Carbon credits with a high-integrity label are set to appear on the market not long after the first decisions on project methodologies are made in June, the Integrity Council for the Voluntary Carbon Market said May 2.
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Register NowCarbon crediting programs with a 98% share of the market now meet the high-integrity Core Carbon Principles labels, the governance body said in its latest announcement.
Verra, the world's largest issuer of carbon credits, received the high-integrity CCP label after it made significant changes to its Verified Carbon Standard, the world's largest crediting program. The Architecture for REDD+ Transactions (ART) body, which runs the TREES standard, and operates in 16 countries, was the fifth program deemed as CCP-eligible. This comes as the American Carbon Registry, Climate Action Reserve and Gold Standard were approved on April 5.
"[This] announcement shows our assessments are making good progress and we are confident that CCP-labelled credits will soon be available to corporate buyers," said ICVCM chair Annette Nazareth. "While companies' first priority must always be to make rapid cuts to their own emissions, buying high-integrity credits allows them to go further and take responsibility today for emissions they cannot yet cut."
Quest for integrity
This integrity initiative comes at a critical time for the voluntary carbon market as growing scrutiny on the varying quality of offsets and projects has affected prices and liquidity.
Platts, part of S&P Global Commodity Insights, assessed nature-based avoidance carbon credits at $3.70/mtCO2e on April 15, a fall of almost $2.50/mtCO2e from the same time last year.
But many market participants and analysts are hopeful that the confidence will return once these integrity initiatives start to be adopted.
ICVCM, which is tasked with setting threshold standards for high-quality carbon credits, has come up with CCP labels and an assessment framework to help define high-integrity carbon offsets.
CCP-labeled credits are now on track to appear on the market once the ICVCM has approved methodologies used by CCP-eligible programs, with first decisions on these expected next month.
"The volume of CCP labelled credits is expected to grow steadily over 2024 as assessments are completed and decided upon by the Governing Board and it expects to have largely completed assessment of these categories by the end of September," the ICVCM added.
CCP-eligibility signals that the programs and methodologies meet the standards for effective governance, transparency, tracking and robust independent third-party validation and verification.
Other remaining programs that applied for eligibility include Isometric, Social Carbon and Puro.earth.
Project categories
The Integrity Council has grouped more than 100 methodologies into 29 categories for assessment, which cover more than half the issued volume of credits in the market.
The first methodologies that will be approved are likely to be either from those that were fast-tracked internally or those that were assessed by the first three multi-stakeholder groups.
Only 6.1% of credits will be assessed internally, which cover categories that include projects related to methane from mines and landfill sites, detecting and repairing leaks in gas systems and destroying chemicals that damage the ozone layer.
The first three multi-stakeholder working groups have finished their work, and these categories of credits are expected to be decided in the coming months, according to the ICVCM.
Categories include improved forest management, sustainable agriculture, rice cultivation methane avoidance, nutrition, nitrogen management, buffer practices and afforestation, reforestation and revegetation, grid connected renewable energy, mini-grids and renewable energy.