Vietnam has successfully concluded the sale of carbon credits equivalent to 10.3 million tons of CO2 to the World Bank for $51.5 million, Vietnamese online newspaper VnExpress said, citing a report from the Ministry of Agriculture and Rural Development, submitted to the prime minister on Thursday.
The carbon credits originate from forests in north-central Vietnam, as outlined in the Emissions Reduction Purchase Agreement (ERPA) between the International Bank for Reconstruction and Development (IBRD) of the World Bank and Vietnam’s agriculture ministry signed in October 2020.
Under the agreement, Vietnam would provide the World Bank with credits equivalent to 10.3 million tons of carbon dioxide (CO2) at $5 per ton.
The buyer has already paid $41.2 million (80% of the total) this year, with the remaining $10.3 million to be paid upon completion of the exchange.
According to VnExpress, it has been confirmed that 16.21 million tons of CO2 were reduced in north-central Vietnam during the first stage of the agreement, exceeding the agreed amount.
The Ministry of Agriculture is contemplating selling the credits for the remaining 4.91 million tons to generate additional funds for forest protection and conservation, and World Bank has expressed interest in purchasing an additional one million tons worth of credits, the newspaper said.
The revenue will be distributed to forest managers, provincial authorities, and agencies responsible for forest management.
Some funds will also be allocated to enhance the livelihoods of individuals involved in generating carbon credits.
The Vietnam Forest Protection and Development Fund will oversee the distribution of funds to the six north-central provinces benefiting from carbon credits: Thanh Hoa, Nghe An, Ha Tinh, Quang Binh, Quang Tri, and Thua Thien Hue.