Vietnam’s fertile forest land and forest ecology can help reduce greenhouse gas emissions and climate change. But the country may prove to bewell placed to help satisfy the world’s growing demand for greendevelopment. Report by the Vietnam Investment Review.
In June 2013, Japanese giant Honda started work on an over 800,000 USDcarbon-absorbing forest, or carbon sink, project. The project will runthrough 2018 and spans 490 hectares with planting to proceed in annualphases through 2016. The company should start receiving carbon creditsaround 2020.
The project follows a similar frameworkto that of Honda’s 309ha forest in the northern province of Hoa Binh,running since 2008. It is expected to absorb 41,000 tonnes of CO2 eachyear.
Australian Voluntary Credits Company alsowants to have similar plans in mind for Vietnam, and will bring itsextensive experience in Indonesia and Papua New Guinea to bear.
Investors will build the forest as a gateway to receiving carboncredits known as certified emission reductions (CERs) against their CO2emissions worldwide. The credits are granted by the InternationalExecutive Board on Clean Development. The company may use the credits,but the credits are often a transacted commodity between businesses.
They are also a form of corporate social responsibility (CSR). Forexample in Australia, companies not obligated to reduce their emissionsstill buy credits, as a move toward future business.
Germany’s ForestFinance Group - specialising in forestry carbonsolutions - is already working with a local company to build a 50year/1,500ha sink, with the capacity to absorb 400,000 tonnes of CO2 inCentral Highland Kon Tum province. After 50 years, ForestFinance willstop selling CERs from this project, which will be then transferred tothe local company.
Projects, such as these, fallunder the Kyoto Protocol’s Clean Development Mechanism (CDM) wherebusinesses in countries that limit or are working to reduce emissionscan implement emission-reducing projects outside their home country.Carbon credits produced by these projects follow the standard of onecredit/one tonne of CO2 exchange.
According to theMinistry of Agriculture and Rural Development, Vietnam’s fertile forestland can help reduce green house gas emissions and climate change. Itnoted that Vietnam’s forest ecology was particularly good at absorbingCO2. The country’s forest land totals 13.1 million ha, most of it arenatural with about 2.8 million ha of reforestation.
Vietnam is beginning to make a name for itself in the carbon creditmarket. While it is very new to the country, several local and foreignenterprises already have plans in the works.
Forestsare a popular method of earning credits, but other projects inrenewable energy, waste management, and agriculture are also underway.
Hanoi, back in 2009, built a gas-to-energy system atNam Son waste treatment complex, earning carbon credits and invested inby a Malaysian-Canadian joint venture.
The 7.5million USD project, which uses discharged gas and converts it toelectricity, will run through 2016 and is expected to reduce emissionsby 2.3 million tonnes. The municipal People’s Committee receives 10 percent of the total revenues from the project’s carbon credit trade.
Vietnam does not yet fall under obligations of the Kyoto Protocol andtherefore, companies that save on energy and reduce emissions can earncarbon credits. This may be a boon to local businesses that invest inthe technology and sell their earned credits to foreign companiesburdened by emissions limits.
According to theMinistry of Natural Resources and the Environment’s Agency forMeteorology, Hydrology and Climate Change (AMHCC), Vietnam has severalcarbon credit projects in play, including gas-to-energy, afforestationand reforestation, wind power, and hydroelectricity.
Between 2004, the birth of the carbon credit era, and 2012, Vietnamapproved 135 carbon credit project frameworks and two action programmes.As many as 37 projects have already been registered as accredited and4.5 million credits have already been granted to two projects.
PetroVietnam Finance Joint Stock Corporation launched a gas-to-energyproject exploiting the offshore Rang Dong oil field in 2008 which hasalready earned more than 4.4 million credits, the vast majority, whilethe other is a locally-owned small-scale hydroelectric project,responsible for the remainder.
The Rang Dong projectuses gas released from the oil field to produce power and liquefiedgas, and was calculated to help Vietnam reduce nearly 7 million tonnesof CO2 by 2011. The project kicked off in 2001 and its returns amountedto nearly 200 million USD.
AMHCC deputy directorgeneral Nguyen Khac Hieu stressed that Vietnam ranked 11th in the worldin terms of registered carbon credit projects, and 8th in total carboncredits. "Carbon credits have great potential in Vietnam," he said.
Companies from all over the world, particularly in western Europe,have come to Vietnam in search of projects and opportunities, he added.
