project Technologies and Activities The vertical shaft brick kilns have better energy efficiency and higher productivity than traditional kilns. Replacement of the old traditional kilns with the vertical shaft brick kilns (VSBK) are expected to reduce the energy consumption and to offer a potential of CO2 emission reduction. This replacement can save up to 50 percent of the fuel consumption. (ii) Baseline and Additionality Issues The baseline scenario considers that all bricks are produced by traditional kilns. In the alternative scenario, the vertical shaft brick kilns replace all traditional kilns. The higher investment cost for the construction of the vertical shaft brick kilns is the most prominent barrier as investors are mostly small entrepreneurs. In 2001, the Small Grant Program Operations (SGP) (UNDP – GEF) supported the Vietnam Association of Thermal Science and Technology and the Institute of Heat Engineering and Refrigeration to implement a project on “Developing a model of vertical shaft brick kiln with high efficiency” to promote the application of vertical shaft brick kilns in Vietnam. This VSBK model was then introduced in the UNDP-GEF program “Promoting Energy Conservation in Small and Medium Enterprises” (PECSME) and achieved some significant results in energy savings and environmental improvement. The technology are rather simple and does not require high investment capital, nor professional labor skills as compared to tunnel technology. However, to the small scale manufacturers, need of financial and technical support as the initial investment represents a large capital outlay for them and the operation of the technology is new to them. (iii) Assessment of Applicable CDM Methodologies There is no approved methodology in the area (iv) GHG Emission Reduction Potential The potential GHG emission represents around 170 thousand tCO 2 -e/yr if 100 percent of traditional kiln is replaced by vertical shaft kiln. % replacement Emission reduction (tCO2-e/yr) 10% 17000 20% 34000 30% 51000 40% 68000 50% 85000 60% 102000 70% 119000 80% 136000 0 40,000 80,000 120,000 160,000 200,000 0 % 1 0 % 2 0 % 3 0 % 4 0 % 5 0 % 6 0 % 7 0 % 8 0 % 9 0 % 1 0 0 % % replacement t C O 2 - e / y r Page 23 90% 153000 100% 170000 Figure 9 GHG emission reduction vs. replacement of traditional kiln by vertical shaft kiln (v) Examples of potentially feasible sector-wide interventions: Intervention Potential structure and in-roads Estimated GHG reduction Estimated CDM Revenues Introduction of VSBK in 40% of traditional kilns Through intermediary bank or using mechanism utilized by GEF project 68,0000 tCO2-e/yr $ 680,000 per year Iron and steel industry a. Project type S1: Waste heat recovery ( i ) Project Technologies and Activities Waste heat recovery in the steel production can be done follow the Blast Furnace’s Top Pressure Recovery Turbine (BF-TRT) technology and Basic Oxygen Furnace (BOF) gas recovery technology. BF-TRT can be applied for pig-iron production and BOF is used for billet production. (ii) Baseline and Additionality Issues The baseline scenario considers that all steel production facilities use traditional technology. The alternative scenario considers waste heat recovery for saving electricity.. There are some barriers for such kind of project to be implemented: - Lack of government policy and incentive mechanism to promote the implementation of projects - Limited awareness of owners There is no information available about CDM projects under development in iron and steel industry in Vietnam. (iii) Assessment of Applicable CDM Methodologies An approved small scale methodologies is as follow: AMS-III.Q: Waste Energy recovery (gas/heat/pressure) projects (iv) GHG Emission Reduction Potential The emission reduction is calculated based on the following assumptions: - BF-TRT technology is applied for pig-iron production in 1 major plant (Thai Nguyen Iron and Steel Company TISCO), 4 small plants 20 and 9 other plants 21 . The emission