On the afternoon of August 22, Deputy Prime Minister Tran Hong Ha chaired a meeting to give opinions on completing the draft Project on developing the carbon market in Vietnam.

The entire quota is allocated free of charge.

According to the latest draft of the Carbon Market Development Project in Vietnam, the carbon market will create a new financial flow for greenhouse gas emission reduction activities, while promoting green transformation, developing low-emission technologies, developing a low-carbon economy and proactively responding to climate change, aiming to achieve net zero emissions by 2050.

The draft also clearly states that in the 2025-2028 period , the carbon market will be piloted nationwide; carbon credits will not be sold abroad; and there are no regulations on activities to connect and exchange domestic carbon credits with regional and global carbon markets.

In addition, the entire quota is allocated free of charge, without auction. Greenhouse gas emission quotas will be allocated to a number of large emission sectors.

Types of carbon credits allowed to be exchanged and traded on the market include: credits obtained from domestic credit-generating programs and projects in accordance with the law; carbon credits obtained from programs and projects under the international carbon credit exchange and offset mechanism.

The subjects participating in buying and selling on the market are large greenhouse gas emission facilities in a number of emission sectors issued by the Prime Minister that are allocated greenhouse gas emission quotas and organizations and individuals participating in buying and selling carbon credits on the trading floor.

carbon footprint.jpg
According to the Project, carbon credits will not be sold abroad during the 2025-2028 period. Illustrative photo

From 2029 , the carbon market will be officially operated nationwide. Legal and infrastructure issues will continue to be built and completed to serve the connection of the domestic carbon market with the region and the world.

Regarding greenhouse gas emission quotas, according to the draft Project, most of them will be allocated free of charge, the rest will be allocated through auction; consider adding more types of certified carbon credits for trading on the market.

Transaction facilitation organizations are entities that perform greenhouse gas emission mitigation assessments. Depending on the expected market size, they may include organizations that perform other transaction facilitation tasks.

Trading of greenhouse gas emission quotas and carbon credits is carried out on the domestic carbon credit exchange in a centralized manner on an online trading platform.

Accordingly, the Ministry of Natural Resources and Environment is the agency responsible for operating, managing, monitoring and supervising the carbon credit market. The Hanoi Stock Exchange and the Vietnam Securities Depository and Clearing Corporation will build and provide domestic carbon credit trading floor services according to the professional requirements on market organization and management and the conditions and technical standards established by the Ministry of Natural Resources and Environment.

At the meeting, issues such as operation, monitoring, connection methods, participation with domestic and international carbon markets, and prevention of speculation... were also discussed and analyzed.

Tran Hong Ha Statue.jpg
According to Deputy Prime Minister Tran Hong Ha, there needs to be flexible, creative, and innovative solutions in implementing the Carbon Market Development Project in Vietnam. Photo: VGP

The game of who is faster wins

With great potential for renewable energy and carbon markets, Deputy Prime Minister Tran Hong Ha emphasized that Vietnam will be very attractive to investors. Therefore, there needs to be flexible, creative and innovative solutions in implementing the Project to quickly approach and keep up with the world trend.

"This is a game where the fast wins, the smart ones grasp and take advantage of opportunities to move from behind, and the underdeveloped ones can rise up, join in and surpass each other," said the Deputy Prime Minister.

Therefore, he requested the Ministry of Finance to study, absorb comments, and urgently complete the draft Project not only for the carbon market but also for the organizational structure, infrastructure...

The Deputy Prime Minister also assigned the Ministry of Finance, the Ministry of Natural Resources and Environment and relevant ministries and branches to coordinate and determine the supply and demand of the domestic and international carbon market.

Along with that, building a legal framework for calculating, measuring, and determining products traded on the carbon market, such as emission quotas, carbon credits, etc., as a basis for developing a comprehensive operation plan for the domestic trading floor, as well as conditions for connecting with the international market to ensure transparency and publicity, the Deputy Prime Minister requested.

Carbon credits are currently priced at $20, if we don't collect them, we will lose money . The Ministry of Agriculture and Rural Development is also cooperating to price 1 carbon credit at $20. But in the project of 1 million hectares of high-quality rice and emission reduction, if we don't collect carbon credits, we will lose money, not profit.