Japanese climate tech company Green Carbon has signed a Memorandum of Understanding (MoU) with New Forests Asia to assess the feasibility of expanding carbon credit projects across Vietnam’s rice-growing regions, targeting methane reductions through changes in water management.
Under the agreement, announced Wednesday, Green Carbon will contribute its project development capabilities in Vietnam, while New Forests will assess investment opportunities using its expertise in nature capital.
The companies will jointly evaluate potential project sites, business models and the prospects for scaling projects based on alternate wetting and drying (AWD).
The potential project area covered by the partnership could range from about 50,000 to 180,000 hectares (roughly 123,000 to 444,000 acres).
Green Carbon is currently developing projects covering roughly 8,000 hectares (nearly 20,000 acres) in Can Tho City and another 2,000 hectares (nearly 5,000 acres) in Phu Tho Province.
The companies plan to examine additional opportunities, particularly in the Mekong Delta.
Water Management Offers Route To Methane Reductions
AWD involves periodically allowing flooded rice fields to dry to a specified water level before reflooding them, rather than keeping fields continuously submerged.
Green Carbon says the approach can reduce water consumption by as much as 30% and is expected to cut methane emissions from rice paddies by 30% to 70%, while potentially maintaining yields and generating carbon credits.
Relevant: Cool Effect Expands Superpollutant Portfolio With Rice Methane Project
Green Carbon and New Forests have not yet selected a carbon-crediting scheme. Options under consideration include Japan’s Joint Crediting Mechanism (JCM), approaches aligned with Article 6.2 of the Paris Agreement and the voluntary carbon market (VCM).
The MoU remains at the evaluation stage. If feasibility studies, due diligence and other pre-project assessments proceed successfully, the companies will consider potential capital deployment from 2027 onward.
Read more: New Forests’ $700M Global Natural Capital Fund To Also Include Carbon Investments
