Ho Chi Minh City carbon neutrality efforts present a significant opportunity for the metropolis to lead Vietnam in achieving ambitious emission reduction targets and the increased use of renewable energy. Realizing this potential, however, necessitates groundbreaking development mechanisms. This article delves into the recent discussions by the Ho Chi Minh City National Assembly Delegation regarding a new draft Resolution aimed at piloting unique policies. These policies are designed to fully leverage the city’s capacity for sustainable growth, focusing on critical areas such as investment management, finance, urban planning, environmental resources, and attracting strategic investors to foster a greener economic landscape.
The Ho Chi Minh City National Assembly Delegation convened on March 30 to meticulously review and provide feedback on the draft Resolution. This vital document is intended to supersede Resolution 54/2017/QH14, which previously outlined pilot mechanisms and policies for the distinctive development of Ho Chi Minh City. The new draft Resolution encompasses nearly 40 provisions, strategically organized into four primary policy groups. These include continuing relevant mechanisms from the current Resolution 54, incorporating policies successfully implemented in other localities, trialing anticipated legal amendments ahead of other regions, and introducing proactive proposals from Ho Chi Minh City based on central government recommendations. After extensive revisions, the 5th draft of the Resolution has been restructured into 12 articles, with seven specific provisions focusing on unique policy groups related to investment, finance, budget, urban and environmental resource management, attracting strategic investors, science and innovation management, and the administrative organization of both Ho Chi Minh City and Thu Duc City.
The scene of the Meeting
Feedback from Experts on the Draft Proposal
During the Meeting, a diverse array of experts offered valuable feedback on the draft proposal. Among them was Mr. Pham Nam Phong, Chairman of Vu Phong Energy Group’s Board of Directors. Mr. Phong provided insights on critical aspects pertaining to carbon credit market dynamics and advocated for robust policy mechanisms aimed at accelerating the adoption of rooftop solar power. His recommendations are central to achieving ambitious emission reduction targets and positioning Ho Chi Minh City as a pioneer in carbon neutrality.
HCMC’s Opportunity for Renewable Energy and Carbon Neutrality
Mr. Pham Nam Phong firmly believes that Ho Chi Minh City is uniquely positioned to emerge as a national and regional leader in renewable energy and carbon neutrality. He voiced strong support for the implementation of an HCMC carbon neutrality pilot program, aligning with Vietnam’s commitment to achieve carbon neutrality by 2050 as declared at COP26. Given Ho Chi Minh City’s pivotal role in developing the southern economic zone and its significant contributions to the country’s socioeconomic progress, it possesses all the necessary prerequisites to successfully undertake such a pioneering initiative. The city has a tremendous opportunity for renewable energy development in HCMC.
Mr. Phong also highlighted the current lengthy and costly process of individual project execution for carbon credit approval, which often marginalizes the benefits of certification. To address this, he proposed that Ho Chi Minh City collaborate with the Ministry of Industry and Trade and the Ministry of Natural Resources and Environment to establish a pilot mechanism for carbon credit trading within the city. This approach would leverage the expertise of numerous carbon credit consulting firms in Vietnam and, if proven effective, would offer significant cost savings compared to managing separate projects. Furthermore, Mr. Phong suggested that Ho Chi Minh City should implement a mandatory carbon neutrality roadmap for local establishments and businesses. This measure would foster accountability among both state-owned enterprises and private entities, further solidifying the city’s role as a pioneering locality in emission reduction and greenhouse gas emissions neutrality.
Mr. Phong, Pham Nam – Chairman of Vu Phong Energy Group’s BODs – speaking at the Meeting
The Role of Private Investors in HCMC’s Breakthrough Development Mechanism
A crucial point raised was the need to diversify investment sources beyond solely relying on the Ho Chi Minh City budget, as initially stated in Article 5, Clause 10 of the Draft Resolution. Mr. Pham Nam Phong proposed incorporating funding from private investors eager to contribute to Ho Chi Minh City’s breakthrough development mechanism. This would empower city public units to choose between utilizing the City’s Budget or collaborating with private investors when implementing guiding mechanisms.
A highly feasible solution for reducing emissions, for which Ho Chi Minh City possesses numerous favorable conditions, is the widespread expansion of rooftop solar power. This solution uniquely capitalizes on idle roof spaces, avoiding land occupation. Ho Chi Minh City’s potential for rooftop solar power is substantial, with an estimated capacity exceeding 5,000 MWp, capable of generating over 7 billion kWh of electricity annually. Considering that the city’s total electricity consumption demand was 27 billion kWh in 2022, on-site generation and utilization of this 7 billion kWh would significantly reduce the need for external transmission, thereby decreasing investment requirements for electricity transmission infrastructure. These strategic Vietnamese article on HCMC emission neutrality mechanisms are crucial.
A solar power system on the roof of Vinamilk’s factory
Mr. Pham Nam Phong asserted that technical barriers to the growth of rooftop solar power in HCMC are minimal. Instead, the challenges lie in policy mechanisms. The Prime Minister’s Decision 13/2020/QD-TTg, which regulated the retail price of solar power, has expired. The current impediment is the lack of guidance for connecting new rooftop solar power systems, requiring the government to issue and implement new directives. Consequently, HCMC urgently needs a breakthrough policy for developing rooftop solar power, serving two key objectives: reducing emissions and lowering electricity costs for the City’s public governmental agencies, public service units, and private entities. Vu Phong Energy Group is actively researching a project to install a rooftop solar power system with approximately 500 kWp at Cu Chi General Hospital, estimated to reduce carbon emissions by over 500 tons per year. Scaling this to HCMC’s potential of 5,000 MWp of solar power would lead to a substantial reduction in overall carbon emissions.
Another critical consideration is Ho Chi Minh City’s position as the nation’s second-highest recipient of FDI investment, with many investors keenly interested in developing a green and circular economy. To participate in the global green supply chain, these companies must demonstrate a certain percentage of renewable energy use in their operations. This requirement is increasingly becoming a criterion for allocating orders among international businesses with extensive supply networks. Therefore, failure to address this issue could diminish Ho Chi Minh City’s attractiveness to investors seeking sustainable and environmentally responsible partners. To achieve the anticipated breakthrough in Ho Chi Minh City, it is essential to boldly delegate and empower localities to implement robust HCMC development mechanisms. Many companies, including Vu Phong Energy Group, are prepared to support and contribute to Ho Chi Minh City’s ongoing growth and its leadership role in the country’s economy.
Vu Phong Energy Group JSC
