MARD has reported to the Prime Minister about the ERPA (Emission Reductions Payment Agreement) and proposed transfer of the remaining greenhouse gas emission reductions in 2018-2019.

In October 2023, the World Bank confirmed MARD’s report on the emission reduction of 16.21 million tons of carbon for the first phase in the northern part of the central region. The result was enough to transfer 10.3 million tons of CO2 in accordance with the agreement on payment for emission reductions signed before.

With the transfer price of $5 per ton CO2, the amount to be paid to Vietnam would be VND1.2 trillion.

In mid-December 2023, after MARD signed the document on transferring 10.3 million tons of CO2, the World Bank released a letter confirming the transfer back of 95 percent of emission reduction results transferred to Vietnam to contribute to NDC (nationally determined contributions) in accordance with the commitments made.

After transferring 10.3 million tons of CO2 in accordance with ERPA, Vietnam still has 5.91 million tons of CO2 in 2018-2019.

MARD proposed transferring 1 million tons of CO2 to the World Bank in accordance with ERPA; about 95 percent of the transfer results would be transferred back to Vietnam to contribute to NDC.

According to MARD, some ministries have agreed on the proposal on additionally transferring the emission reductions to the World Bank. However, the Ministry of Finance (MOF) and some localities have proposed reconsidering the transfer prices, or considering transferring to non-World Bank partners.

Regarding the proposed $5 per ton of carbon, MARD said the emission reduction results transferred to the World Bank were results created in the past (2018-2019), so it would be difficult to seek other partners for commercial exchange.

The current carbon prices in the voluntary market in the world are $2-4 per ton of carbon, while the carbon prices in the field of forestry and land use in 2021 was $3.07 per ton of carbon. 

The update on carboncredits.com, the carbon price of natural ecosystem on March 5, 2024 was $1.57 per ton of CO2.

As for the remaining 4.91 million tons of carbon, MARD proposed that the Prime Minister ask the World Bank to introduce potential buyers, or support Vietnam to organize auctions via international trading floors.

The domestic carbon market would be established and become operational in 2028.

On March 21, the World Bank said Vietnam received a payment of $51.5 million for certified emissions reduction results (carbon credits).

Tam An