Decision No. 177/2007/QĐ-TTg on approving the "Biofuel Development Plan until 2015, with a vision to 2025"

Pursuant to …;

Regarding the approval of the "Biofuel Development Plan until 2015, with a vision to 2025"

_________________________

PRIME MINISTER

Pursuant to the Law on Organization of the Government dated December 25, 2001;

Considering the proposal of the Minister of Industry and Trade,

DECISION:

Article 1. Approve the "Biofuel Development Plan until 2015, with a vision to 2025" (hereinafter referred to as the Plan) with the main contents as follows:

I. OBJECTIVES

1. General objectives:

Developing biofuels, a new form of renewable energy, to replace part of traditional fossil fuels, contributing to ensuring energy security and protecting the environment.

2. Specific objectives for each stage:

a. Stage up to 2010:

- Establishing a system of mechanisms, policies, and regulatory legal documents to create a legal framework to attract investment, encourage industrial-scale production and use of biofuels. Enhancing public awareness of the important role and significant benefits of biofuels;

- Establishing a roadmap for using biofuels to replace part of the fossil fuels currently used in the transportation sector, other industries, and pilot distribution models of biofuels in some provinces and cities;

- Researching, accessing, and mastering production technologies of biofuels from biomass, suitable blending technologies, and solving issues related to improving efficiency in converting biomass into fuel;

- Planning and developing regions for raw materials to produce ethanol, vegetable oils, animal fats (sugarcane, cassava, corn, oilseed crops, waste animal fats, etc.) for biofuel production;

- Training human resources to meet initial development needs of biofuels;

- By 2010, building and developing experimental production and usage models of biofuels at a scale of 100 thousand tons of E5 and 50 thousand tons of B5 per year, ensuring a supply of 0.4% of the national gasoline and diesel demand;

- Accessing and mastering technologies for producing high-yield crop varieties for biofuel production.

b. Stage 2011-2015:

- Researching, mastering, and producing materials and additives for biofuel production; - Developing wide-scale production and usage of biofuels to replace part of traditional fossil fuels. Expanding the scale of biofuel production facilities and distribution networks for transportation and other industrial purposes;

- Developing raw material regions according to planning, introducing high-yield, disease-resistant crop varieties into large-scale production to ensure sufficient biomass feedstock for biofuel conversion processes;

- Successfully applying modern fermentation technology to diversify biomass sources for biofuel conversion processes;

- Building and developing biofuel production and usage facilities nationwide. By 2015, ethanol and vegetable oil production will reach 250 thousand tons (enabling 5 million tons of E5 and B5 blends), meeting 1% of the national gasoline and diesel demand;

- Training a specialized team of officials in key areas related to biofuel production processes and training a broad workforce of technical workers to meet human resource needs for biofuel development.

c. Vision to 2025:

Domestic biofuel production technology will reach advanced levels globally. Ethanol and vegetable oil production will reach 1.8 million tons, meeting about 5% of the national gasoline and diesel demand.

1. Creating and developing high technology in agriculture

1. Scientific research and technological development (R&D), implementing trial production (P) to serve biofuel development:

- Researching, establishing, and promulgating mechanisms, policies, and regulatory legal systems related to scientific research, technological development, technology transfer, production, and use of biofuels, including policies to encourage investment; mechanisms to promote scientific research, technology transfer, and production development; technical standards and regulations, implementation schedules (TCVN standards, technical regulations related to E5, B5 production and use, mandatory environmental regulations and implementation schedules for users encouraging widespread use of biofuels);

- Accessing and mastering blending technologies for gasoline, condensate, naphtha, diesel, and petroleum diesel with ethanol, biodiesel, and additives to produce E5 (95% conventional petroleum gasoline and 5% ethanol) and B5 diesel (95% conventional petroleum diesel and 5% biodiesel) and operating blending facilities with a capacity of 100 thousand tons of E5 and 50 thousand tons of B5 per year. Developing a distribution network and consumption market across the country, with focal points being major cities such as Ho Chi Minh City, Hanoi, Da Nang, etc.;

