The Government on January 7 issued a decree requiring the establishment and trial operation of a carbon trade exchange by 2025.
According to Decree 06 on mitigation of greenhouse gas emission and protection of the ozone layer, by the end of 2027, legal norms on management of carbon credits, commence exchange activities of greenhouse gas emission quotas and carbon credits will be issued and a regulation on operation of a carbon credit exchange will be enacted.
A pilot mechanism for exchanging and offsetting carbon credits in potential sectors will be implemented, while guidance on implementation of the domestic and international carbon credit exchange and offsetting mechanism will be provided in accordance with Vietnam’s law and treaties to which the country is a contracting party.
By 2028, the carbon credit exchange will be put into official operation, and activities of connecting and exchanging domestic carbon credits with regional and global carbon markets will be regulated.
Under the new Decree, exchange of greenhouse gas emission quotas and carbon credits must be carried out on the carbon credit exchange and domestic carbon market.
The greenhouse gas emission quotas traded on the exchange will be subject to decision of the Ministry of Natural Resources and Environment in each period, in which one unit of greenhouse gas emission quota equals one ton of carbon dioxide (CO2).
Carbon credits obtained from programs and projects under the mechanism for carbon credit exchange and offsetting may be converted into offsetting units for greenhouse gas emissions quotas on the exchange, with one carbon credit equaling one ton of CO2.
The Decree also allows enterprises to bid to own more greenhouse gas emission quotas apart from amounts they are allocated in the same commitment period.
They may transfer their unused greenhouse gas emission quotas from the previous year to following years in the same commitment period, or borrow quotas allocated for subsequent years as long as these years are of the same commitment period.
The State encourages enterprises to willingly return their unused greenhouse gas emission quotas in order to help mitigate greenhouse gas emissions of the country.- (VLLF)