Uncategorized – Page 62 – The Global Carbon Fund

Microsoft Buys Carbon Removal Credits from Grassroots Carbon

February 8, 2024/in Uncategorized /by

Microsoft has entered into an agreement with Grassroots Carbon, a leading provider of high-quality carbon removal credits, to purchase soil carbon drawdown credits. This marks Microsoft’s first investment in carbon credits generated from regeneratively managed grasslands.

The credits represent additional carbon sequestration over a 30-year period and support regenerative ranching practices.

Grassroots Carbon offers nature-based soil carbon removal solutions to entities wanting to reduce their carbon emissions. The company also provides ranchers an easy, transparent way of rewarding their regenerative practices through carbon credits.

Digging Deeper: The Role of Grasslands in Carbon Sequestration

Grasslands play a crucial role in combating climate change by serving as effective carbon storage reservoirs. They surpass other ecosystems primarily due to the unique rooting characteristics of their vegetation. Adapted to frequent fire and grazing, these systems have evolved with deep root systems essential for their carbon storage.

Source: Yongfei Bai et al, Grassland soil carbon sequestration: Current understanding, challenges, and solutions, Science (2022). DOI: 10.1126/science.abo2380

Remarkably, grasslands and shrubland carbon stocks constitute 34% of the total carbon in the U.S. Great Plains region.

The extensive root systems of native grassland species can reach the depths of up to 15 feet. Estimates further suggest that 60% of soil carbon sequestration in grasslands is happening between 1 to 3 feet.

Surprisingly, the majority of the biomass of these native species is located below ground. About 90% of the carbon that grasslands store is in their soil and roots.

The significance of deep root systems extends to the deposition of carbon into deeper soil layers, a critical factor as the rate of carbon sequestration tends to increase with soil depth.

Global studies also suggest that up to 7.3 billion tons of carbon dioxide equivalents (CO2e) per annum could be captured with grassland diversity restoration initiatives. Plus, another 699 million tons of CO2e per year can be sequestered in pasture through improved grazing management.

Unearthing Grassroots Carbon’s Impact

Brad Tipper, CEO of Grassroots Carbon, expressed excitement about Microsoft’s inclusion of soil credits in their carbon removal strategy. He emphasized the importance of soil carbon storage as a crucial element of the climate solution.

Improved soil health not only contributes to carbon reduction but also provides benefits such as enhanced water storage, erosion prevention, and improved grasslands ecology.

The investment in carbon credits directly supports ranchers implementing regenerative land management practices. Most of the profit from credit revenues will go to these land managers.

Currently, 40% of U.S. grasslands are for livestock grazing, with the potential to sequester over 500 million tons of carbon dioxide annually. However, 95% of these grasslands are under conventional management which depletes soil carbon.

This is where Grassroots Carbon comes in to change that. The company aims to facilitate the transition to regenerative practices by offering opportunities for land managers to earn income from carbon storage.

The project uses rigorous measurement, reporting, and verification (MRV) processes. It is employing PastureMap software to incentivize ranchers’ transition to rotational grazing.

Microsoft sees this collaboration as part of its carbon removal strategy, contributing to the advancement of the soil carbon market through MRV innovations and the generation of large datasets of soil carbon and ecological data.

Brad Tipper highlighted the importance of the deal which impact goes beyond carbon.

“Soil carbon storage is an essential part of the climate solution, and our regenerative ranchers are trusted partners in that solution… Microsoft not only made a choice to reduce atmospheric carbon levels, but to do so with impacts far beyond just carbon.”

However, the parties didn’t disclose how much the credit costs and how many credits Microsoft would buy.

Still, their groundbreaking collaboration signals a shift towards prioritizing soil carbon storage in climate strategies. By supporting regenerative ranching practices, this partnership not only reduces carbon emissions but also fosters ecosystem health and resilience.

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Why Lithium Prices are Plunging and What to Expect

February 8, 2024/in Uncategorized /by

Many investors are puzzled by the plunging lithium stock prices, especially considering the anticipated long-term demand. Let’s look into why this is the case and what is the market outlook for 2024/25.

The Steep Decline in Lithium Prices

The current decline in lithium prices can be primarily attributed to the slowing growth of electric vehicle sales in China. This is coupled with the broader slowdown in the Chinese economy.

Source: Trading Economics

As demand remains sluggish at previous pricing levels and supply surpasses demand, prices have inevitably fallen.