reduction is 17.377 tCO2-e/ ton of final production 22 - BOF is applied for billet production in 3 VSC plants 23 and 4 non VSC plants 24 . The emission reduction is 49.263 tCO2-e/ton of final production 25 20 Nguyen, V. S. (2008) 21 ,Ernst & Young (2003) 22 Michaelowa, A. (2005) 23 Ernst & Young (2003) Page 24 Emission reductions from WHR in steel and iron industry - 20,000 40,000 60,000 80,000 100,000 120,000 0% 20% 40% 60% 80% 100 % t C O 2 - e / y Steel WHR (14 plants) The total GHG emission reduction for 14 above plant is 113,160 tCO2-e/yr. Figure 10 GHG emission reduction from WHPG in iron and steel industry (v) Examples of potentially feasible sector-wide interventions Intervention Potential structure and in-roads Estimated GHG reduction Estimated CDM Revenues Waste heat recovery solution for 5 plants of VSC Work with 1 company 57,665 tCO2-e/yr (0.4 % emission from iron and steel industry) $ 0.58 million per year (about $ 0.11 million per plant) b. Project type S2: Energy efficiency ( i ) Project Technologies and Activities The improvement in energy efficiency in furnace, dry system will lead to savings in electricity and fuel. Coke Dry Quenching (CDQ) technology and Pulverized Coal Injection (PCI) technology can be applied for pig iron production while Re-heating for Electric Arc Furnace (EAF-RH) is used for rolling production. (ii) Baseline and Additionality Issues The baseline scenario considers that all steel production facilities use traditional technology. The alternative scenario considers the improvement in energy efficiency of furnace and dry system. There are the same barriers as in project type S1 apply to this technology. (iii) Assessment of Applicable CDM Methodologies A CDM project on power generation using waste heat from the CDQ equipment has been successfully developed in China, applying the CDM methodology ACM 0024. However, the expected amount of CER generated from individual project is somewhat less attractive and their additionality depends on case-specific factors. (vi) GHG Emission Reduction Potential The potential GHG emission is calculated base on the following assumptions: - CDQ technology and PCI technology are applied for pig-iron production, and EAF- RH is applied for furnace in 1 major plant (TISCO). The emission reduction by using CDQ, PCI is 60.772 tCO2-e/ton of final product, 126.367 tCO2-e/ton of product respectively 26 , by using EAF-RH is 31.701 tCO2-e/ton of final product 27 . - EAF-RH is applied for 18 rolling plants 28 Total GHG emission reduction in 19 plants is 182,291 tCO2-e/yr. 24 Nguyen, V. S. (2008) 25 RCEE (2005) 26 Michaelowa, A. (2005) 27 RCEE (2005) 28 Ernst&Young (2003) % sector covered Cumulative Emission reduction (tCO2-e/yr) 0% 0 7% 18254.55 21% 57665.75 100% 113159.4 Page 25 Emission reductions from EE in steel and iron industry - 50,000 100,000 150,000 200,000 0% 20% 40% 60% 80% 100 % t C O 2 - e / y Steel EE (19 plants) Figure 11 GHG emission reduction from EE improvement solution in iron and steel industry (v) Examples of potentially feasible sector-wide interventions Intervention Potential structure and in-roads Estimated GHG reduction Estimated CDM Revenues Energy efficiency improvement solution for 5 plants of VSC Work with 1 company 84,969 tCO2-e/yr (0.5 % emission from iron and steel industry) $ 0.8 million per year (about $ 0.16 million per plant) Pulp and paper production Project type P1: Cogeneration/Combined Heat and Power (CHP) (i) Project Technologies and Activities Cogeneration, also know as “Combined Heat and Power” (CHP), is defined as the simultaneous generation of two forms of energy (heat and power) from the same plant using one single primary energy source. All pulp and paper mills use steam and electricity with steam produced using fossils fuels and electricity purchased from the grid. The main advantage of cogeneration is fuel savings (25-30 percent) when compared to separate generation of electricity and heat. The fuel used in cogeneration can be