Vietnam Issues Directive to Strengthen Energy Efficiency and Accelerate Energy Transition
Vietnam has issued a new Prime Ministerial directive setting out a comprehensive programme to strengthen energy efficiency, manage supply risks and accelerate the transition to cleaner energy and electric transport. The directive responds to ongoing volatility in global energy markets and outlines clear targets to 2030, alongside detailed responsibilities for ministries, local authorities, state-owned enterprises and businesses. The full text of the directive was published by the Ministry of Industry and Trade.
The government frames energy efficiency as a central policy tool to reduce exposure to disrupted oil, gas and coal supplies, lower production costs and support long-term economic competitiveness. The directive links these measures to national energy security and sustainable development, with particular emphasis on reducing dependence on imported fuels and managing demand more effectively.
National targets for energy savings and electric transport
The directive sets quantified objectives to be achieved by 2030. These include reducing energy intensity per unit of GDP by 1–1.5% each year and achieving electricity savings of at least 3% annually among designated large energy users. Losses in power transmission and distribution are to be reduced to 5.8% across the national system.
All large energy-consuming facilities are required to conduct regular energy audits and apply formal energy management systems. In the transport sector, the government aims for at least 50% of public transport vehicles in cities to transition to electric power, supported by expanded charging infrastructure and updated technical standards.
Responsibilities across ministries and local authorities
Ministries and provincial governments are instructed to integrate energy-saving objectives into future strategies, plans and legal instruments. Energy efficiency is to be treated as a core response to supply pressures, particularly during periods of global market instability. Priority sectors include steel, cement, chemicals, textiles, food processing and other energy-intensive industries.
Local authorities must develop and implement energy efficiency plans by April 2026, strengthen inspections of public offices and businesses, and update urban planning requirements to include charging infrastructure. Provinces and cities are also tasked with issuing incentives for electric buses, taxis and rooftop solar systems adapted to local conditions.
Role of the Ministry of Industry and Trade
The Ministry of Industry and Trade is assigned a central coordinating role, including monitoring global energy market developments and advising the government on timely policy responses. By mid-2026, the ministry is expected to complete updates to energy efficiency standards, expand mandatory energy labelling and strengthen enforcement among major energy users.
Other tasks include promoting energy service companies, piloting new efficiency investment models, phasing out low-efficiency incandescent lighting and setting safety and performance standards for charging equipment. The ministry will also lead work on expanding the use of E10 biofuel, with the aim of reducing mineral petrol consumption by 10%.
Buildings, finance and technology measures
The Ministry of Construction is required to update building energy efficiency codes and promote green buildings, while encouraging the integration of charging facilities into urban developments and parking areas. These measures complement wider transport decarbonisation efforts, including initiatives linked to smart and low-emission infrastructure, such as those outlined in Vietnam’s cooperation on smart, green ports and aviation.
Financial incentives are also a key part of the directive. The Ministry of Finance is tasked with developing a national fund to promote energy efficiency and issuing preferential financial mechanisms for efficiency projects and electric vehicles by mid-2026. These are intended to mobilise private investment alongside public spending.
State-owned enterprises and system efficiency
Vietnam Electricity is instructed to expand demand-side management programmes, reduce grid losses and develop a smarter, more resilient power system capable of secure regional interconnection. Major energy producers, including the national oil, gas and coal groups, are directed to cut losses across extraction, processing and transport, while improving recovery and reuse of energy resources.
The directive also encourages the use of battery energy storage systems, rooftop solar for self-consumption and digital tools for energy management. These measures align with broader efforts to modernise infrastructure and data systems, similar to initiatives supporting resilient digital networks such as Vietnam’s IPv6-only programme.
Implementation and reporting
The Ministry of Industry and Trade will oversee implementation, monitor progress and report regularly to the Prime Minister. Ministries and local governments are required to develop detailed action plans within their areas of responsibility and report any implementation challenges for central review.
Together, the measures set out in the directive establish a structured policy framework linking energy efficiency, transport electrification and technological innovation. They also reinforce Vietnam’s broader engagement with advanced technologies and international cooperation, including emerging areas such as those discussed in Vietnam–EU collaboration on artificial intelligence, which may support smarter energy management in the future.
