Carbon credits from five provinces mark a new milestone in global climate cooperation.
The governments of five North Central provinces in Vietnam - Thanh Hoa, Nghe An, Ha Tinh, Quang Tri, and Thua Thien-Hue - will be responsible for implementing the ERPA (Emission Reductions Payment Agreement) at the local level, ensuring transparency and efficiency in managing revenue from carbon credit transfers.
According to the Quang Tri Provincial People's Committee, the government has issued Resolution No. 261/NQ-CP, approving the transfer of surplus greenhouse gas emission reductions in the North Central region during 2018-2019 to the International Bank for Reconstruction and Development (IBRD), a member of the World Bank Group.
This marks a critical step in Vietnam's emissions reduction payment mechanism, demonstrating the country's commitment to its climate change response goals.
Under the resolution, the government has approved the transfer of 1 million tons of CO₂ (out of 5.91 million tons of surplus reductions from 2018-2019 in the North Central region) to IBRD. Approximately 95% of these transferred emissions will be reassigned by IBRD to the Ministry of Agriculture and Environment to support the implementation of Vietnam's Nationally Determined Contributions (NDC).
The pricing and terms of the transfer are based on the ERPA agreement signed on October 22, 2020, between the Ministry of Agriculture and Rural Development (now renamed the Ministry of Agriculture and Environment) and IBRD. This international cooperation mechanism not only secures financial resources but also supports Vietnam in fulfilling its greenhouse gas reduction commitments.
The Ministry of Agriculture and Environment has been assigned to complete all procedures related to the transfer of 1 million tons of CO₂ as stipulated in ERPA, and to manage and use the revenue in compliance with Decree No. 107/2022/ND-CP, issued on December 28, 2022, which governs the pilot transfer of emission reduction results and financial management under ERPA.
Relevant ministries and agencies will work closely with the Ministry of Agriculture and Environment to implement both Resolution No. 261/NQ-CP and Decree No. 107/2022/ND-CP. At the same time, the People's Committees of the five provinces are tasked with coordinating local ERPA activities and ensuring effective and transparent revenue management from carbon credit transfers.
The successful transfer of 1 million tons of CO₂ to IBRD is seen as a concrete milestone that brings Vietnam closer to achieving its emissions reduction and sustainable growth goals. It also stands as a testament to Vietnam's close cooperation with the international community in the fight against global climate change.