Lithium carbonate prices have experienced a significant decline in China. They dropped from a record high of $81,360 per tonne in November 2022 to $20,782 per tonne in the current month. This marks the lowest level in two years, reflecting a 67% decrease year-on-year.

In response to the plummeting prices, Chinese refining companies are taking measures such as cutting production or suspending operations.

The sharp decline in lithium carbonate prices represents a nearly 75% correction. Market analysts attributed this to a series of negative catalysts that have suppressed lithium prices.

What Makes Lithium Price Volatile?

It’s essential to recognize that lithium stock prices have historically been volatile in the short term due to various factors.

Lithium is a specialized commodity produced in limited quantities, making supply disruptions a significant factor in price fluctuations. Moreover, changes in consumer trends, particularly in consumer electronics and EVs, can swiftly impact demand and supply.

RELARED: Lithium: The White Gold Powering up the EV Revolution

The lithium market is also influenced by geopolitical conditions and regulations, which can alter demand dynamics. Also, advancements in technology have introduced new extraction techniques, affecting total supply and prices.

There is also potential for increased involvement from major oil and gas companies. This is evidenced by recent statements from CEOs of Exxon and Chevron expressing interest in the lithium industry.

Additionally, a large private energy company Lowry is advising is exploring investments in lithium assets to support the global energy transition.

Although China has historically dominated lithium supply from Australia, the rise of Western converters is expected to redirect more Australian supply to Europe and North America. This shift may challenge China’s market dominance as the Western supply chain expands.

Point in case is Canada positioning itself to contribute to meeting the North American lithium requirements. This is where a junior Canadian lithium company, Li-FT Power (LIFT: LIFFF), comes into play.

The company focuses on consolidating and advancing hard rock lithium pegmatite projects in Canada, especially in known lithium districts. Li-FT Power is committed to advancing the exploration and development of high-quality lithium assets in the country.

Powered by Lithium: The Electrifying Role of EVs

Strategic investments to secure future lithium supply are on the rise. Major automakers and lithium producers are already committing over $1 billion in 2023 alone.

For instance, GM invested $650 million in Lithium Americas, while Albemarle allocated $110 million to lithium developer Patriot Battery Metals. This trend is expected to continue as companies seek to safeguard their access to raw materials for batteries.

The EV market is still in its early stages, with significant room for growth. As EV penetration increases globally, demand for lithium will outstrip supply, especially as EVs become mainstream.

Since batteries constitute a significant portion of EV expenses, this presents an opportunity for EV manufacturers to either increase profits per vehicle sold or, more likely, reduce prices to remain competitive as rivals do the same. Lower prices tend to attract more buyers, leading to increased demand for lithium.

Consequently, as the current oversupply diminishes, the price of lithium is likely to rebound. This cycle of falling prices leading to increased demand, followed by a reduction in supply, underscores the cyclical nature of the lithium market.

Short-Term Challenges and Long-Term Outlook

Despite short-term volatility, the long-term forecast for lithium remains positive. Lithium is crucial for decarbonization efforts, especially in the EV sector.

The global demand can surpass 2.4 million metric tons of lithium carbonate by 2030, doubling the 2025 forecast. BloombergNEF projects nearly a 5x increase in global lithium demand by the end of the decade, driven by rising battery demand for electric vehicles.

In the short-term, Goldman Sachs maintains a pessimistic outlook for lithium prices in 2024. The brokerage firm projects further declines compared to current levels.

The broker anticipates this downward pressure in lithium prices this year due to oversupply.

Initially predicting a return to market deficit in 2024, analysts now suggest a longer timeline, with the lithium market potentially bottoming out in 2025. Thus, Goldman Sachs maintains a bearish view on the market, adjusting their 12-month targets downward for China Lithium Carbonate and CME Asia CIF Lithium Hydroxide.

Known for its accurate forecasts, Goldman Sachs estimates the following prices for 2024:

Lithium carbonate: $13,377 per tonne
Lithium hydroxide: $14,263 per tonne
Spodumene 6%: $1,250 per tonne

As per S&P Global estimation, lithium prices will start to stabilize beginning in 2025 as surplus narrows down. From there, prices would start to rise up again as seen below.

Amid current market challenges, the commitment to global net zero emissions by 2050 is expected to drive continued demand for lithium. More notably, long-term prospects remain strong fueled by growing EV adoption and global decarbonization efforts.

Disclosure: Owners, members, directors and employees of carboncredits.com have/may have stock or option position in any of the companies mentioned: LIFFF

Carboncredits.com receives compensation for this publication and has a business relationship with any company whose stock(s) is/are mentioned in this article

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Carbon Footprint Controversy For Taylor Swift Ahead of Super Bowl LVIII.

