Foreign enterprises are always welcome to invest in new technology to create carbon credits.

Member of the Central Committee of the Communist Party of Vietnam and Minister of Natural Resources and Environment, Do Duc Duy, met and worked with Mr. Honna Hitoshi, Chairman and CEO of Erex Corporation of Japan.

On the afternoon of September 23rd, Mr. Do Duc Duy, Member of the Central Committee of the Communist Party of Vietnam and Minister of Natural Resources and Environment, met and worked with Mr. Honna Hitoshi, Chairman and CEO of Erex Corporation of Japan. Also attending the meeting with the Minister were leaders from various departments of the Ministry of Natural Resources and Environment: Mr. Le Ngoc Tuan, Director of the International Cooperation Department; Mr. Tang The Cuong, Director of the Climate Change Department; Mr. Hoang Van Thuc, Director of the Environmental Pollution Control Department; Mr. Nguyen Hung Thinh, Director of the Environment Department; and Mr. Pham Tan Tuyen, Chief of the Ministry's Office.

*Minister Do Duc Duy and Mr. Honna Hitoshi, Chairman and CEO of Erex Corporation, Japan.*

During the meeting, Mr. Honna Hitoshi stated that EREX is currently one of the companies actively exploring and investing in the biomass power sector in Vietnam. EREX is researching and proposing the implementation of 14 biomass power plant projects in 12 provinces with a total capacity of over 1,000 MW. One of these projects, a 20 MW biomass power plant in Hau Giang, has already received support from the Japanese government for construction under the Joint Crediting Mechanism (JCM) and commenced construction in December 2022. The project is expected to be registered as a JCM project in 2024.

EREX has recently received support from the Japanese government to develop two additional biomass power plants, each with a capacity of 50MW, in Yen Bai and Tuyen Quang provinces under the Joint Capital Mechanism (JCM). For projects expected to be registered under the JCM, EREX proposes a carbon credit allocation ratio that is satisfactory to all parties involved: the Vietnamese government, the Japanese government, and EREX itself.

*Mr. Honna Hitoshi, Chairman and CEO of Erex Corporation, Japan.*

During the meeting, Minister Do Duc Duy welcomed EREX's pioneering efforts in investing in greenhouse gas emission reduction and creating special carbon credits in the biomass power sector. Carbon credits earned from these projects will be tradable on Vietnam's carbon market in the future, and, depending on bilateral mechanisms and government priorities, may be transferred to partner countries, contributing to the implementation of their respective Nationally Determined Contributions (NDCs).

In discussions with the EREX Japan delegation regarding the development of the carbon market in Vietnam, Minister Do Duc Duy stated that regulations on the organization and development of the domestic carbon market have been incorporated into the 2020 Environmental Protection Law and further detailed in Decree No. 06/2022/ND-CP. Accordingly, the domestic carbon market includes activities involving the exchange of greenhouse gas emission quotas and carbon credits obtained from domestic and international carbon credit trading and offsetting mechanisms.

Minister Do Duc Duy stated that the Vietnamese government highly welcomes foreign businesses like EREX to invest in Vietnam in new technology projects that reduce greenhouse gas emissions and create carbon credits.

Currently, the Ministry of Natural Resources and Environment is in the process of reviewing and amending several provisions of relevant legal documents in order to soon be able to trade greenhouse gas emission quotas and carbon credits in 2025…

Regarding the Joint Crediting Mechanism (JCM), the Ministry of Natural Resources and Environment has recently continued to coordinate with the Ministry of Environment and relevant parties in Japan to review, supplement, and refine regulations and guidelines for project implementation within the framework of the Mechanism, ensuring compliance with domestic regulations of both countries and compatibility with international regulations; at the same time, receiving and exchanging project idea dossiers, project registrations, and new methodologies for application under the JCM Mechanism.

During the meeting, Minister Do Duc Duy and President/CEO Honna Hitoshi listened to presentations from specialized units of both sides and discussed in more detail the Joint Crediting Mechanism (JCM) and the Emissions Trading Scheme (ETS). EREX has been applying technology to transition from using fossil fuels (coal) to entirely using biomass, becoming a leading enterprise in the biomass power sector in Japan. EREX believes that using biomass fuel in coal-fired power plants helps maintain electricity production while promoting carbon neutrality, ensuring a balance between economic efficiency and environmental factors. EREX hopes to cooperate soon to bring the fuel conversion project into a Joint Crediting Mechanism (JCM) project in Vietnam.

EREX proposed holding a Joint Committee meeting between the Governments of Vietnam and Japan to discuss and reach common agreements between the two sides. EREX also proposed establishing a joint special working group to create the ETS market in Vietnam.

Acknowledging the discussions at the meeting, Minister Do Duc Duy highly appreciated EREX as a pioneering investor in Vietnam and its long-term commitment to working with the Vietnamese Government towards the NetZero goal. He noted that EREX and its projects serve as a model for Vietnam and Japan to evaluate and establish common conventions and regulations on the implementation of the Joint Climate Change Mechanism (JCM). The Minister instructed the Climate Change Department to directly discuss and work with the company on matters related to the JCM mechanism and the exchange of emission rights.

Overview of the reception and working session on the afternoon of September 23rd.

In addition, the Ministry of Natural Resources and Environment will continue to promote the early organization of the 9th Joint Committee meeting to review and approve important contents, facilitating the implementation of activities within the framework of the JCM Mechanism in Vietnam. Regarding the establishment of a special working group to implement ETS, a thorough meeting and discussion will be held between the two sides, and specific plans will be developed.

Minister Do Duc Duy affirmed that the Vietnamese Government highly welcomes foreign enterprises like EREX to invest in new technology projects in Vietnam, reducing greenhouse gas emissions and creating carbon credits. The Minister requested relevant units under the Ministry of Natural Resources and Environment to continue supporting, providing, and exchanging information with EREX so that the company can soon invest in and implement more projects to reduce greenhouse gas emissions in the biomass power sector in Vietnam. He also expressed hope that EREX and the Ministry of Natural Resources and Environment will continue to have more effective cooperation activities, contributing to further deepening the relationship between Vietnam and Japan, especially in the field of natural resources and environment.