Vietnam has officially launched its pilot emissions trading system (ETS), bringing 51 cement plants into the country's first carbon market alongside 34 thermal power plants and 25 steel facilities.
The pilot scheme, which runs until the end of 2028, allocates greenhouse gas emissions allowances to participating facilities and allows them to trade surplus allowances, providing an early carbon price signal to encourage investment in emissions reduction technologies. A fully operational national ETS is scheduled to begin in 2029.
The cement sector is one of three energy-intensive industries included in the initial phase. The total emissions cap has been set at 243.08Mt of CO2 equivalent for 2025, increasing to 268.39Mt in 2026.
Vietnam has adopted a facility-based allocation system using a combination of emissions benchmarks and historical emissions data. Covered companies will also be permitted to use eligible carbon credits to meet up to 30 per cent of their compliance obligations, although offset availability is expected to remain limited during the pilot phase.
The launch follows Vietnam's introduction of mandatory waste heat recovery requirements for new and existing cement plants as part of its wider decarbonisation strategy.