February 6, 2024/in Uncategorized /by

As the countdown to Super Bowl LVIII begins, Taylor Swift finds herself soaring not only in the charts but also in environmental debates. In recent weeks, scrutiny has intensified on American singer-songwriter’s footprint from her private jet travels.

An estimation shows that the popstar’s flight to the event, where her love interest Kansas City Chiefs tight end Travis Kelce would be playing, will pollute 14x the average American household emissions in one year.

Swift’s sky-high carbon emissions from her private jets brewed interest at Chiefs games with her frequent travels. The pop culture icon joins a list of celebrities facing criticisms for private jet travel amid growing concerns about planet-warming carbon emissions.

Taylor Swift’s Super Bowl Travel Footprint

The hitmaker, who broke chart records with her Eras Tour grossing over $1 billion, becomes even more popular because of her $40M-private jet’s emissions. This kind of transport is known to be the most polluting, creating a major challenge in global decarbonization efforts.

Compared to other transportation modes, private jet emits 2 metric tons per hour per person. A U.S. domestic commercial flight releases just 0.04 metric tons of CO2.

Source: Beatriz Barros & Richard Wilk (2021). The outsized carbon footprints of the super-rich, Sustainability: Science, Practice and Policy. Graphics by BuzzFeed News.

Swift is the world’s most carbon polluting celebrity in 2022, per digital sustainability consultancy study. Their results show that Swift had flown 170 times since January that year, equivalent to 22,923 minutes in the air.

If the popstar attends the Super Bowl in Las Vegas, she would be coming from Tokyo where she’s on tour. That would mean flying over 19,400 miles in under 2 weeks via her private jet to support Travis Kelce. The Chiefs player is America’s most Googled NFL player in the run up to the big game.

The flights are estimated to emit more than 200,000 pounds of CO2, according to Gregory Keoleian. He’s a co-director of the Center for Sustainable Systems at the University of Michigan.

That’s roughly 14x the average annual emissions of an American household, per data from the U.S. Energy Information Administration.

The controversy underscores the broader issue of the environmental impact disparities between the wealthy and lower-income individuals. And Swift isn’t the only A-lister to be spotlighted for globe-trotting.

In another analysis by The Guardian, 200 rich people, including business tycoons and celebrities, emitted over 415,500 tons of carbon from making over 44,700 flights in 2023. In perspective, that’s equal to the average annual emissions of 40,000 British people.

Included in the study are famous businessmen like Elon Musk and music veterans like The Rolling Stones.

Professional Sports and Carbon Offsets

Taylor Swift’s Super Bowl flight emissions is just a fraction of the event’s massive carbon footprint. Think about the competing teams’ own travel emissions and that of the spectators’. Then add in the emissions of hosting the event, including the arena’s energy use and the accommodations’ emissions.

More remarkably, the carbon footprint of the digital ads linked to the Super Bowl is huge. The 10 most popular ads for the most-watched U.S. sporting event stands at 422 tons of CO2. That’s roughly equivalent to 2,800 flights from Philadelphia to Kansas City. Both cities were part of last year’s Super Bowl LVII.

Other major events, including the Olympic Games and the U.N. climate summit, also face criticisms for their significant footprint. All air travel contributes to climate change, with private jets notably producing much higher emissions per person. They emit at least 10x more carbon per passenger compared to commercial planes.

In an era where a substantial carbon footprint is viewed as a reputational concern for public figures, celebrities and high-profile figures have taken substantial steps to address their carbon emissions and communicate these efforts to the broader public.

Swift opted to use carbon offsets to compensate for her private jet’s huge carbon footprint. Prior to the singer’s move, the Houston Texans of the National Football League (NFL) had also bought carbon credits to offset their air travel’s emissions.

A-Gas and SusGlobal Lead the Way in Pioneer Carbon Credit Initiatives

February 2, 2024/in Uncategorized /by

In a groundbreaking move towards environmental responsibility, A-Gas, a pioneer in refrigerant lifecycle management, has received approval for Ecology Offset Credits from the Washington State Department of Ecology, a key regulatory authority in the state’s carbon market compliance. Simultaneously, SusGlobal Energy Corp. is making waves with its composting offset project in Ontario, selling Verified Emission Reductions and Removals (VERRs).

These initiatives underscore a commitment to sustainability and innovative solutions to combat climate change.

