Fearing that the investment would lead to the higher production costs, Vietnamese enterprises still hesitate to join the programme on labeling products as energy saving products.

The Ministry of Industry and Trade is running the project on barrier removal to the cost-effective development and implementation of energy efficiency standards and labeling – BRESL – funded by the Global Environment Facility in Vietnam through the United Nation’s Development Programme.

The programme on energy saving labeling for energy saving products in 2012 has been kicked off, under which enterprises would get the support in making files, registering the labeling programme, in training for data storing, and get the technical support, guidance in popularizing energy saving products.

Since 2013, the group of consumer goods, industrial equipments will have to be labeled as energy saving products in accordance with the regulations of the Ministry of Industry and Trade.

In the last three years, MOIT has been running a pilot programme on labeling products on the spontaneous basis for some kinds of products such as neon lamps, compact lamps, ballast and electric fans.

Le Tuan Phong, Deputy Head of the Energy Department under the Ministry of Industry and Trade MOIT, said that the labeling would not only help considers easily choose products suitable to their demand, but also could serve as the technical barriers to prevent backward products and equipments with low energy efficiency. This would also help put a pressure on manufacturers, forcing them to make out the products with high energy efficiency.

However, despite the big advantages, it is still very difficult to apply the labeling programme. A lot of businesses do not think that labeling is a competitive edge for them. Therefore, they are not determined to renovate technologies and improve the quality of the products, so as to be eligible for labeling. 

In 2009, VIHEM, an electric equipment manufacturer, labeled products on a spontaneous for four its electrical engine products. However, the company has said that in the last two years, the products have been selling well not because of the labeling.

Tran Quang Tam, Deputy General Director of VIHEM, said that with more than 200 engine products subject to be labeling, the company would have to spend much money on different production phases, from the input materials to the engine design. The process would lead to the higher production costs, which would make it difficult to boost sales.

He has expressed his worries that the company may not fulfill the work on schedule, as the products will have to be labeled by 2013.

Regarding the investment, Nguyen Huy Hung, Deputy Marketing Director of the Dien Quang Company, a lamp manufacturer, said that the company has invested over 100 billion dong to renovate the production lines with new technologies, so as to satisfy the requirements on safety, and environment protection. To date, all the compact lamp products of Dien Quang have been labeled as energy saving products.

A lot of enterprises have expressed their will to join the process of labeling. However, they said that they still lack information about that, especially about the inspection fee, the investment capital and the production technology.

According to Dr Nguyen Van Khai from the Vietnam Institute of Natural Sciences, enterprises need to apply some measures to ensure the success of the programme.

First, enterprises need to access different capital sources in order to start technique renovation programmes. After considering the projects by enterprises, commercial banks would make decision on whether to fund the programmes.

Second, Khai said that it is necessary to set up a market which operates in accordance with the supply-demand rules, which would encourage enterprises to use advanced technologies and encourage consumers to use energy saving products.