- Accessing and applying modern ethanol production technologies from various biomass sources: producing and using highly effective enzymes for raw material conversion, antibiotic preparations against contaminants, multi-mechanism, high-efficiency microorganisms, continuous fermentation systems saving energy (yeast recycling, cooking water reuse, excess steam utilization), etc. Mastering modern, high-efficiency ethanol production technologies meeting biofuel standards. Developing ethanol production facilities from medium to large scales and integrating them to ensure sufficient ethanol for E5 blending needs;

- Conducting scientific research, technological development, and organizing production and consumption of biodiesel from vegetable oils and animal fats meeting standards for blending with petroleum diesel to produce B5 products. Developing biodiesel production facilities according to appropriate scales based on regions and raw material sources to ensure sufficient biodiesel for B5 blending.

- Planning and developing raw material regions for producing ethanol, oil, animal and plant fats (sugarcane, cassava, corn, oilseed crops, waste animal fat, etc.) towards maximizing the current land fund, while effectively utilizing the land of each locality, leveraging the advantages of each raw material region. Selecting and breeding sugarcane, cassava, corn, rice, and oilseed crop varieties with high yields to reach world-standard levels, suitable for planned lands, particularly poor and degraded lands unsuitable for food production;

- Conducting scientific research, developing technology, and implementing the production of necessary additives and chemicals to blend biofuels with traditional fossil fuels, ensuring fuel quality requirements and environmental safety;

2. Establishing and developing the biofuel production industry:

- Establishing and encouraging businesses from all economic sectors to invest in activities related to research, technology transfer, reception, and application of technology in biofuel production; effectively applying new technological advancements to produce, trade, and service biofuel products;

- Strengthening and developing the biofuel production industry, creating a transparent and favorable market to promote business investment in biofuel production, trading, and service projects;

3. Building capacity to serve biofuel development:

a. Training human resources:

- Short-term training lasting from 6 to 12 months to enhance the professional expertise of science and technology staff in countries with advanced biofuel production industries;

- Domestic training of engineers specializing in biofuel production technology from biomass production to conversion into fuel according to the project's contents;

- Training highly skilled technical workers in biofuel production technology to implement project contents at enterprises and localities;

- Enhancing knowledge and improving state management capabilities for central and sectoral management officials and businesses regarding the development and application of biofuels;

b. Building physical infrastructure and modernizing machinery and equipment:

- Deep investment to upgrade systems of scientific research and technology development institutions in the biofuel field; supplementing advanced machinery and equipment and modernizing facilities and techniques of existing laboratories to enhance professional capabilities and expertise to access and receive technology transfers on biofuel production from biomass to commercial products;

- Investing in and putting into operation some advanced laboratories, ensuring sufficient capacity to effectively serve research subjects on raw materials, production technology, and blending, prioritizing technical-oriented research to quickly produce products with potential for large-scale industrial production;

- Constructing, networking, and operating a national database and information system on biofuels to provide and share timely and comprehensive basic and latest information on biofuel production equipment and technology for relevant units and individuals;

4. International cooperation:

- Proactively receiving, mastering, and transferring technological advancements and scientific achievements in the global biofuel production field to rapidly, strongly, and sustainably develop the biofuel production industry in Vietnam;

- Implementing approximately 20 international cooperation projects with foreign organizations, individual scientists, and technologists to develop research, production, and use of biofuels in our country;

III. SOME KEY SOLUTIONS

1. Promoting the application of research results in practical production, encouraging technology transfer, and creating a favorable investment environment for biofuel production development:

- Vigorously implementing basic research topics, applied research, R&D projects to absorb and master biofuel production technology, essential chemical additives, pilot production projects (P projects), international cooperation projects, technology transfer projects, and industrial-scale biofuel production projects;

- Encouraging the application of research and development results in production, promoting domestic technology transfer activities, and importing advanced biofuel production technologies and chemical additives from developed countries to promote biofuel production and consumption;

