Masan High-Tech Materials begins journey towards carbon neutrality

The world is experiencing resonance effects at a worse level and scale than ever from the three disasters of the COVID-19 pandemic, climate change, and natural resource scarcity, leading to major consequences on many aspects of the current and future life.

The last five years have been the “warmest” period recorded on earth, especially the year 2020, when the highest levels of CO2 were measured in the atmosphere. Carbon neutrality is now a critical commitment for all.

Carbon neutrality is an internationally recognised target for humanity to be more environmentally responsible for the unavoidable CO2 emissions in daily life as well as in business activities. Simply, carbon neutrality means that one tonne of emitted CO2 will be balanced by an equivalent amount being removed at a different place. This can be implemented through calculating carbon credit to invest in projects of minimising CO2 emissions all over the world. That is the quickest way to reduce CO2 emissions in the atmosphere and the only way to neutralise carbon.

At Masan High-Tech Materials, we focus on the efficient use of conventional sources and renewable sources for self-generated energy, which are the key leverage for the company to realise its carbon neutrality goal.

Based on the mutual frame of sustainable development objectives by the United Nations and the Paris Agreement on climate change, Masan High-Tech Materials had its initial approaches to the journey towards carbon neutrality as follows.

Calculating and re-auditing greenhouse gas inventory

Recently, the company has reviewed, calculated, and re-audited its inventory of greenhouse gas emissions from energy consumption in accordance with the guidelines of the Intergovernmental Panel on Climate Change framework with a direct range (coal, gasoline, and oil consumption) or indirect range (power consumption). In the coming time, the company will continue to complete the greenhouse gas inventory in other fields such as wastewater treatment, waste disposal, and even negligible emissions such as printing.

Developing solar farm at Nui Phao mine

Green power and clean energy are necessary solutions to improve carbon neutrality. Currently, the company has worked with several partners to seek development opportunities and install a solar farm at Nui Phao mine. This project has great significance and feasibility to be implemented in alignment with the company's energy consumption strategy in the next 5-10 years.

Environmental restoration and reforestation in Thai Nguyen province

Since the tungsten-polymetallic Nui Phao mine (at Dai Tu district of Thai Nguyen province) was exploited, the company has planted dozens of hectares of Acacia trees under the environmental restoration and rehabilitation programme, which not only minimises the impact of pollution sources from mining and mineral processing activities but also acts as important carbon absorption sinks.

In addition, the company will monitor to calculate the amount of carbon absorbed from the area of ​reforestation in Dinh Hoa district, Thai Nguyen province. Since 2018, the company has deposited VND1.5 billion ($65,220) to Thai Nguyen Forest Protection and Development Fund for reforestation of 26.7ha of forests which has been compensated for land clearance to implement Nui Phao project.

Thai Nguyen Forest Protection and Development Fund has used this amount of money to plant 50ha of protective forest and special-use forest at Bao Linh, Dinh Bien and Phu Dinh commune in Dinh Hoa district, Thai Nguyen province. The trees planted and protected in that forest area are cinnamon, Erythrophleum fordii, Chukrasia, and other regenerated woody plants, which are currently growing and increasing canopy very well.

The company has coordinated with Thai Nguyen Forest Protection and Development Fund to collect information, calculate the carbon absorption capacity through planted forest areas, and also work on researching investment cooperation programmes on afforestation in the future in Thai Nguyen province.

Based on initial calculations, the amount of cumulative CO2 from the planted forest areas under the annual plan on environmental restoration and rehabilitation and the areas of reforestation in Dinh Hoa district is around 5,736 tonnes. Carbon offset by planting as a bridge solution needs to be focused on towards the goal of carbon neutrality and climate balance.

Investment in reforestation to sell carbon credits

Carbon credit is a permit issued by the government or other regulatory agency that allows the credit holders to emit greenhouse gases (converted to CO2). Each credit is equal to 1 tonne of CO2 equivalent, carbon credit can be exchanged or traded amongst participants joining the carbon market.

Accordingly, the forest carbon credit is determined by calculating CO2 absorption capacity in the atmosphere through the forest biomass. Vietnam is identified as one of the potential countries in terms of selling forest carbon credits.

On November 22, 2020, Vietnam signed an agreement with the World Bank’s Forest Carbon Partnership Facility (FCPF). Vietnam is expected to sell approximately 10.3 million tonnes of CO2 through the REDD+ program (Program of reducing greenhouse gas emissions from deforestation and forest degradation) for the period of 2020-2025 in six provinces in the North Central region. According to the calculations, Vietnam can sell up to 50 million forest carbon credits and earn VND trillions every year.

Up to now, Vietnam has not had any investment projects for conducting business, trading forest carbon credits from the REDD+ programme between a foreign enterprise with a Vietnamese organisation/individual. Thus, the government approved Quang Nam province to implement a pilot project on trading forest carbon credits from the REDD+ programme with the pilot period from 2021-2025. The success of the pilot project will bring huge opportunities to other provinces in Vietnam.

Currently, Masan High-Tech Materials is closely monitoring the development and implementation progress of the carbon credit market in Vietnam, as well as completing the legal framework to orientate this activity so that the company will be ready to take the lead in participating in the carbon credit market, contributing to the common goal of reducing greenhouse gas emissions and protecting the environment.