Recent Energy Developments in Vietnam - Vietnam-U.S. Partnership on Energy, AI, and Data Centers and Carbon Market Trial

PetroVietnam, Vietnam’s state-owned national oil and gas company, signed a MoU with US developers on energy technology transfer and digital transformation in oil and gas and electricity sectors. PetroVietnam also signed a cooperation agreement with American liquefied natural gas (LNG) exporters to provide energy for data center developers. These agreements were signed at a business forum attended by General Secretary and President Tô Lâm of Vietnam and co-hosted by the US-ASEAN Business Council on the 79th United Nations General Assembly’s sideline. This underscores Vietnam’s commitment to eliminating structural barriers for business operations and encouraging American investments in high-tech and sustainable development. The agreements aim to boost cooperation and development in coal plant conversion, digital infrastructure, and AI. With access to American companies’ cutting-edge technology, Vietnam’s energy and digital regulatory agencies can better progress toward their goals of ensuring sustainable development, support economic growth, and power the future of digital infrastructure. 

Around the same time, Hanoi also finished its draft on its compliance carbon market project, which it plans to trial from 2025-2028. Notable provisions include the restriction of sales to foreigners and a ban on international transactions except for carbon exchanges under international agreements. This is meant to build up the market nationally until it is fully operational in 2029 before considerations on connecting it with the international market will be made. Additionally, Hanoi hopes to reduce greenhouse gas emissions and develop Vietnamese companies in green technologies by boosting financing in this sector. Evidently, Hanoi is prioritizing the growth of a domestic carbon market over international integration, which could create a unique ecosystem for Vietnamese companies to develop expertise in carbon trading and green technologies. This may lead to the emergence of local champions in these sectors, which could become valuable partners.