Vietnam to debut first carbon trading exchange next week

Vietnam will launch its first domestic carbon trading market on June 29, allowing major industrial emitters and power producers to trade greenhouse gas emissions quotas as the country moves toward a market-based system for reducing carbon emissions.

The Department of Climate Change (DCC) under the Ministry of Agriculture and Environment said it has completed the registration of emissions allowances for the 2025-2026 period on the national emissions quota and carbon credit registry, marking a key milestone in the development of Vietnam’s carbon market.

More than 511 million metric tons of carbon dioxide equivalent (CO2e) emissions allowances have been allocated to the country’s three largest emitting sectors – thermal power, steel and cement – for the 2025-2026 period. The allowances will be available for trading on Vietnam’s carbon exchange from June 29, 2026 through December 24, 2027.

A total of 92 companies from carbon-intensive industries will participate in the pilot market, including major industrial groups such as steelmaker Hoa Phat (HoSE: HPG), Formosa, Vietnam Electricity (EVN), PV Power (HoSE: POW), and cement producer Vicem.

Earlier this year, the government approved emissions quotas of approximately 243 million tons of CO2e for 2025 and 268 million tons for 2026 across the three sectors.

Under the trading mechanism, companies that exceed their allocated emissions quotas will be required to purchase additional allowances from firms with surplus quotas or use carbon credits to offset excess emissions.

Carbon credits can be used to cover up to 30% of an entity’s allocated emissions quota. Each carbon credit represents the right to emit one metric ton of carbon dioxide or an equivalent amount of greenhouse gases.

Vietnam plans to operate the market on a pilot basis through end- 2028 before launching a fully operational carbon trading system in 2029. During the pilot phase, participating companies will not be charged transaction fees.

DCC representatives said most key components of the carbon market have been completed, including the national emissions registry, databases, and information technology infrastructure. Final trading regulations and licensing procedures for market participants are still being finalized.

On June 22, DCC signed cooperation agreements with the Vietnam Exchange (VNX), the Vietnam Securities Depository and Clearing Corporation (VSDC), and the Hanoi Stock Exchange (HNX) to prepare for market operations.

Under the current framework, emissions allowances and eligible carbon credits will be registered on the national registry managed by the Ministry of Agriculture and Environment, deposited at VSDC and traded through the HNX platform.

The carbon market is expected to drive Vietnam’s efforts to meet its net-zero commitments by 2050.