According to the Vietnam Energy and EnvironmentConsultancy Joint Stock Company, Vietnam annually earns around 24million USD from trading in carbon credits, and prices fluctuated, with18 USD in 2008 quickly rising to 31 USD in 2010.-VNA
In June 2013, Japanese giant Honda started work on an over 800,000 USDcarbon-absorbing forest, or carbon sink, project. The project will runthrough 2018 and spans 490 hectares with planting to proceed in annualphases through 2016. The company should start receiving carbon creditsaround 2020.
The project follows a similar frameworkto that of Honda’s 309ha forest in the northern province of Hoa Binh,running since 2008. It is expected to absorb 41,000 tonnes of CO2 eachyear.
Australian Voluntary Credits Company alsowants to have similar plans in mind for Vietnam, and will bring itsextensive experience in Indonesia and Papua New Guinea to bear.
Investors will build the forest as a gateway to receiving carboncredits known as certified emission reductions (CERs) against their CO2emissions worldwide. The credits are granted by the InternationalExecutive Board on Clean Development. The company may use the credits,but the credits are often a transacted commodity between businesses.
They are also a form of corporate social responsibility (CSR). Forexample in Australia, companies not obligated to reduce their emissionsstill buy credits, as a move toward future business.
Germany’s ForestFinance Group - specialising in forestry carbonsolutions - is already working with a local company to build a 50year/1,500ha sink, with the capacity to absorb 400,000 tonnes of CO2 inCentral Highland Kon Tum province. After 50 years, ForestFinance willstop selling CERs from this project, which will be then transferred tothe local company.
Projects, such as these, fallunder the Kyoto Protocol’s Clean Development Mechanism (CDM) wherebusinesses in countries that limit or are working to reduce emissionscan implement emission-reducing projects outside their home country.Carbon credits produced by these projects follow the standard of onecredit/one tonne of CO2 exchange.
According to theMinistry of Agriculture and Rural Development, Vietnam’s fertile forestland can help reduce green house gas emissions and climate change. Itnoted that Vietnam’s forest ecology was particularly good at absorbingCO2. The country’s forest land totals 13.1 million ha, most of it arenatural with about 2.8 million ha of reforestation.
Vietnam is beginning to make a name for itself in the carbon creditmarket. While it is very new to the country, several local and foreignenterprises already have plans in the works.
Forestsare a popular method of earning credits, but other projects inrenewable energy, waste management, and agriculture are also underway.
Hanoi, back in 2009, built a gas-to-energy system atNam Son waste treatment complex, earning carbon credits and invested inby a Malaysian-Canadian joint venture.
The 7.5million USD project, which uses discharged gas and converts it toelectricity, will run through 2016 and is expected to reduce emissionsby 2.3 million tonnes. The municipal People’s Committee receives 10 percent of the total revenues from the project’s carbon credit trade.
Vietnam does not yet fall under obligations of the Kyoto Protocol andtherefore, companies that save on energy and reduce emissions can earncarbon credits. This may be a boon to local businesses that invest inthe technology and sell their earned credits to foreign companiesburdened by emissions limits.
According to theMinistry of Natural Resources and the Environment’s Agency forMeteorology, Hydrology and Climate Change (AMHCC), Vietnam has severalcarbon credit projects in play, including gas-to-energy, afforestationand reforestation, wind power, and hydroelectricity.
Between 2004, the birth of the carbon credit era, and 2012, Vietnamapproved 135 carbon credit project frameworks and two action programmes.As many as 37 projects have already been registered as accredited and4.5 million credits have already been granted to two projects.
PetroVietnam Finance Joint Stock Corporation launched a gas-to-energyproject exploiting the offshore Rang Dong oil field in 2008 which hasalready earned more than 4.4 million credits, the vast majority, whilethe other is a locally-owned small-scale hydroelectric project,responsible for the remainder.
The Rang Dong projectuses gas released from the oil field to produce power and liquefiedgas, and was calculated to help Vietnam reduce nearly 7 million tonnesof CO2 by 2011. The project kicked off in 2001 and its returns amountedto nearly 200 million USD.
AMHCC deputy directorgeneral Nguyen Khac Hieu stressed that Vietnam ranked 11th in the worldin terms of registered carbon credit projects, and 8th in total carboncredits. "Carbon credits have great potential in Vietnam," he said.
Companies from all over the world, particularly in western Europe,have come to Vietnam in search of projects and opportunities, he added.
According to the Vietnam Energy and EnvironmentConsultancy Joint Stock Company, Vietnam annually earns around 24million USD from trading in carbon credits, and prices fluctuated, with18 USD in 2008 quickly rising to 31 USD in 2010.-VNA
