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Official Gazette

Wednesday, April 1, 2020

Law on energy conservance

Updated: 10:56’ - 15/06/2011

Passed in June, the Law on Energy Efficiency and Conservance aims to promote national energy development, energy security assurance, and rational and effective exploitation and use of domestic energy resources for environmental protection and socio-economic development.

The 48-article Law, which will take effect early next year, provides for policies and measures to promote energy efficiency and conservance; and rights, obligations and responsibilities of organizations, households and individuals in energy efficiency and conservance.

State policies on energy saving include giving top priority to the application of energy-saving measures; providing financial support, energy price subsidy and other incentives; increasing investment in the application of advanced technologies; developing renewable energy suitable to Vietnam’s potential and conditions; and encouraging the use of energy-saving equipment and the development of counseling services.

The Law prohibits the following acts:

- Destroying national energy sources;

- Committing frauds to enjoy state incentives;

- Abusing powers in the management of energy efficiency and conservance for self-seeking purposes;

- Intentionally providing untruthful information on the energy consumption of equipment in energy labeling, inspection, advertising and other activities which harm the interests of the State and lawful rights and interests of organizations, households or individuals; and,

- Manufacturing, importing or circulating energy-consuming equipment subject to elimination.

Management of energy consumption by intensive energy consumers is specified in Chapter VIII of the Law. Accordingly, intensive energy consumers, including industrial production establishments, civil construction works and transport establishments, are subject to energy consumption management.

They have to work out and realize annual and five-year energy-saving plans in line with their production and business plans and report to competent authorities on the implementation of such plans.

They are also obliged to conduct energy audit every three years and apply energy management models under the guidance of competent state authorities.

The Law requires intensive energy consumers to conduct energy audit themselves or hire energy audit institutions to do so.

Such an energy audit institution must be a lawfully established legal entity that has certified energy auditors and have technical energy audit equipment.

Energy managers, appointed by intensive energy consumers, must possess an energy management certificate and hold a collegial or higher degree in energy or a relevant technical discipline, for intensive energy consumers in industrial production, construction and service provision, or a relevant technical secondary or higher degree, for those in agricultural production and transport.

An energy manager will assist the head of an intensive energy consumer in elaborating annual and five-year energy-saving plans; organizing energy use management networks and applying energy management models; taking energy-saving measures under approved objectives and plans and examining the application of these measures; monitoring energy consumption of equipment and the entire production line, and changes in energy consumption demand.

Unlike intensive energy consumers, communities and small- and medium-sized enterprises are only encouraged to apply this Law. Households are encouraged to design and build houses capable of utilizing natural light and ventilation; use heat-insulated materials and energy-saving home appliances; use equipment using renewable energy; and limit the use of high-capacity and power-intensive equipment during peak hours.

The Law requires the labeling of energy-consuming products in order to step up the creation of high-efficiency equipment and gradually remove equipment with backward technologies and reduce energy wastage in production.

Labeling of energy-consuming products not only helps consumers easily select household appliances but also serves as a technical barrier to backward and low-efficiency equipment.

Equipment subject to energy labeling must be labeled prior to market sale. Manufacturers and importers of equipment must label them after obtaining energy label certificates from competent authorities.

Such certificates will be granted after equipment has been tested to meet energy consumption standards.

Nguyen Dinh Hiep, director of the Energy Conservance Office under the Ministry of Industry and Trade, said that according to Vietnam’s committed roadmap, voluntary labeling of household appliances will be completed before July 2011; photocopiers and computers’ power supply units, before January 2014; and industrial equipment, before January 2012.

Compulsory labeling of household appliances and industrial equipment will apply from January 2013; and office and commercial equipment, materials and spare parts, from January 2015.

Regarding measures for energy efficiency and conservance in industrial production, the Law states that producers, processors and subcontract producers, must, based on energy consumption standards and technical regulations, select and apply technological and managerial measures to save energy, such as modernizing production and processing lines; replacing equipment with backward technologies and low output; and taking technical measures to reduce energy loss in electricity and heating systems.  

The Law requires the elimination of equipment with output below the minimum level according to the list and roadmap issued by the Prime Minister and disallows manufacture or import of such equipment.

Incentives for energy efficiency and conservance are listed in Article 41 of the Law. Projects promoting energy saving will be eligible for financial support from the national program on energy efficiency and conservance.

Organizations and individuals that manufacture energy-saving products and invest in production lines or expand production with energy-saving technologies are entitled to tax incentives and concessional loans.

Equipment, components and supplies for research to develop energy-saving technologies and products, fuel-saving vehicles and those using liquefied gas, natural gas, electricity and mixed fuels and bio-fuels which are domestically unavailable and listed by the Government are entitled to import duty exemption or reduction.

According to the Energy Conservance Office, the Ministry of Industry and Trade is collaborating with relevant ministries and sectors in finalizing two draft decrees to detail a number of articles of the Law, and provide for the punishment of administrative violations related to energy use; and two prime ministerial decisions on the roadmap for energy labeling and application of the minimum energy output level to energy-consuming equipment.

Some circulars and documents guiding the Law are also expected to be issued in the first quarter of 2011.-


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