A wind farm in Ninh Thuan province (Photo: VNA) Nguyen Vo Truong An, Deputy director of the Carbon Credit TradingPlatform JSC (CCTPA), said a majority of Vietnamese firms are not ready for themechanism because carbon credit trading is new in Vietnam and has not been puton their agenda.
He suggested the formation of a consulting agency, which would beresponsible for keeping firms well-informed about the registration andverification of carbon credits. With the agency, they, he believed, would be"better prepared for the new carbon tariff regime".
It is worth noting that CCTPA was the very first carbon tradingplatform in Vietnam, inaugurated in late September by the CT Group.
Nguyen Linh Ngoc, former Deputy Minister of Natural Resources andEnvironment, said the market of carbon credit had taken shape in Vietnam since2005 with the country's accession to the UN-run Clean Development Mechanism(CDM).
Several years later, Vietnam proceeded with its carbon-neutralambitions by participating in the Gold Standard (GS) and the Verified CarbonStandard (VCS). By late 2022, about 29.4 million carbon credits have beencreated in the country under CDM and 10 million under GS and VCS.
To promote the market, he called for high-quality technicalinfrastructures to support its connection with global markets. He said Vietnammust act quickly to kickstart the platform, or else it would miss the advantageof being an early mover.
"The platform is scheduled to go live in 2025, but it'dbetter be sooner," said Ngoc.
To Xuan Phuc from Humboldt University of Berlin outlined over 170types of carbon credits available on global markets today, with each comingwith a different price.
He also outlined several questions for Vietnam to answer beforeputting the platform into operation: Who are the sellers and buyers? How dothey create credits on the platform? Will the credits be recognised globally?
An said in Vietnam, carbon credits are potentially high in sectorsthat support the construction of renewable energy plants, including solar andwind farms, which help to offset the carbon emissions from heavy industries.
He also said Vietnamese firms are more likely to be low-balled byforeign buyers when trading carbon credits in voluntary markets because of thenature of their deals. However, this is not the case in regulatory markets.
"Carbon credit prices will not deviate from their true valueon the platform because they are determined by supply and demand," saidAn.
He revealed that the main objectives of CCTPA, for now, includeacting as a consultant for individuals and firms on carbon credits. It willalso be in charge of verifying and monitoring carbon-offsetting projects andproviding solutions to individuals and firms that want to minimise theirenvironmental impact.
CCTPA aims to become the largest platform in the ASEAN region onthe horizon.
There are broadly two types of carbon markets, the regulatorymarket and the voluntary market. The former is government-regulated whereas thelatter operates on a voluntary basis.
Market actors can buy carbon credits either directly fromdevelopers, through brokers, or on digital trading platforms. According toMarketsandMarkets, total carbon credits traded on digital platforms areprojected to reach 317 million USD in 2027 globally, against 106 million USD in2022./.
VNA
