Quang Binh receives over 3.38 million USD from selling carbon credit

Hanoi – The central province of Quang Binh got more than 82 billion VND (3.38 million USD) for its efforts to reduce greenhouse emissions in 2023, becoming the first locality in Vietnam to receive payment under the Emissions Reduction Purchase Agreement (ERPA).

The agreement was inked between the Ministry of Agriculture and Rural Development and the World Bank – the trustee agency of the Forest Carbon Partnership Facility (FCPF) in 2020. Accordingly, the FCPF will pay Vietnam 51.5 million USD if Vietnam fully implements its commitment, under which the north-central and central provinces of Thanh Hoa, Nghe An, Ha Tinh, Quang Binh, Quang Tri and Thua Thien – Hue are to reduce carbon footprint by 10.3 million tonnes during the 2018-2025 period.

According to Director of the provincial Department of Agriculture and Rural Development Mai Van Minh, with the agreement, Quang Binh will receive 235 billion VND for reducing more than 2.4 million tonnes of carbon dioxide emissions during 2023-2025.

The money it received this year will be used for forest protection and development of local livelihoods, he said, adding 80 billion VND will be transferred to beneficiaries, including 10,778 forest owners, 71 communal People’s Committees and nine other organisations, while the remainder is for the province’s Forest Protection and Development Fund.

Although the money paid for each household is not large, at around 800,000 VND, it will help raise public awareness of forest protection and prevention of slash-and-burn activities.

More than 469,300 hectares of forest to claim carbon credits in the year, he said, highlighting the province will review the forest area and forest coverage to work with its partners who want to purchase carbon credits to increase income for local people.

Among the localities engaged in the ERPA, Nghe An has the largest area of forest with more than 1 million hectares, giving opportunities for the province to capitalise on the carbon credit potential.

However, Director of the province’s Forest Protection and Development Nguyen Khac Lam said that carbon credit trading is a new area, which needs specific mechanisms and policies helping localities better access this potential market.

Vietnam plans to set up and pilot a carbon trade exchange from 2025 and officially run it in 2028, according to a new Government decree on greenhouse gas (GHG) emissions and Ozone layer protection.

The document stipulates several articles of the Law on Environmental Protection and maps out a roadmap for domestic carbon market foundation and development, he said, stressing it lacks a stipulation on state management in forests’ carbon storage, making it hard to count up the amount of forest carbon reserve.

The provincial plan for the rest of this decade and investor commitment of billions of US dollars are forming the crucial foundations for a new development journey for Quang Binh.

A cave with magnificent and pristine limestone formations has been freshly discovered in the central province of Quang Binh, which is often dubbed the "kingdom of caves" in Vietnam.