NDF - Financing for climate change and development projects

Reducing CO2 emissions through biogas expansion in Vietnam

13.03.2013

NDF provides EUR 4.1 million to support the transfer and pilot testing of innovative biogas technologies in Vietnam

The agricultural sector is a major contributor to Vietnam’s economy. However, it is also a major contributor to environmental degradation in two important ways. First, it is the largest contributor to national greenhouse gas emissions, especially methane generated from livestock waste and wet rice cultivation. Second, the discharge of untreated livestock waste is contaminating the environment with high levels of pathogens, endangering the health of people and animals. In addition, over 40% of arable land is now degraded because of the heavy use of inorganic fertilizers and other unsustainable agricultural practices. To meet the demand for safe food and a healthy environment it is necessary for Vietnam to progressively adopt the use of climate smart agriculture practices.

NDF will finance transfer and pilot testing of innovative biogas technologies in partnership with the Asian Development Bank (ADB) through the project: Low Carbon Agricultural Support Project (LCASP) in Vietnam. The NDF support will help LCASP demonstrate effective utilisation of biogas, strengthen value chains and develop linkages with academia/technical institutions. The NDF project will furthermore support Nationally Appropriate Mitigation Actions (NAMA) development relating to waste management in Vietnam.

Small biogas plant construction technology is well-established in Vietnam. For medium and large biogas plants, however, technical options vary according to farm-specific parameters. The project will improve the capacity of beneficiaries to select the best technical option. Design and implementation quality will ensure that investments are technically and environmentally sound, meet certified emission reduction (CER) mechanisms, and are financially viable. Research, training, extension, infrastructure, technology and other development support will improve the knowledge base, productivity, and profitability.

The project will focus on expansion of biogas in ten provinces located in northern, central and southern parts of Vietnam. NDF will support small, medium and large scale biogas plants and contribute to tangible improvements in livelihoods of small farmers.

“We expect that livestock farmers will benefit considerably from the project in terms of time and cost savings from energy substitution and fewer livestock disease outbreaks will boost beneficiaries’ incomes. Application of bio-slurry fertilizer will also improve crop productivity while reducing input costs. Small businesses will benefit since here will be a market for biogas stoves, lamps and spare-parts. Excess gas, electricity and organic fertilizer could be sold which would generate additional income opportunities for the local rural communities,” says NDF Country Program Manager Martina Jägerhorn , who adds that “other business that could also benefit include small-scale energy companies, biogas plant construction companies and companies to build, operate, and maintain mini-grid stations”.

NDF support will be joint co-financing with the Asian Development Bank (ADB) which will employ consultancy firms and/or individual consultants to carry out the activities of the project. ADB procurement rules will be followed in the procurement of consulting services. Consulting opportunities related to this project will be published simultaneously on the webpages of NDF and the ADB.

More information

Biogas Expansion under the Low Carbon Agricultural Support Project, Vietnam