Page 8 - AW MayJune 19

WORLD NEWS

P4G Partnership Identifies Water and

Energy Savings in Vietnam

Since establishing the partnership, a number of activities
have been conducted to support the overall objective of
developing a blended finance model, including:
• Develop a framework and contents for the study;
• Perform desk review on Vietnamese water sector;
• Carry out data collection and interviews with officials
and financial experts from both the governmental
new report by the P4G Partnership for Blended and private sectors on opportunities and challenges
A Finance on Water demonstrated the value of market- in the water sector in Vietnam, existing initiatives,
driven solutions to reducing water leakage and energy funding schemes, etc.;
consumption among Vietnam’s water supply companies. • Perform data analysis and desk study for developing
The report found these companies can use conventional the blended finance model; •
financing to recoup their investment in water pressure Perform assessment of saving potential in the
technology in five years. representative water networks in Vietnam;
In Vietnam, the rapid urbanization and industrialization • Organize workshops with relevant stakeholders for
in the recent years have led to the significant increase in discussing the initial findings and potential ways
daily water consumption. In order to meet this increasing forward;
water demand over time, an expansion of water supply • Active participation in the P4G Summit;
network is required. Vietnam has a rate of NRW of around • Prepare the study report.
30% in 2009, and the Government of Vietnam has an Based on these activities, the partnership has made
ambitious target to reduce NRW to 15% by the year 2025 the following conclusions:
(Geospartial World, 2013). • Many water utilities in Vietnam struggle to finance
There is a number of barriers for water utilities to reduce large investments following the equitization process,
NRW including technical, institutional, and financial especially as sovereign guarantee of soft loans is not
barriers. Given an existing lack of financial resources for viable for many utilities;
WASH services as mentioned above, investments from • There are significant opportunities to reduce
private sector, especially in water infrastructure, are clearly energy consumption and water leakage in many
needed. However, the existing private investment in water water networks based on advanced pressure
sector in Vietnam is still limited due to the low water tariffs management with relatively limited investments;
that discourage the involvement of private sector. • The value of water and energy savings is sufficient to
The Asia Society for Social Improvement and repay the needed investments over a 5- year time
Sustainable Transformation (ASSIST), the Vietnam Water horizon in networks with different sizes, thereby the
Supply and Sewerage Association (VWSA), Investment public support is not needed;
Fund for Developing Countries (IFU), and Grundfos have • However, when technical conditions do not allow for
expressed interest to collaborate through a partnership, pressure management and larger investments are
and have successfully applied for an opportunity with needed for installation of new piping etc., there is no
Partnering for Green Growth and the Global Goals (P4G) business case without some level of grant support;
for financial support to develop a blended finance model • Improving pressure management does not need
towards reducing NRW and energy consumption in water large capital investments, which calls for a bundling
distribution networks in Vietnam. mechanism in order to attract large equity investors
This blended finance model, where both public and and keep the administrative burden down in case
private investments are part of the financial package, of grant support. AW
need to be advanced in the coming years.

6 MAY/JUNE 2019 Asian Water