- Creating a transparent and favorable market for biofuel development, promoting the establishment of businesses from all economic sectors and encouraging their investment in biofuel production. The State will offer preferential policies on credit loans, taxes, land use rights, etc., for businesses investing in biofuel production development;

2. Increasing investment and diversifying capital sources to effectively implement the project's contents:

- The total funding for implementing the project's contents is determined based on the approved budgets of specific projects, topics, and component tasks by competent authorities. Annually, the State increases the level of investment capital from the budget to implement the project's contents. Strengthening and diversifying investment capital from domestic and foreign businesses, organizations, individuals, foreign economic funds (ODA, FDI, etc.), and other international cooperation funds to develop biofuels in the country;

- The total state budget capital allocated for the implementation of the Project's contents over nine years (2007 - 2015) is estimated at approximately 259.2 billion VND (on average 28.8 billion VND per year). This capital will be used for the performance of basic research tasks, applied research, scientific research and technological development, improvement and technological innovation research aimed at increasing production volume, quality, and competitiveness of biofuels, trial production of products, supporting technology transfer projects for industrial-scale biofuel product manufacturing; enhancing technical infrastructure, machinery, and equipment; human resource training; international cooperation, and other related contents under the Project.

- Investment capital for developing the biofuel production industry shall be borne by enterprises.

3. Strengthening the construction of technical infrastructure and human resource training to meet the needs of biofuel development:

- Vigorously promote the construction of technical infrastructure, enhance and modernize machinery and equipment for laboratories and institutions engaged in biofuel research, application, and development.

- Actively implement planning and apply comprehensive solutions to develop biomass raw material regions towards sustainable closed-loop development from seedling stage to cultivation techniques, organization of biomass production supply for biofuel manufacturing facilities, while planning new biofuel production facilities oriented towards processing, trading, and service provision of high-quality products with strong market competitiveness to meet market requirements.

- Vigorously promote the training of highly qualified human resources in technology in the biofuel production industry, including supplementary training, new training, upgrading, and enhancing scientific and technological capabilities at bachelor's, engineering technology, and technician levels; improving management capacity to meet the sustainable development needs of the biofuel production industry in Vietnam.

4. Improving the system of mechanisms, policies, and regulatory legal documents to develop biofuels:

- Reform mechanisms and policies on taxation, preferential loans, and land use to support, encourage, and create favorable conditions for domestic and foreign enterprises and individuals to invest in biofuel production in Vietnam. During the period of 2007 - 2015, investment in biofuel production was classified as a priority investment sector. Enterprises investing in biofuel production are exempted or granted tax reductions on income derived from biofuel products according to Decree No. 24/2007/NĐ-CP dated February 14, 2007, detailing the implementation of the Law on Corporate Income Tax. Biofuel manufacturing enterprises enjoy maximum lease and land use benefits for a period of 20 years. Raw materials, spare parts, machinery, and equipment serving scientific research and technological development for biofuel production are exempted from import taxes. Raw materials, spare parts, machinery, and equipment serving biofuel production enjoy the lowest import tax rates.

- During the establishment of national technical standards and regulations for various types of raw materials, additives, and biofuel products, encourage enterprises to self-declare their own standards based on referencing standards from G7 countries.

- Vigorously promote the formulation and issuance of mechanisms and policies to attract investment and encourage talent participation in scientific research, technological development, production, and consumption of biofuels sustainably. During the period of 2007 - 2015, newly graduated students recruited into biofuel manufacturing facilities and research agencies are prioritized for enrollment in domestic and international advanced vocational training programs.

- Encourage and support the research and breeding of microbial strains, new industrial crop varieties (including genetically modified strains and varieties), and the completion of industrial-scale cultivation procedures to produce high-yield and high-quality raw materials that meet the development requirements of the biofuel production industry in our country.

- Vigorously enforce intellectual property rights regulations strictly and comprehensively to protect copyright and industrial property rights for microbial strains, plant varieties, technological processes, machinery, and equipment of biofuel production technology.

5. Expand and strengthen international cooperation to learn experiences in biofuel development:

- Enhance bilateral cooperation, expand multilateral cooperation with countries having developed biofuel industries, and with foreign organizations and individuals with substantial potential to learn experiences in biofuel development.

