Energy Transition Update: 11.5 - 18.5.2026
Energy Transition Update: 11.5 - 18.5.2026
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Energy Transition Update: 11.5 - 18.5.2026 ---
Old Quarter residents face difficulties switching to electric vehicles
Residents in Hanoi’s Old Quarter are facing growing difficulties in switching to electric vehicles because of limited charging infrastructure, narrow living spaces and the lack of dedicated parking areas. Many households rely on shared sidewalks or temporary parking arrangements, making home charging difficult and raising concerns about fire safety and electricity access. The situation highlights a broader tension between Vietnam’s push for greener urban transport and the practical constraints of older, densely populated urban areas. Although electric vehicles are increasingly promoted as part of the country’s emissions reduction strategy, the transition may require substantial investment in urban infrastructure, charging networks and residential adaptation to become viable for residents in historic inner-city districts.
Proposal would require businesses to pay taxes on behalf of scrap collectors
The Vietnam Chamber of Commerce and Industry (VCCI) has proposed allowing recycling and scrap purchasing companies to declare and pay taxes on behalf of small-scale scrap collectors and informal waste pickers under amendments to tax management regulations. The proposal aims to reduce administrative and tax compliance barriers for informal workers who often lack the capacity to issue invoices or complete tax procedures. Authorities and businesses argue that the current system limits formal recycling supply chains because many collectors prefer selling to informal workshops. The proposed mechanism could help formalise recycling activities, improve tax collection and support Vietnam’s broader circular economy strategy, while reducing resource waste and environmental pollution.
Hanoi, Japan’s Yamanashi Prefecture enhance cooperation in green transition
Hanoi and Japan’s Yamanashi Prefecture agreed to strengthen cooperation in green transition, focusing on renewable energy, environmental technology, smart agriculture and sustainable urban development. The partnership reflects broader efforts by Hanoi to expand international cooperation in low-carbon development and climate adaptation as the city faces increasing pressure from urbanisation and environmental challenges. Discussions also covered technology transfer, human resource training and investment promotion in green industries. The cooperation highlights growing Vietnam–Japan collaboration in sustainability and energy transition, particularly as local governments seek practical models for green growth and carbon reduction.
Construction waste surges toward 10 million tonnes annually
Vietnam’s construction waste is rising rapidly, increasing from around 1.9 million tonnes in 2010 to an estimated 9.6 million tonnes in 2025 as urbanisation, infrastructure expansion and redevelopment projects accelerate across major cities. Construction waste now accounts for roughly 10–12 per cent of total urban waste nationally and up to 20–25 per cent in large urban centres such as Hanoi. The growing volume is placing increasing pressure on waste management systems and the urban environment, but it also creates opportunities for recycling and the development of green construction materials. However, wider adoption of recycled construction materials continues to face obstacles, including inconsistent material quality, limited waste sorting at source, high transport and processing costs, and an underdeveloped regulatory framework.
Businesses refunded more than VND 700 million in environmental restoration deposits
Son La’s Environmental Protection Fund refunded more than VND 700 million in environmental restoration deposits to two mining companies after they completed mine closure and environmental rehabilitation obligations. The refunded amounts included both principal deposits and accrued interest accumulated during the deposit period. Under Vietnam’s environmental regulations, mining firms are required to place restoration deposits to ensure sufficient funding for land rehabilitation and environmental recovery after extraction activities end. The refunds reflect efforts to strengthen accountability in the mining sector by linking resource exploitation with legally enforced environmental restoration responsibilities, while also reinforcing transparency and compliance within environmental governance procedures.
Quang Ninh gives nod to first offshore wind power plant
Vietnam will require producers and importers to contribute financially to recycling activities based on the volume and type of waste generated by their products and packaging under extended producer responsibility (EPR) regulations. Businesses that do not directly organise recycling activities will need to contribute to the Vietnam Environmental Protection Fund. The policy is intended to shift part of the environmental costs of waste management from the state to businesses, while encouraging greener production and more recyclable packaging. Although the framework may raise compliance costs for manufacturers and consumer goods firms in the short term, it could also support the development of recycling industries and strengthen Vietnam’s broader transition toward a circular economy.
Expanded hydropower seen as strategic solution toward Net Zero
Vietnam is increasingly viewing expanded hydropower projects as a strategic component of its pathway toward net-zero emissions by 2050. Rather than building entirely new dams, the approach focuses on upgrading and expanding existing hydropower infrastructure to increase flexible generation capacity while limiting environmental and land-use impacts. The expanded Ialy Hydropower Plant, which added 360 MW of capacity by utilising existing reservoirs and transmission systems, is presented as a model for improving system efficiency and supporting the integration of variable renewable energy such as wind and solar power. The strategy also reflects broader efforts to mobilise green finance and optimise existing infrastructure amid rising electricity demand. However, hydropower expansion will likely need to be integrated carefully with transmission upgrades, energy storage and environmental management to balance energy security with sustainability objectives.