A-Gas (US) is a trading subsidiary of A-Gas International, the world’s biggest refrigerant recovery and reclamation company. It focuses on providing environmental solutions and lifecycle management services for ozone depleting substances and global warming agents.

Revolutionizing Refrigerant Recovery Through Carbon Credits

Utilizing their Rapid Recovery on-site refrigerant recovery service and Rapid Exchange on-demand cylinder swap service, along with collaboration with distributor partners, A-Gas collected refrigerant gasses from Washington State.

The collected gasses were then treated in A-Gas’ proprietary PyroPlas® plasma arc destruction units. It is the only technology of its kind in the U.S. approved for carbon offset generation.

PyroPlas® ensures the cleanest end-of-life treatment, achieving a remarkable 99.9999% efficiency in destroying Ozone Depleting Substances with minimal emissions. It also has no adverse environmental impacts.

The Department of Ecology has issued 109,180 Ecology Offset Credits to A-Gas. These credits can be used by covered entities in Washington to meet their emission reduction obligations under the state’s program.

American Carbon Standard (ACR) served as the Offset Project Registry, issuing serialized Registry Offset Credits for conversion into Ecology Offset Credits. The project adhered to the California Air Resources Board Compliance Offset Protocol for Ozone Depleting Substance Projects, adopted by the Washington Department of Ecology for generating the Registry Offset Credits.

Brooke Willard, Carbon Program Director for A-Gas, expressed pride in being among the first project developers for Ecology Offset Credits. A-Gas aims to manage refrigerant lifecycles effectively, contributing to environmental protection and enhancement.

Willard further added that:

“With the issuance of these credits, A-Gas is providing Washington organizations with a transparent mechanism to build a more sustainable future.”

A-Gas ambitiously aims to reach net zero emissions by 2035. The company also has a goal of reducing its existing emissions by 50% by 2028.

Over in Canada, a composting offset project has generated carbon credits called Verified Emission Reductions and Removals (VERRs).

Turning Waste into Gold

SusGlobal Energy Corp., an environmental, agricultural and industrial biotechnology company, has sold 3,000 VERRs as part of the SusGlobal Belleville Composting Offset Project in Ontario. The company focuses on acquiring, developing, and monetizing a portfolio of proprietary technologies in the waste to energy and regenerative product applications globally.

This new sale brings the total number of carbon credits sold by the company to an impressive 42,302. Anew Climate, formerly known as Blue Source, developed the project.

A noteworthy achievement of the project is its contribution to the increased diversion of organic waste from landfills. This significantly helps in mitigating methane generation.

Methane, a potent greenhouse gas, is 28x more effective at trapping heat energy in the atmosphere than carbon dioxide. By diverting waste from landfills, the composting offset project addresses this environmental concern, benefitting both the community and the climate.

In 2021, Canada’s waste-sector methane emissions were 21 metric tons of CO2e or 0.96 metric tons of methane. It accounts for nearly 22% of the total methane emissions in the country in 2020, as seen below.

Source: Library of Parliament

The demand from municipalities to divert organic waste from landfills remains strong. Composting facilities with sustainable management practices are crucial in this waste redistribution process.

Ontario is planning to ban food and organic waste in conventional waste sites under the Environmental Protection Act. This regulation helps unlock opportunities for waste reduction and innovative resource recovery throughout the value chain. This change is advantageous for SusGlobal, enhancing its infrastructure, assets, licenses, and capacity to produce lower-carbon options at existing facilities.

Fueling Composting for Cleaner Environment

SusGlobal Belleville operates as an aerobic composting facility, specializing in the processing of residential source-separated organic waste and industrial, commercial, and institutional organic waste into high-quality compost.

The facility collaborates with local municipalities, including the City of Belleville, County of Northumberland, the Municipality of Port Hope, the Township of Cavan Monaghan, and Prince Edward County, for waste collection.

Verified Emission Reductions and Removals (VERRs) associated with the composting offset project are validated by an independent third party.

Marc Hazout, Executive Chairman, President, and CEO of SusGlobal Energy Corp., expressed appreciation of this sale, saying that:

“We are pleased with the continued amounts that Anew has marketed and sold as part of our Company’s carbon credits monetization initiative, allowing us to generate additional revenues.”

The anticipated revenue from carbon credits would drive technological advancements, boosting the expansion of composting efforts not just at the SusGlobal Belleville facility but in other municipalities across North America. This underscores the company’s commitment to continuous innovation and environmental stewardship.