coal, oil, gas or even biomass in conjunction with energy producing steam turbines, reciprocating engines or gas turbines. As a coal-intensive industry in Vietnam, the pulp and paper industry can largely benefit from cogeneration and offer the high potential of GHG emission reduction. % sector covered Cumulative Emission reduction (tCO2-e/yr) 0% 0 5% 45343.22 26% 84969.47 53% 114768.4 6 3% 130618.9 100% 182291.5 Page 26 B oiler Electricity demand S team demand s team Electricity from national grid F uel (coal, oil, gas, etc) Cogeneration system Electricity demand Steam demand steam Electricity Fuel (coal, oil, gas, etc) Energy system without cogeneration Energy system with cogeneration Figure 12 Energy system in pulp and paper mills with and without cogeneration (ii) Baseline and Additionality Issues The baseline scenario considers that electricity used in paper mills is supplied from the national grid. In the alternative scenario, a cogeneration plant supplies steam and electricity. The investment cost is around 1200 USD/kW. Efficiency in paper mills will increase, leading to a decrease in fuel consumption and GHG emissions. Combined heat and power is economically cost-effective. Therefore, several cogeneration facilities have already been installed in the pulp and paper industry in Vietnam. However, in recent years, no new investment in cogeneration in this sub-sector was made, mainly due to high investment costs and an increased price of coal. Alternatives to coal can be natural gas or biomass. However, most of the natural gas is presently used for power plants. The feasibility of biomass cogeneration is not very good due to high investment costs and unclear biomass supply sources. There is a project in Phong Khe village involving the construction of a cogeneration system with a steam capacity of 60 ton per hour and electricity capacity is 6.4 MW. Total CO2 emission reduction is 74,717 tCO2-e/yr. (iii) Assessment of Applicable CDM Methodologies Several CDM methodologies can be applied to these types of projects, depending on the fuel type and use of energy. (iv) GHG Emission Reduction Potential The GHG emissions reduction by cogeneration solution for all pulp and paper industry, including about 150 plants, is 381,250 tCO2-e/yr. Page 27 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% 90.0% 100.0% - 100,000 200,000 300,000 400,000 5 00,000 Emission reductions from cogeneration in paper industry Paper Cogeneration (150 p lants) t C O 2 - e / y Figure 13 GHG emission reduction from cogeneration in pulp and paper industry (v) Examples of potentially feasible sector-wide interventions Intervention Potential structure and in-roads Estimated GHG reduction Estimated CDM Revenues Cogeneration solution for 7 plants of Vinapimex Work with 1 company 207,352 tCO2-e/yr (7% emission from pulp and paper industry) $ 2 million per year (about $ 0.3 million per plant) % sector covered Cumulative Emission reduction (tCO2-e/yr) 0.0% 0 0.7% 80,874 1.3% 155,927 2.0% 174,908 2.7% 191,667 3.3% 198,708 4.0% 203,237 4.7% 207,352 100.0% 381,250 Page 28 Annex 1: References Cogen3, 2003: Technical report, available cogeneration technologies in Europe. Ernst & Young, 2003: Operational Review of State Owned Enterprises in the Steel Industry: Thai Nguyen Iron and Steel Company (TISCO) . Final Summary Report. Ernst & Young, 2003b: Operational Review of State Owned Enterprises in the Cement Industry: Hoang Thach Cement Company . Appendices to the Final Summary Report. GSO, 2007: Vietnam Statistical Yearbook 2006 . A. Michelowa, 2005. Promising project categories for large-scale energy efficiency improvement in industry. Pr esentation at workshop “Future CDM”, Tokyo, 2005. MOI, 2005: Strategies of Vietnam Industry development. MOIT, 2007: Master Plan for Vietnam Power Development period 2006-2015, prospective to 2025 . MONRE, 2004: Summarizing, correcting and editing results on identification of GHG reduction demand in energy, transport and non-energy sectors . MONRE, 2004b: Evaluating the Effectiveness of the Economy-Environment Factor in GHG Emission Reduction in the Energy Sector MONRE, 2005: Assessment of the demand for GHG reduction technology in industry sector in Vietnam. Nguyen, V. S. (2008): Steel industry of Vietnam: Development progress and current situation of technology. Presentation at the training course "Energy Management and Energy Efficiency in Steel Industry", 24-25 Oct. 2008 RCEE, 2005: Assessment of GHG emission and CDM potential in some selected industries. Final report to MONRE. RCEE, 2007. Survey on cement industry sector. Intermediate report to the Royal Danish Embassy in Hanoi. RCEE, 2008: Energy efficiency potentials in the cement sector of Vietnam. Final report to the Ministry of Industry and Trade, December 2008. VABM, 2007: Overview of Vietnam Cement industry. Intermediate report to the Royal Danish Embassy in Hanoi. VSC, 2005: Preliminary report on energy saving measures in steel industry . VSC: Vietnam steel development plan up to 2010 and prospective to 2020 VABM, 2007: Yearly report of VABM Page 29 E 0.0% 20.0% 40.0% 60.0% 80.0% 100.0% CO C EE  C F C C WHPG  P C S EE  B V K S WHR  Annex 2: Summary of potential emission reductions from interventions in industry Note: Estimates based on annual reductions during 2010-2015 Page 30 A n n e x 3 : S u m m a r y o f p o t e n t i a l l y f e a s i b l e s e c t o r - w i d e i n t e r v e n t i o n s i n i n d u s t r y G H G r e d u c t i o n p o t e n t i a l ( 2 0 1 0 t o 2 0 1 5 ) S e c t o r P r o g r a m I n t e r v e n t i o n G H G e m i s s i o n s i n 2 0 1 0 ( m i l l i o n t C O 2 - e ) T o t a l P o t e n t i a l ( m i l l i o n t C O 2 - e / y ) F o r p r o g r a m i d e a ( m i l l i o n t C O 2 - e / y ) C o - b e n e f i t s a n d F i n a n c i a l C o I n d u s t r y 4 0 . 3 1 0 . 7 4 . 4 C 1 C e m e n t A p p l y i n g f u e l s w i t c h i n g i n 9 c e m e n t f a c t o r i e s o f V I C E M 2 . 2 0 . 8 7 F u e l s a v i n g s ; r e d u c e d a i r p o l l u t i T y p i c a l l y p r o f i t a b l e w i t h C D M C 2 C e m e n t I n c r e a s e d b l e n d i n g o f c e m e n t f o r 9 c e m e n t f a c t o r i e s o f V I C E M 0 . 9 2 0 . 3 7 F u e l s a v i n g s ; T y p i c a l l y p r o f i t a b l e C D M C 3 C e m e n t R e c o v e r y o f w a s t e h e a t i n 9 c e m e n t f a c t o r i e s o f V I C E M f o r p o w e r g e n e r a t i o n 0 . 6 4 0 . 2 4 6 F u e l s a v i n g s ; r e d u c e d a i r p o l l u t i T y p i c a l l y p r o f i t a b l e w i t h C D M C 4 C e m e n t E n e r g y e f f i c i e n c y i m p r o v e m e n t f o r 9 p l a n t s i f V I C E M 6 . 1 2 . 5 F u e l s a v i n g s ; r e d u c e d a i r p o l l u t i T y p i c a l l y p r o f i t a b l e w i t h C D M B 1 B r i c k R e p l a c e m e n t o f t r a d i t i o n a l k i l n s w i t h V e r t i c a l S h a f t B r i c k K i l n f o r 4 0 % o f t r a d i t i o n a l k i l n s 0 . 1 7 0 . 0 6 8 F u e l s a v i n g s ; r e d u c e d a i r p o l l u t i T y p i c a l l y p r o f i t a b l e w i t h C D M S 1 I r o n a n d S t e e l R e c o v e r y o f w a s t e h e a t i n 3 i r o n a n d s t e e l f a c t o r i e s b e l o n g i n g t o V S C f o r p o w e r g e n e r a t i o n o r h e a t i n g 0 . 1 1 3 0 . 0 5 8 F u e l s a v i n g s ; r e d u c e d a i r p o l l u t i T y p i c a l l y p r o f i t a b l e w i t h C D M S 2 I r o n a n d S t e e l I m p r o v i n g e n e r g y e f f i c i e n c y i n 5 i r o n a n d s t e e l p l a n t s b e l o n g i n g t o V S C 0 . 1 8 2 0 . 0 8 5 F u e l s a v i n g s ; r e d u c e d a i r p o l l u t i T y p i c a l l y p r o f i t a b l e w i t h C D M P 1 P u l p a n d P a p e r C o g e n e r a t i o n / C o m b i n e d H e a t a n d P o w e r i n 7 p u l p a n d p a p e r p l a n t s b e l o n g i n g t o V i n a p i m e x 0 . 3 8 1 0 . 2 0 7 F u e l s a v i n g s ; r e d u c e d a i r p o l l u t i T y p i c a l l y p r o f i t a b l e w i t h C D M Page 31