Dr. Le Hoang The - The Vos Ecosystem Company Limited, said that the carbon credit market is a trading system that allows the purchase and sale of greenhouse gas emission rights between business units, between organizations, between localities or between countries.

The carbon credit market is divided into two types: voluntary market and mandatory market. In which, the voluntary market is based on the commitments of countries in the United Nations Framework Convention on Climate Change (UNFCCC). The mandatory market is based on bilateral or multilateral cooperation agreements, credit buyers participate in transactions to meet social and environmental policies.

Currently, Vietnam is among the countries with the highest carbon emission growth rate in the world. However, Vietnam is also one of the countries with great potential for supplying carbon credits.

It is estimated that Vietnam’s forestry sector alone has 57 million carbon credits, equivalent to 52 million tons of CO2, that can be sold to international organizations. If we optimistically count the “golden forests and silver seas”, our country has about 5 billion carbon credits, Mr. The informed.

According to Mr. The, our country has a long terrain, not only has large reserves of carbon credits but can also develop a super type of carbon credit, called organic carbon.

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Our country's forestry sector can sell 52 million tons of CO2. Illustrative photo

This expert also believes that the time has come when the growth story cannot avoid the carbon credit story. The carbon credit market is driven by corporate climate commitments and consumer interest in mitigating climate change.

So, what is a reasonable price to sell carbon credits at?

At the end of 2023, Vietnam earned its first amount of money from selling forest carbon credits when it transferred 10.3 million tons of CO2 to the World Bank (WB) at a unit price of 5 USD/ton. After the transfer, our country earned 51.5 million USD and this amount was divided among forest owners.

Recently, a number of localities have received requests from domestic and international organizations and individuals to learn about and propose the implementation of forest carbon sequestration and storage services (forest carbon services), including measurement, reporting, appraisal, issuance and trading of forest carbon credits. Quang Nam, Son La, Lao Cai and Thanh Hoa provinces have proposed to develop and implement a pilot project on investment and trading of forest carbon credits.

The Ministry of Agriculture and Rural Development and Emergent, the administrative agency of the Reducing Emissions through Enhanced Forest Finance Alliance (LEAF), are preparing to negotiate, sign and implement the Emission Reductions Trading Agreement for the Central Highlands and South Central Coast regions according to the Letter of Intent (LoI) signed on October 31, 2021.

It is expected that our country will transfer to LEAF/Emergent 5.15 million tons of CO2 from the Central Highlands and South Central regions in the period of 2021-2025 at a price of 10 USD/carbon credit.

Dr. Le Xuan Nghia - Director of the Carbon Finance Development Consulting Institute (CODE) said that the carbon price is very "hot", CODE has negotiated a price of 30 USD/credit but also encountered difficulties with procedures so it cannot sell yet (read more)

During a recent discussion session on the socio-economic situation at the National Assembly, delegate Nguyen Quang Huan - Vice President of the Vietnam Private Entrepreneurs Association was "very excited" when Vietnam earned 51.5 million USD from carbon credit transfers, but this was in the voluntary market.

He said that if we do not urgently establish a compulsory market, we may be at a disadvantage because the current carbon price in the voluntary market is very low, only 10 USD/credit. Meanwhile, in the compulsory market it could be 40, 50, 60 USD, and even the EU's JCM mechanism could be up to 110 USD/carbon credit.

Currently, nearly 30 countries and territories in the world have issued carbon taxes, with tax rates ranging from 1-137 USD/ton of CO2 (1 ton of CO2 equals 1 carbon credit). Therefore, developing the carbon credit market as soon as possible will help farmers gain double profits from agricultural products and carbon credits.

Selling forest carbon credits: Customers want to buy at very high prices but have not been able to sell yet. According to Dr. Le Xuan Nghia, the price of carbon credits is very 'hot'. There are 4.9 million remaining forest carbon credits, many customers want to buy at high prices but due to procedural problems, they have not been able to sell.