Hanoi (VNS/VNA) - As an emission trading system (ETS) will bepiloted next year and officially operated in 2028, a training course has beenheld starting on February 26 in Hanoi to promote understanding of the carbonmarket and ETS for Vietnamese public and private stakeholders.

The two-day conference, which is the first capacity-training in Vietnam and isorganised by the Southeast Asia Energy Transition Partnership (ETP) incooperation with the Department of Climate Change (DCC), Ministry of NaturalResources and Environment (MONRE), targets representatives from ministries,development donors, and financial institutions; with a comprehensive andsystematic training curriculum on ETS and carbon markets using a marketsimulation tool.

The initiative comes at a crucial time as Vietnam is pushing to reduce carbonemissions and making efforts to fulfil its obligations under the ParisAgreement.

“The training programme will contribute to enhancing the understanding ofstakeholders regarding their respective positions and roles in the developmentof Vietnam’s carbon market. In addition, these activities will facilitatecloser collaboration among participants, aiming to establish and effectivelyoperate the market,” said Fritzie Vergel, a representative of ETP.

Mai Kim Lien, deputy director of the Department of Climate Change under theMONRE, emphasised the supportive activities of international organisations inthe development of the Vietnamese carbon market.

"Within the framework of the Memorandum of Understanding between theDepartment of Climate Change and the United Nations Office for Project Services(UNOPS), the ETP programme encompasses various supportive initiatives,” Liensaid.

“One such activity involves the selection and guidance on utilising a systemsimulation tool for greenhouse gas emission allowance trading. This tool aimsto facilitate a deeper understanding among relevant parties regarding thefunctionalities, operational processes, management, and trading of emissionallowances and carbon credits on the trading platform.

“It serves as highly valuable support for stakeholders involved in theestablishment and successful operation of the greenhouse gas emission allowancetrading and carbon credit markets in Vietnam.”

The establishment of a robust ETS plays a pivotal role as stated in the updatednationally determined contribution (NDC) in 2022. By placing a cap on totalemissions and allowing companies to buy and sell credits, ETS introduceseconomic incentives for businesses to reduce their emissions efficiently.

Even though Vietnam is going to pilot an ETS next year, there are manychallenges that remain, said Dang Hong Hanh, co-founder of Energy andEnvironment Consultancy JSC (VNEEC).

“In some countries, they have three to five years of preparation beforepiloting, but we only have one year.”

“There are many new technical and managerial requirements that requiresignificant resources, and numerous legal documents and implementationguidelines need to be issued in 2024.

"This undertaking necessitates strong political commitment and activeengagement from diverse stakeholders. Simultaneous execution of multiple tasksis imperative, alongside the selection of an appropriate scale for the pilotphase."

Moreover, the carbon market is characterised by volatility, necessitatingadaptable policies and ongoing adjustments. However, the policy-making processin Vietnam is time-consuming and involves multiple steps, Hanh added.

The second training course is specifically designed for representatives fromenergy-intensive enterprises, business associations, and media, and will beheld from February 29 to March 1./.