Competition is no longer only about price and quality, but also about being green
Vietnamese manufacturers are facing growing pressure to adopt greener production practices as international markets increasingly require ESG standards, carbon data transparency and environmentally compliant supply chains. Industries such as paint, plastics and rubber are being pushed to reduce emissions, improve chemical safety and invest in cleaner technologies amid tightening environmental regulations from 2026 onward. Green transformation is becoming less a voluntary strategy and more a prerequisite for maintaining export competitiveness and access to global supply chains.
The shift reflects broader changes in international trade, where environmental performance is increasingly treated as a core component of industrial competitiveness alongside price and product quality. However, the transition may be particularly challenging for small and medium-sized enterprises because of high investment costs, technological barriers and limited institutional capacity. At the same time, businesses that adapt successfully could gain stronger long-term positioning in global markets increasingly shaped by decarbonisation and sustainability standards.
Capital challenges hinder green transition in industrial manufacturing
Vietnamese industrial manufacturers are facing growing financial pressure in pursuing green transition as stricter environmental standards, carbon reduction requirements and ESG expectations increasingly shape global supply chains. Many firms, particularly small and medium-sized enterprises, struggle to access long-term financing for investments in cleaner technologies, energy efficiency upgrades and low-carbon production systems because green projects often require high upfront costs and long capital recovery periods. The challenge reflects a broader tension between decarbonisation goals and industrial competitiveness, especially as exporters face rising pressure from mechanisms such as carbon border adjustment policies and sustainable sourcing standards. Although green finance and preferential credit programmes are expanding, limited institutional capacity, unclear classification standards and financing risks continue to constrain the pace of industrial green transformation.
Building green cities through better waste management
Rising volumes of household waste are placing increasing pressure on Hanoi’s urban infrastructure and environment, prompting calls for a more modern, circular and technology-driven waste management system. Policymakers and experts argue that waste management should be treated as a core component of green and smart urban development rather than a standalone sanitation issue. The proposed approach emphasises waste sorting at source, greener collection and transport systems, modern recycling and waste-to-energy technologies, and stronger digital integration in waste management operations. The discussion reflects a broader shift in Vietnam’s urban development strategy, where environmental infrastructure is becoming increasingly linked to urban competitiveness and quality of life. However, achieving greener cities will likely require not only investment in infrastructure and technology, but also stronger community participation and long-term behavioural change in waste sorting and consumption practices.
Ministry establishes monitoring framework for carbon market
Vietnam’s Ministry of Finance has issued a new circular establishing a monitoring and reporting framework for greenhouse gas emission quota transactions and carbon credit trading on the domestic carbon exchange. The framework is intended to create a synchronised and transparent legal foundation for the operation of Vietnam’s emerging carbon market, which forms part of the country’s broader roadmap toward net-zero emissions by 2050. Under the new regulations, transactions will be conducted through a carbon trading system linked to the national registration system, while monitoring mechanisms will oversee trading activities and reporting obligations. The move reflects broader efforts to formalise carbon pricing mechanisms, strengthen market governance and prepare Vietnam’s domestic carbon market for future expansion and potential international integration.
70,000 tonnes of rice granted low-emission green Vietnamese rice label
Around 71,000 tonnes of rice have been certified under the “Low-Emission Green Vietnamese Rice” label over the past two years as part of Vietnam’s programme to develop one million hectares of high-quality, low-emission rice cultivation in the Mekong Delta by 2030. Certified rice must meet traceability requirements and comply with low-emission production standards verified by local authorities or accredited organisations. The initiative reflects Vietnam’s broader effort to strengthen the sustainability and international competitiveness of its rice sector amid rising global demand for environmentally certified agricultural products. The programme is also intended to reduce greenhouse gas emissions, improve production efficiency and support greener agricultural development while helping Vietnamese rice move into higher-value export markets.
Biofuel ready for nationwide rollout
Vietnam is preparing for the nationwide rollout of biofuel as part of broader efforts to reduce transport emissions, strengthen energy security and diversify fuel sources. Authorities and businesses argue that biofuel can help lower dependence on fossil fuels while utilising existing fuel distribution and vehicle infrastructure, making it a relatively practical transition option compared with fully electrified transport systems. The expansion is also expected to support agricultural value chains by increasing demand for biomass feedstocks and waste-based raw materials. However, scaling up biofuel use will likely require stable supply chains, clearer policy incentives and stronger coordination between fuel producers, distributors and regulators to ensure commercial viability and long-term sustainability.