Kinhtedothi - Developing a centralized carbon market, operating according to market principles under the close management and supervision of the State, ensuring the principles of publicity, transparency, safety and efficiency.
Vietnam aims to achieve net zero emissions by 2050
Deputy Prime Minister Tran Hong Ha has just signed Decision No. 232/QD-TTg dated January 24, 2025 approving the Project on Establishing and Developing the Carbon Market in Vietnam.
The overall objective of the Project is to develop a carbon market in Vietnam, contributing to the implementation of the greenhouse gas emission reduction target committed in the Nationally Determined Contribution (NDC) at low costs for businesses and society, creating new financial flows for greenhouse gas emission reduction activities, promoting green transformation, developing low-emission technologies, contributing to improving the competitiveness of Vietnamese enterprises domestically and in the world market, developing a low-carbon economy and proactively responding to climate change, towards achieving net emissions of "0" by 2050.
The project aims to gradually build and complete the legal framework for the exchange of greenhouse gas emission quotas, carbon credits and the mechanism for exchanging and offsetting carbon credits by June 2025, ensuring the legal basis for the pilot implementation of a carbon trading floor; building infrastructure to serve the organization and operation of the carbon market.
The capacity of state management agencies to manage and organize the operation of the carbon market, the capacity and awareness of enterprises, organizations and individuals to meet the readiness to participate in the carbon market.
According to the Project, goods on the carbon market include 02 types:
1- Greenhouse gas emission quotas are allocated to establishments in the List of sectors and establishments emitting greenhouse gases that must conduct greenhouse gas inventories issued by the Prime Minister in a free-of-charge manner and by auction.
2- Carbon credits are confirmed to be traded on the market, including:
- Carbon credits obtained from programs and projects under the domestic carbon credit exchange and offset mechanism in accordance with the provisions of law;
- Carbon credits obtained from programs and projects under the international carbon credit exchange and offset mechanism: Carbon credits obtained from the Clean Development Mechanism (CDM); Carbon credits obtained from the Joint Crediting Mechanism (JCM); Carbon credits obtained under the Mechanism under Article 6 of the Paris Agreement.
Trading method
Trading of greenhouse gas emission quotas and carbon credits is carried out on domestic carbon exchanges.
Hanoi Stock Exchange builds and provides domestic carbon trading floor services according to professional requirements on market organization and management and technical conditions and standards presided over by the Ministry of Natural Resources and Environment, in coordination with the Ministry of Finance and relevant ministries, branches and agencies.
The organization of transactions on the carbon market is carried out in a centralized manner on the carbon exchange.
Greenhouse gas emission quotas and carbon credits certified by the Ministry of Natural Resources and Environment to be traded on the exchange will be assigned a domestic code to serve the transaction; the code assigned is unique and non-duplicated. When participating in transactions on the carbon market in Vietnam, the subject must have a depository account for trading greenhouse gas emission quotas or a depository account for trading carbon credits. The registration and issuance of codes for greenhouse gas emission quotas and carbon credits are carried out centrally to ensure that data is unified, synchronized and meets management and monitoring requirements.
Vietnam Securities Depository and Clearing Corporation provides depository and transaction settlement services according to professional requirements on organization, market management and technical conditions and standards presided over by the Ministry of Natural Resources and Environment, in coordination with the Ministry of Finance and relevant ministries, branches and agencies.
The transaction settlement will be automatically carried out by the system based on the transaction results sent by the Hanoi Stock Exchange, ensuring the principle that the transfer of goods is carried out simultaneously with the payment at the payment bank. The payment for transactions on the carbon exchange is carried out by commercial banks qualified to provide payment services for greenhouse gas emission quota and carbon credit transactions.
The Ministry of Natural Resources and Environment shall preside over and coordinate with the Ministry of Finance, the Ministry of Agriculture and Rural Development, the Ministry of Construction, the Ministry of Industry and Trade, the Ministry of Transport and relevant ministries, branches and agencies to organize the operation of the domestic carbon market, ensuring that it does not develop freely and spontaneously, causing loss of State resources and assets, affecting national security and social order.
Roadmap for carbon market implementation
Pilot implementation phase from 2025 to the end of 2028
- Pilot implementation of carbon market nationwide. Transfer of carbon credits and greenhouse gas emission reduction results to foreign and international partners is studied, specifically regulated in legal documents and considered and decided by competent authorities.
- The entire greenhouse gas emission quota is studied and considered for free allocation to greenhouse gas emission facilities in a number of large emission sectors.
- Carbon credits are confirmed for trading on the carbon exchange, including carbon credits obtained from: (i) Programs and projects under the domestic carbon credit exchange and offset mechanism; (ii) Clean Development Mechanism (CDM); (iii) Joint Credit Mechanism (JCM); (iv) Mechanism under Article 6 of the Paris Agreement.
- The ratio of carbon credits used to offset greenhouse gas emissions to the total greenhouse gas emission quota allocated to the facility is prescribed by the Government.
- The subjects participating in transactions on the carbon exchange are: (i) large greenhouse gas emission facilities in the List of sectors and greenhouse gas emission facilities that must conduct greenhouse gas inventories issued by the Prime Minister and are allocated greenhouse gas emission quotas; (ii) organizations and individuals eligible to participate in buying and selling carbon credits on the carbon exchange.
Official operation phase from 2029
- Carbon market is officially operated nationwide.
- The sectors and facilities allocated greenhouse gas emission quotas are studied and considered for expansion according to the roadmap.
- Greenhouse gas emission quotas are studied and considered for free allocation and auction allocation. The detailed rates for free allocation and auction of greenhouse gas emission quotas will be proposed during the pilot implementation phase and after having full information and data on granted greenhouse gas emission quotas and transaction volume.
- Consider adding additional types of certified carbon credits to trade on the carbon exchange.
- The ratio of carbon credits used to offset emissions to the total greenhouse gas emission quota allocated to the facility is prescribed by the Government.
- Consider expanding the subjects allowed to participate in carbon credit transactions on the carbon exchange (adjusting the conditions for organizations and individuals allowed to participate in transactions on the carbon exchange)...
5 groups of tasks and solutions
The project proposes 5 groups of tasks and solutions for implementation: Group of tasks and solutions on goods in the carbon market; Group of tasks and solutions on subjects participating in the carbon market; Group of tasks and solutions on the national registration system and carbon trading floor; Group of tasks and solutions on organizing and operating the carbon market; Group of tasks and solutions on raising awareness and enhancing capacity.
Source: https://kinhtedothi.vn/phe-duyet-de-an-thanh-lap-va-phat-trien-thi-truong-cac-bon-tai-viet-nam.html
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