ART TREES accepts Vietnam's registration, monitoring reports for jurisdictional carbon credits

The REDD+ Environmental Excellence Standard, which is the world's first purely jurisdictional carbon credit standard under Virginia-based carbon registry ART, has accepted Vietnam's carbon registration and monitoring reports, paving the way for the country to deliver jurisdictional carbon credits to the market, ART said in a statement late July 10.

Jurisdictional carbon credits are backed by the governments of project host country and buyer country, with bilateral agreements to ensure that each carbon credit transferred can only be counted toward one country's emission reduction target under the UN's Paris Agreement. Vietnam has signed such bilateral agreements with Japan and Singapore under the UN's Article 6 framework.

REDD+ standard issues carbon credits from projects that reduce emissions from deforestation and forest degradation. Despite the trust crisis in the past two years that questioned environmental integrity of the REDD+ emission accounting approaches, REDD+ is still widely seen as a viable market instrument for companies to offset their emissions at affordable costs.

The documents submitted by Vietnam included a registration report that covered carbon crediting for emissions reduced or to be reduced in 2021-2025 and a monitoring report for emission reductions in 2021-22.

Carbon registry ART's acceptance of Vietnam's documents indicated that the country's REDD+ program is eligible for jurisdictional carbon credit issuance. Subsequently, it can proceed with developing REDD+ projects, and then validating and verifying emission reductions through accredited verification bodies, the statement showed.

"Following successful validation and verification, the ART Board may approve the issuance of serialized TREES Credits to Vietnam," the ART statement showed.

If the TREES credits are successfully issued, Vietnam will be able to export these credits to its Article 6 partner countries.

Program details

According to the submitted documents, the Vietnamese government has selected 4.26 million hectares of forest areas to participate in this jurisdictional REDD+ program, which accounts for about 29% of the country's total forest areas.

The program is expected to cover 11 contiguous provinces, including Quang Ngai, Binh Dinh, Phu Yen, Khanh Hoa, Ninh Thuan, Binh Thuan, Kon Tum, Gia Lai, Dak Lak and Dak Nong, which jointly accounts for 22.4% of the country's population, according to the documents.

The population involved in this program are from more than 20 different ethnic groups, mainly ethnic minorities, the documents showed.

Based on the latest government plan, Vietnam planned to establish a national carbon credit exchange and officially start its operations in 2028. Before the full rollout of the exchange, the government proposed to initiate a pilot run of a carbon trading platform from 2025.

South Korea, Australia and Switzerland have expressed interests to trade Article 6-aligned jurisdictional carbon credits with Vietnam, the country's environment ministry said in a document earlier in May.

Besides Vietnam, ART TREES has also approved jurisdictional REDD+ programs of Brazil, Burkina Faso, Colombia, Congo, Costa Rica, Ecuador, Ethiopia, Gabon, Ghana, Guyana, Mexico, Nepal, Papua New Guinea, Peru and Uganda.

Platts, part of S&P Global Commodity Insights, last assessed nature-based avoidance carbon credit at $3.6/mtCO2e July 10, 18% lower year on year. Nature-based avoidance assessment is the Platts assessment that reflects market value of REDD+ credits.