New regulations on “Organizing and developing domestic carbon market” in the Law on Environmental Protection 2020

25-06-2021

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 442 views

Receiving comments from the Member of National Assembly, the Standing Committee of the National Assembly directed the study, review and acquisition of specific regulations on organization and development of the carbon market as stipulated in Article 139 of the Law on Environmental Protection 2020.

Article 139. Organizing and developing domestic carbon market

1. The domestic carbon market covers the exchange of GHG emission quotas and carbon credits obtained from the participation in domestic and international carbon credit exchange and offsetting mechanisms in accordance with regulations of law and international treaties to which the Socialist Republic of Vietnam is a signatory.

2. GHG-emitting facilities that are required to conduct an inventory of GHGs on the list specified in Clause 3 Article 91 of this Law are given GHG emission quotas and reserves the right to exchange and trade quotas on the domestic carbon market.

3. Bases for determining GHG emission quotas include:

a) National climate change strategy and other relevant development strategies and planning;

b) Results of national GHG inventory, fields and facilities on the list specified in Clause 3 Article 91 of this Law;

c) Roadmap and methods for reducing GHGs in conformity with national conditions and international commitments.

4. GHG-emitting facilities are only allowed to emit GHGs within the allocated quotas; if they wish to emit GHGs in excess of the allocated quotas, they shall purchase quotas from other entities through the domestic carbon market.

5. Any GHG-emitting facility that reduces GHG emissions or has not used up its allocated quotas is entitled to sell its unused quotas to another entity through the domestic carbon market.

6. Every GHG-emitting facility participating in the domestic and international carbon credit exchange and offsetting mechanisms in accordance with regulations of law and international treaties to which the Socialist Republic of Vietnam is a signatory is allowed to exchange carbon credits on the domestic carbon market.

7. Every GHG-emitting facility participating in the domestic and international carbon credit exchange and offsetting mechanisms shall exchange, auction, borrow, pay for and transfer carbon quotas and credits in accordance with regulations of law and international treaties to which the Socialist Republic of Vietnam is a signatory.

8. The Ministry of Natural Resources and Environment shall request the Prime Minister to grant approval for total GHG emission quotas at the end of each stage and every year.

9. The Ministry of Finance shall preside over and cooperate with the Ministry of Natural Resources and Environment and other Ministries and ministerial agencies concerned to establish the domestic carbon market.

10. The Ministry of Natural Resources and Environment shall organize allocation of GHG emission quotas to entities as prescribed in Clause 2 of this Article; organize operation of the domestic carbon market and participation in international carbon markets.

11. The Government shall elaborate this Article and costs of allocating GHG emission quotas, roadmap and time for operating the domestic carbon market in conformity with national socio-economic conditions and international treaties to which the Socialist Republic of Vietnam is a signatory.

Source: Law on Environmental Protection 2020

The Partnership for Market readiness (PMR) initiative organized by the World Bank has created a Forum of ideas, technical proposals and financial resources to support countries, the area for capacity building to implement greenhouse gas emission reduction actions. The PMR initiative is implemented within the framework of the World Bank-funded Global PMR Program, assisting countries in conducting research, proposing and implementing policies to promote emissions reduction activities. greenhouses using the carbon pricing tools (carbon pricing instruments).The Law on Environmental Protection 2020 already has regulations on the development of carbon markets, but specific mechanisms have not yet been issued, the highest legal framework for transactions and the Law on Environmental Protection. the environment also needs to be further detailed by decrees, circulars and guidelines. The world market tools are available; Vietnam can rely on to build successfully suitable for the Vietnamese market.

As a consultant, VNEEC has participated in the component on the establishment of a database on greenhouse gas emissions, a carbon market tool and a roadmap for carbon market participation in the solid sector of PMR project.

 

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