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Addressing Climate Change in Transport Addressing Climate Change in Transport Volume 1: Pathway to Low-Carbon Transport Vietnam Transport Knowledge Series Supported by AUSTRALIA–WORLD BANK GROUP STRATEGIC PARTNERSHIP IN VIETNAM and NDC PARTNERSHIP SUPPORT FACILITY Addressing Climate Change in Transport Volume 1: Pathway to Low-Carbon Transport Jung Eun Oh, Maria Cordeiro, John Allen Rogers, Khanh Nguyen Daniel Bongardt, Ly Tuyet Dang, Vu Anh Tuan FINAL REPORT September 2019 © 2019 The World Bank and Deutsche Gesellschaft für Internationale Zusammenarbeit GmbH 1818 H Street NW, Washington DC 20433 Telephone: 202-473-1000; Internet: www.worldbank.org This work is a product of the staff of The World Bank and the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) with external contributions. The findings, interpretations, and conclusions expressed in this work do not necessarily reflect the views of The World Bank and its Board of Executive Directors. The World Bank or GIZ does not guarantee the accuracy or completeness of information in this document, and cannot be held responsible for any errors, omissions or losses, which emerge from its use. The boundaries, colors, denominations and other information as shown on any map in this work do not imply any judgment on the part of The World Bank or GIZ concerning the legal status of any territory or the endorsement or acceptance of such boundaries. Nothing herein shall constitute or be considered to be a limitation upon or waiver of the privileges and immunities of The World Bank, all of which are specifically reserved. All queries on rights and licenses should be addressed to the Publishing and Knowledge Division, The World Bank, 1818 H Street NW, Washington DC 20433, USA; fax: 202-522-2625; email: [email protected]. Cover photo: Woman waiting on her motorbike in Hanoi, Vietnam. Credit: Beboy – stock.adobe.com. Contents Figures and Tables ............................................................................................................vii Forewords .........................................................................................................................xi World Bank Group..................................................................................................................................xi Embassy of the Federal Republic of Germany to the Socialist Republic of Vietnam........................... xiii Acknowledgments ............................................................................................................xv About the Authors ..........................................................................................................xvii Abbreviations and Acronyms ...........................................................................................xix Executive Summary ......................................................................................................... 23 Chapter 1: Introduction.................................................................................................... 31 Background and Objectives.................................................................................................................. 31 Transport Sector Development in Vietnam.......................................................................................... 33 Chapter 2: Business-As-Usual Reference Scenario ............................................................ 41 Growth Projection in the Transport Sector under BAU........................................................................ 41 GHG Emissions Results under BAU....................................................................................................... 44 Chapter 3: Scenario 1—With Domestic Resources Only.................................................... 49 Emissions Mitigation Measures under Scenario 1 ............................................................................... 49 GHG Emissions Results under Scenario 1............................................................................................. 52 Marginal Abatement Cost under Scenario 1 ........................................................................................ 55 Conclusions .......................................................................................................................................... 57 Chapter 4: Scenario 2—Increasing Ambition with International Support and Active Engagement of the Private Sector ................................................................................... 59 Emissions Mitigation Measures under Scenario 2 ............................................................................... 59 GHG Emissions Results under Scenario 2............................................................................................. 61 Marginal Abatement Cost under Scenario 2 ........................................................................................ 65 Conclusions .......................................................................................................................................... 67 Chapter 5: Scenario 3—Pushing Transformation of the Sector with Larger Support from International Resources and Strong Private Sector Engagement ...................................... 69 Emissions Mitigation Measures under Scenario 3 ............................................................................... 69 GHG Emissions Results under Scenario 3............................................................................................. 72 Marginal Abatement Cost under Scenario 3 ........................................................................................ 75 Conclusions .......................................................................................................................................... 77 Chapter 6: Cost of Implementation .................................................................................. 79 Marginal Abatement Cost Methodology.............................................................................................. 79 Marginal Abatement Cost Results for Each Measure........................................................................... 80 Promotion of biofuel......................................................................................................................... 80 Promotion of electric motorbikes ..................................................................................................... 81 Page | v New vehicle fuel economy standards ............................................................................................... 83 Expansion of bus systems ................................................................................................................. 85 Promotion of electric buses .............................................................................................................. 87 Expansion of the BRT system............................................................................................................ 88 Deployment of metro systems.......................................................................................................... 90 Promotion of electric cars................................................................................................................. 91 Freight modal shift from road to inland waterway and to coastal shipping .................................... 94 Modal shift from road to railway ..................................................................................................... 97 Introduction of CNG buses................................................................................................................ 99 Improvement of truck load factor .................................................................................................. 100 Marginal Abatement Cost Curve ........................................................................................................ 101 Chapter 7: Conclusions and Policy Recommendations.....................................................107 Appendices.....................................................................................................................111 A. GHG Emissions Inventory............................................................................................................... 111 B. Scenario Formulation ..................................................................................................................... 112 C. Modeling Methodology.................................................................................................................. 113 D. Key Data and Assumptions ............................................................................................................ 120 E. MACC Methodology ....................................................................................................................... 124 F. Coordination of Technical Assistance............................................................................................. 129 Page | vi Figures and Tables FIGURES Figure E.1. GHG Emissions from Transport per Capita and per GDP (2014–2030) .............................. 23 Figure E.2. CO2 Emissions Projection by Transport Subsectors under BAU Scenario........................... 25 Figure E.3. Reduction of CO2 Emissions by Each Mitigation Option under Scenario 1......................... 26 Figure E.4. Reduction of CO2 Emissions by Each Mitigation Option under Scenario 2......................... 27 Figure E.5. Reduction of
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