Almost all types of onions, and even shallots can be caramelized. While some people prefer the sweeter varieties, like Vidalias, others go for less sweeter onion types. If you like the sweeter onion varieties, then you may use Walla walla, Vidalia, Texas sweet, Mayan sweet, Oso sweet, sweet imperial, Maui, etc. Otherwise regular yellow, red, or white onions will do. It is also said that large onions with a mild flavor are best for caramelizing.