Vietnam Accelerates Carbon Credit Exports, Vingroup Leads the Way

Vietnam's government has officially enacted Decree No. 112 on the international exchange of greenhouse gas emission reductions, creating a legal framework for the transfer of carbon credits to foreign partners. This move has spurred numerous businesses and project developers to seize the opportunity, preparing their data infrastructure and MRV (Measurement, Reporting, and Verification) systems to enter the carbon credit market. Vingroup has already prepared its measurement platform for 4.5 million carbon credits generated from its electric vehicle (EV) fleet and charging stations. Meanwhile, Green Carbon Japan Vietnam is awaiting approval to sell 500,000 credits from its agricultural emission reduction project to Japan. Tran Ky Anh, Carbon Credit Transaction Manager at Vingroup, stated that the company built its data infrastructure from the early stages of its projects, forming the foundation for its participation in the carbon market. For instance, its V-Green charging stations are equipped with smart electricity meters integrated into a centralized management platform. Real-time data on each charging pile is recorded and updated, providing the basis for calculating emission reductions in line with international carbon credit MRV standards. A carbon credit is a tradable certificate or permit representing the right to emit one ton of CO2 or another greenhouse gas. Vingroup's electric mobility ecosystem, centered around VinFast EVs, V-Green charging stations, Green SM ride-hailing services, and Vinbus electric buses, is being expanded with investments in renewable energy and high-speed rail. The conglomerate anticipates generating 1 million credits from the transition of gasoline motorbikes to EVs between 2025-2029, and up to 3.5 million tons of CO2 reduction annually from its charging station development. Green Carbon Japan Vietnam is developing an emission-reducing rice cultivation project using the Alternate Wetting and Drying (AWD) technique across 80,000 hectares in 15 provinces. Phan Tien Thanh, the company's Business Development Manager, estimates they will generate 500,000 carbon credits this year, which are currently awaiting approval from authorities for sale to international markets. The company targets markets with established Emission Trading Systems (ETS) or strict carbon taxes, having already secured bilateral agreements with countries like Japan, Singapore, and South Korea. The expected price is between $15-30 per credit, depending on the market. Under Decree 112, businesses can sell carbon credits abroad through three mechanisms: bilateral agreements between countries, a centralized mechanism under the supervision of the United Nations Framework Convention on Climate Change (UNFCCC), or independent standards like Verra and Gold Standard. To prevent over-selling, the government has set ceiling rates for the proportion of credits that can be sold, at 50% and 90%, depending on the project type. For example, projects related to charging stations, EVs, and rice cultivation have a 90% ceiling, while forestry projects have a 50% ceiling. Some businesses in sectors with a 50% ceiling have expressed "disappointment" and are increasing credit prices to cover costs. However, surplus credits have the potential to be sold on the domestic carbon exchange. The government's policy allowing polluting companies to purchase up to 30% of their emission quotas through carbon credits is expected to create demand for these credits. This dual opportunity for domestic and international sales is seen as a significant incentive for companies to develop carbon projects. Nguyen Tuan Quang, Deputy Director of the Department of Climate Change at the Ministry of Agriculture and Rural Development, noted that many Vietnamese businesses in export, energy, agriculture, and forestry sectors are showing interest in developing credit-generating projects. Several localities are also proactively seeking opportunities to exploit their emission reduction potential. The Deputy Director emphasized that proactive participation in the carbon market will help Vietnam and its businesses fulfill their emission reduction commitments while capitalizing on new development opportunities during the transition to a green economy. Source: VnExpress