- Proactively build and implement international cooperation programs, topics, and projects to maximize assistance in experience, intelligence, financial sponsorship, equipment provision, and investment attraction to develop biofuel production and consumption in our country.

6. Raise public awareness about biofuel development:

Vigorously promote publicity and dissemination of knowledge to make people understand the important role and significant economic, social, and environmental benefits of biofuels in sustainable development. Widespread promotion of the development and use of biofuel markets in our country.

IV. IMPLEMENTATION

1. Ministry of Industry and Trade:

- Take the lead and coordinate with relevant ministries, sectors, localities, and organizations to effectively implement the Project's contents in accordance with the schedule, report annually to the Prime Minister; take the lead in organizing a summary conference at the end of 2010 to evaluate the results of the first three years of Project implementation to draw lessons learned and serve as a basis for implementation during the 2011 - 2015 period.

- To take the lead in establishing the long-term state budget capital plan and annual plans to implement the contents of the Project, and send them to the Ministries of Planning and Investment, Finance for consolidation and submission to the Prime Minister for approval.

- To take the lead in developing the list of investment incentives in the field of biofuel development and the mechanism for applying preferential policies.

- To take the lead and coordinate with the Ministry of Foreign Affairs and the Ministry of Science and Technology to organize the implementation of international cooperation content on biofuel development.

- To take the lead and coordinate with the People's Committees of provinces and centrally governed cities to establish the supply and distribution system for biofuel products.

- To take the lead and coordinate with relevant ministries, sectors, and localities to organize propaganda and dissemination of knowledge to the community about the role and benefits of biofuels for sustainable national development.

- The Minister of Industry and Trade shall establish an inter-ministerial steering committee to organize the implementation of the "Biofuel Development Project until 2015, vision to 2025" with the leadership of the Ministry of Industry and Trade serving as the Chairman. The composition and operational regulations of the inter-ministerial steering committee and its office shall be decided by the Minister of Industry and Trade.

2. The Ministry of Agriculture and Rural Development:

- To take the lead and coordinate with the Ministry of Industry and Trade and the Ministry of Planning and Investment to develop the planning for the development of raw material regions for the biofuel production industry.

- To take the lead and coordinate with the Ministry of Planning and Investment and the Ministry of Finance to develop and implement preferential policies and support for biomass raw material production for biofuel production.

3. The Ministry of Science and Technology:

- Based on their own functions, tasks, authorities, and scope of state management, they are responsible for coordinating with the Ministry of Industry and Trade to effectively implement the contents related to scientific research and technological development in biofuel production in the Project.

- To take the lead and coordinate with the Ministry of Industry and Trade and relevant ministries and sectors to build and issue or submit to competent authorities for issuance mechanisms and preferential policies for scientific research and technological development in biofuel production; related documents on intellectual property (industrial property rights protection, copyright), technical standards and specifications related to this field.

4. The Ministries of Planning and Investment, Finance:

- To balance, allocate, and guide the use of annual and long-term capital plans to effectively and timely implement the contents and tasks of the Project.

- To take the lead and coordinate with the Ministry of Industry and Trade and relevant ministries and sectors to build and issue or submit to competent authorities for issuance preferential tax mechanisms; investment incentives and the mechanism for applying preferential policies for biofuel production projects.

5. The Ministry of Education and Training:

- To take the lead and coordinate with the Ministry of Industry and Trade and relevant ministries and sectors to organize human resource training to meet the needs of biofuel development.

6. Ministries, sectors, localities, enterprises, organizations, and individuals:

who wish to participate in implementing the contents and tasks of the Project shall register with the Ministry of Industry and Trade for consideration and resolution.

Article 2. This Decision takes effect fifteen days from the date of publication in the Official Gazette.

Article 3. The Minister of Industry and Trade, ministers, heads of ministerial-level agencies, heads of government-affiliated agencies, Chairmen of provincial and centrally governed city People's Committees, and related organizations and individuals are responsible for enforcing this Decision./.