Inception workshop of the technical assistance “Emission Trading System (ETS) training and simulation in Vietnam”

On the morning of September 14, 2023, in Hanoi, the Energy And Environment Consultancy Joint Stock Company (VNEEC) successfully organized the inception workshop for the Technical Assistance (TA) “Emission Trading System (ETS) training and simulation in Vietnam”. The TA is sponsored by the Southeast Asia Energy Transition Partnerships (ETP) program and managed by the United Nations Office for Project Services (UNOPS). This is one of ETP’s support aimed at implementing activities to implement the Memorandum of Understanding (MOU) between UNOPS and the Department of Climate Change (DCC) to develop the carbon market in Vietnam.

The main objective of this TA is to develop and organize training courses on ETS for stakeholders including policymakers, research institutes, universities, financial institutions, media, and especially big emitters – the units that will participate directly in Vietnam’s ETS in the future. The training courses under this TA activity will use a carbon market simulation tool specifically tailored to the Vietnamese context. At the same time, an ETS website will also be built to provide knowledge and enhance the awareness and readiness of stakeholders about ETS in the future in Vietnam. Furthermore, this TA will compile policy recommendations for the design and implementation of ETS in Vietnam based on analysis of lessons learned and the impact of ETS on the energy transition process.

Dr. Mai Kim Lien, Deputy Director of the Department of Climate Change, spoke at the workshop

Speaking at the workshop, Dr. Mai Kim Lien – Deputy Director of the DCC said: ‘‘The roadmap for implementing the carbon market is specified in Decree 06/2022/ND-CP dated January 7, 2022 of the Government (Decree 06/2022/ND-CP). Accordingly, from now until the end of 2027, the Ministry of Finance (MOF), the Ministry of Natural Resources and Environment (MONRE), and related ministries will develop regulations on carbon credit management, allowances, and carbon credits exchange activities; Develop regulations for operating the carbon trade exchange. Agencies will also establish and operate a pilot carbon trade exchange from 2025; Pilot the carbon trade exchange and offsetting mechanism in potential areas and deploy activities to strengthen capacity and raise awareness about carbon market development. Within the framework of the MOU between the DCC and the UNOPS, ETP, one of the support activities is to select and instructions on using the simulation tool for the ETS to facilitate relevant parties to understand more about the functions, operating procedures, management, and trading of allowances, carbon credits on the exchange. This is a very useful support for stakeholders in establishing and operating the emission allowance and carbon credit trading exchange in Vietnam.”

Mr. John Robert Cotton, Senior Program Manager, Southeast Asia Energy Transition Partnership (ETP) spoke at the workshop

According to Mr. John Robert Cotton, Senior Program Manager of ETP: “The impacts of climate change have been very apparent, manifested through the increasing occurrences of extreme weather events and the negative consequences that countries have to face. The current issue is to accelerate activities to reduce greenhouse gas (GHG) emissions. Vietnam has made strong commitments to achieve net zero by 2050, demonstrating this determination through the enactment of the Environmental Protection Laws 2020 and Decree 06/2022/ND-CP, which includes provisions for establishing the carbon market. This is a significant driving force, and ETS plays a role as a tool to encourage businesses to adopt emission reduction technologies in the future, contributing to the trend of transitioning the economy towards sustainability.”

Ms. Dang Hong Hanh, the Leader of the National Climate Policy Expert Team

According to Ms. Dang Hong Hanh, the leader of the National Climate Policy Expert Team, the training courses in this TA will utilize a simulation tool tailored to the Vietnamese context for the carbon market. Simultaneously, a website focusing on ETS and the carbon market will be developed to provide knowledge as well as enhance awareness, and readiness of stakeholders regarding ETS in the future in Vietnam. From the information obtained from the training courses and based on the analysis of lessons learned and the impact of the ETS on the energy transition, this technical assistance will compile policy recommendations for the design and implementation of ETS in Vietnam.

In the upcoming period, VNEEC and technical support partners will conduct analyses, surveys, and consultations on the readiness and awareness of businesses and facilities regarding GHG emissions and carbon markets. Simultaneously, comprehensive training courses on ETS and the carbon market will be planned for key officials involved in carbon market development. These training courses aim to facilitate learning, knowledge exchange, as well as management experience related to ETS.

At the workshop, representatives of the DCC, policymakers, as well as domestic and international experts, introduced the design and roadmap for implementing Vietnam’s ETS; the development of ETS around the world, and the role of ETS in the energy transition process and achieving the goals of Vietnam’s Nationally Determined Contribution (NDC); implementation plan and technical support schedule; and introduce CarbonSim – a carbon market simulation tool in training courses. Delegates engaged in discussions, clarifying and delving deeper into ETS and upcoming training activities.