Vietnam has officially launched the pilot phase of its emissions trading system (ETS), a significant step toward its commitment to reach net-zero carbon emissions by 2050, according to a report by Reuters.
The pilot scheme targets three major carbon-intensive industries:
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Steel
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Cement
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Thermal power
The first phase, which will run until 2029, is expected to cover around 50% of the country’s total carbon emissions. Under the program, companies in the covered sectors will be required to purchase carbon emission permits based on emission intensity—the amount of CO₂ emitted per unit of output.
The first permits, covering the 2025–2026 period, are slated for issuance by the end of 2025.
To ease the transition, most permits will initially be distributed free of charge, meaning the system will have limited immediate impact on actual emissions during its early years.
The Vietnamese government also plans to expand the ETS to additional sectors, including freight transportation and commercial real estate, in future phases.
This move aligns with global trends and reflects growing momentum across Southeast Asia to integrate market-based mechanisms into climate policy.
VietnamSteel by Hoa Sen Group
