Vietnam approves carbon market roadmap, pilot ETS to launch in June 2025
On 24 January 2025, Vietnam’s Prime Minister approved a roadmap for implementing a domestic carbon market to support the country’s net-zero emissions target by 2050. The plan includes a pilot ETS starting in June 2025, with full implementation scheduled for 2029.
Decision No. 232/QD-TTg (Decision 232) builds on a 2020 law mandating the Ministry of Natural Resources and Environment (MONRE) to develop an ETS and a measurement, reporting, and verification (MRV) system. It also follows Decree 06/2022/ND-CP, which requires facilities in key sectors to submit emissions inventories starting in 2025 and provides an initial timeline for ETS and carbon credit market development.
Under the approved roadmap, the government is responsible for establishing the framework for a domestic carbon market, incorporating both an ETS and a market for carbon credits. For the ETS, the government will develop a decarbonization plan for covered sectors and allocation plans for covered entities. Certified Carbon Credits (CCCs) will be eligible for ETS compliance and can be sourced from both domestic and international mechanisms, including the Clean Development Mechanism (CDM), the Joint Crediting Mechanism (JCM), and the Article 6.4 mechanism of the Paris Agreement. MONRE will issue enabling regulations, oversee governance, and manage the national registry and MRV systems, while the Hanoi Stock Exchange (HNX) will operate the carbon exchange.
Ahead of the June 2025 pilot launch, MONRE is developing the necessary regulatory framework, including defining GHG emission limits and allocation plans for the period until 2030, regulation for the recognition and management of carbon credits, and auctioning and trading rules. During this phase, the government is also prioritizing infrastructure development and capacity-building activities to prepare government agencies and covered entities.
During the pilot phase, running from June 2025 to December 2028, the government will allocate emissions allowances for free to facilities in high-emitting sectors. CCCs will be allowed to offset emissions within the limits set by the government. The government is expected to issue additional regulation specifying the sectors and emission thresholds covered during the Pilot Phase, with a focus on finalizing regulations and enhancing infrastructure to ensure a smooth transition to a fully functional market.
From 2029, the carbon market will become fully operational, expanding sectoral coverage and introducing auctioning mechanisms alongside the free allocation of allowances. The government will continue refining regulations, infrastructure, and oversight to enhance market efficiency and long-term effectiveness.
