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Among the facilities piloting the allocation of greenhouse gas emission quotas for the 2025–2026 period, 51 of 61 domestic cement producers fall within the scope. Cement is one of three industries selected for piloting quota allocations for greenhouse gas emissions.
For 2025–2026, 51 of 61 cement companies are within the scope. The sector’s quota share accounts for about 28.8% of the total national quota in 2025 and 28.1% in 2026.
In 2025, cement production is expected to reach around 96.36 million tonnes. The allocated emission quota is 69.94 million tonnes of CO2 equivalent, while actual emissions are projected to reach around 84 million tonnes of CO2. This indicates a significant gap between the pilot quota and the sector’s projected emissions.
Despite decarbonization being on the agenda for more than 20 years, many enterprises have only recently begun to approach it. Some units have not yet built internal capacity and still rely on external consultants to conduct greenhouse gas inventories.
A key constraint is the scale of investment required for technology upgrades. More than 80% of cement production comes from large-scale plants, with investments ranging from hundreds of millions to billions of USD. Upgrading production lines or replacing major equipment in already stable operating systems requires substantial financial resources.
In an environment where economic pressure is not yet strong—such as when emission quotas are not clearly tied to compliance costs or penalties—many enterprises have not actively transformed.
Even with maximum operational effort, the emission reduction ceiling is shaped by three main emission sources in cement production.
Therefore, even after optimizing operations, an “emission floor” of about 525 kg CO2 per tonne of clinker remains. Deeper reductions require two main levers: lowering the clinker factor and gradually deploying carbon capture technologies such as CCS/CCU.
Reducing the clinker ratio in blended cement is described as the most effective lever in the short and medium term because it directly cuts emissions that make up the largest share across the value chain.
To implement this effectively, several prerequisites are needed: a stable supply of mineral admixtures (such as blast furnace slag, fly ash, pozzolanic materials or LC3 calcined clay), robust standards and technical regulations, and market acceptance of the product.
At the same time, a balance must be struck between emission reduction commitments under international accords and the growth needs of the economy and the competitiveness of enterprises.
A staged rollout is proposed based on technology readiness and compliance costs, with three main stages:
Focus on “no-regret” options such as optimizing heat and electricity use, utilizing waste heat to generate power (WHR), digitizing operations, and increasing the share of alternative fuels. These measures can be implemented immediately and deliver economic benefits through energy cost reductions.
Expand low-carbon cement materials and promote new binders such as geopolymer or belite clinker in suitable segments. Measurement, reporting, and verification (MRV) infrastructure and carbon pricing mechanisms should also be improved and operated effectively.
When carbon capture technologies such as CCS/CCU and financial infrastructure are mature, large-scale deployment can proceed to address remaining hard-to-abate emissions. However, research and preparation should start now, with investment planned to ensure enterprise resilience.
Using waste as an energy substitute is cited as a recent bright spot. About 15–16 plants have accelerated this solution in the last 4–5 years, following an earlier implementation by Holcim (now INSEE) about 18 years ago.
Using waste as substitute fuel reduces reliance on fossil fuels and helps address environmental issues. However, a fair policy framework is still lacking. Globally, waste use to reduce methane emissions from landfills is counted and credited in emission quotas, but in Vietnam guidance remains unclear, leading enterprises to hesitate on large-scale investment.
The recommendation is for the Government to issue detailed guidelines to provide a basis for enterprises to invest with confidence and use this solution effectively.
Transition plans need to be linked to the market. Communications should be intensified to gradually form a habit of using “green” cement with low clinker content.
A positive signal is the shift from the cement sector to concrete production. Many professional concrete firms have recognized economic benefits from using cement with lower clinker content in blends, reducing costs and improving profit margins.
Export market pressure—particularly from Australia and Europe—along with the CBAM (Carbon Border Adjustment Mechanism), is also forcing changes to maintain competitiveness. If low-emission cement can be produced, it can serve as a “ticket” to access markets with higher requirements.
For associations, the plan is to engage directly with each enterprise to guide emissions calculation methods and explain and disseminate relevant regulations in directives and decrees. Associations are also prepared to conduct in-depth studies to support policy recommendations.
For the Government, recommendations include issuing specific guidelines on calculation and crediting for alternative fuels, and supporting awareness and technical capacity so enterprises can inventory and manage emissions actively. The allocation mechanism should also be flexible and aligned with production realities.
In addition, there is a need to develop genuine green finance packages, such as preferential credit, favorable interest rates, or tax incentives for emission-reducing projects (including power generation from waste heat and waste treatment). More importantly, emission reductions must go hand in hand with maintaining competitiveness and economic efficiency.
If implemented effectively, the transition is framed not only as compliance pressure but also as an opportunity to restructure the cement industry toward modern, sustainable development and improve access to high-standard markets such as Australia and Europe, where carbon adjustment mechanisms like CBAM are being implemented.
The full article is published in Vietnam Economic Journal issue 17-2026, issued on 04/05/2026.
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