Distribution Efficiency Project

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The development objectives of the Distribution Efficiency Project are to improve the performance of Vietnam's power corporations (PCs) in providing quality and reliable electricity services, and to reduce greenhouse gas emissions through demand side response and efficiency gains. There are three components to the project. The first component is system expansion and reinforcement. This component will cover construction and reinforcement of 110 kV, Medium Voltage (MV) and Low Voltage (LV) electricity distribution networks, including substations, of the PCs. These investments will help the PCs to efficiently meet load growth, address load supply constraints due to distribution system congestion, reduce losses, and improve reliability and quality of power supply. The second component is introduction of smart grid technologies in distribution. This component, which includes Clean Technology Fund (CTF) co-financing, will focus on (i) automation, through introduction of supervisory control and data acquisition systems, of electricity distribution network operations of and data collection by the PCs; and (ii) introduction of Advanced metering infrastructure (AMI) systems, including two-way communication systems, as electricity distribution smart grid technologies for key substations and consumers of selected PCs. Supporting the first stage of the roadmap for smart grid technologies for power distribution in Vietnam, the component will assist to increase efficiency, reliability and effectiveness of the PCs' systems and operations, and optimize distribution system configuration by providing real time data from both the supply and the demand side. The third component is technical assistance and capacity building. Provision of technical assistance to and capacity building of Electricity Regulatory Authority of Vietnam (ERAV) for improvement of efficiency in electricity tariffs, enhancement of efficiency of and incorporation of smart grid technologies in the grid and distribution codes, integration of renewable energy in the grid and distribution codes, development of demand response and smart grid programs, and project management and monitoring and evaluation. Building on the technical assistance and capacity building under on-going Bank projects and the Bank support to power sector reform and tariff regulation, third component will complement the investment in the previous two components through building capacity and implementing arrangements to maximize improvements in PCs' efficiency and achieve reductions in demand compared to Business as usual (BAU), to achieve project development objectives and indicators.