A-Gas secures Ecology Offset Credits from its refrigerant recovery and SusGlobal continues to thrive in carbon credit sales. Both companies show the transformative power of corporate responsibility in reducing carbon emissions and building a sustainable future.

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ICVCM Sets the Bar High with 100 Carbon Credit Methodologies Under Assessment

February 2, 2024/in Uncategorized /by

The Integrity Council for the Voluntary Carbon Market (ICVCM) has achieved a new milestone, announcing its plan to assess over 100 active carbon credit methodologies for adherence to the high-integrity Core Carbon Principles (CCPs).

The first decisions on these assessments are due by the end of March.

An expert group, including members of the Integrity Council’s Governing Board, its Expert Panel, and external stakeholders, has categorized similar carbon credit methodologies into 36 different groups. The groups will undergo three types of assessments based on their complexity and issues.

It was in August last year when ICVCM released its long-awaited Assessment Framework.

Types of Assessments for Carbon Credit Categories

The Core Carbon Principles (CCPs), comprising 10 fundamental tenets for high-integrity carbon credits, are supported by detailed criteria outlined in the CCP rulebook.

The issuance of high-integrity CCP-labeled credits could facilitate the flow of climate finance to Global South countries. This is essential in helping them achieve their national climate objectives.

These credits will enable buyers to identify and support top-notch projects that effectively reduce and remove emissions. Projects range from initiatives to safeguard and restore forests to the expansion of challenging-to-commercialize innovative clean technologies.

The Categories Working Group (CWG) has sorted carbon credits categories into one of three types of assessment:

Internal assessment:

Categories covering 8% of carbon credits in the market will be assessed internally by the Integrity Council secretariat and members of its Expert Panel. This includes methodologies such as:

capturing methane from mines and landfill sites,
detecting and repairing leaks in gas systems,
destroying ozone-depleting chemicals, and
reducing emissions of sulfur hexafluoride.

Multi-stakeholder assessment:

Categories covering 47% of carbon credits in the market will be assessed by Multi-Stakeholder Working Groups. These categories, including renewable energy, efficient cookstoves, improved forest management, and REDD+ (Reducing Emissions from Deforestation and Degradation in Developing Countries), raise complex issues in specific areas.

Considered by the CWG to be very unlikely to meet the criteria:

Categories covering 1% of carbon credits in the market, considered unlikely to meet CCP criteria, will be assessed once other evaluations are complete. These include new natural gas power, waste heat recovery, and industrial energy efficiency.

Major Programs Under Assessment

Programs have the discretion to exclude certain carbon credit methodologies from the assessment process.

Verra, for instance, introduced its new REDD+ methodology for evaluation while omitting its prior REDD+ methodologies, constituting 27% of the market credits. The organization has put forth only the latest versions of methodologies for specific project types. They’re developing a pathway to facilitate projects transitioning to these updated versions.

Here’s the status of the major programs under assessment:

An additional 6% of methodologies have either been excluded by other programs or represent older methodologies covering a limited number of credits in the market. Unallocated credits in the market would be due to various reasons. These include data inconsistencies, projects utilizing multiple methodologies, inactivity of some methodologies, and the pending categorization of certain small methodologies.

Carbon-crediting programs commanding a 98% market share have sought approval to use the CCP label. The secretariat is concurrently evaluating these programs alongside the assessment of categories.

Approved programs meeting the criteria will be authorized to display the CCP label on both existing and new credits from approved categories.

Annette Nazareth, Integrity Council Chair, said:

“The Core Carbon Principles establish a global benchmark for high integrity. We know buyers are eagerly awaiting CCP-labelled carbon credits. We are keen to ensure the labels reach the market as soon as possible while ensuring that we properly consider complex issues and make the right decisions.”

Marching Towards Integrity

The Integrity Council anticipates revealing the outcomes of its assessments by March. The organization has dedicated web pages on its site tracking the progress of all categories and programs undergoing assessment.

The Governing Board’s decisions, along with rationale, will be made public, accompanied by transparent explanations for any negative determinations.

It’s important to note that not all methodologies within a specific category may receive approval.

In cases where remedial action is necessary before program or category approval, or if approval is unlikely, affected programs will be notified. They will have the right to submit their input and participate in a hearing before any final decisions are made.

The Integrity Council’s efforts to instill integrity in carbon credits align with the Voluntary Carbon Markets Integrity Initiative (VCMI). VCMI focuses on ensuring integrity in credit use with the following claims type.

VCMI Carbon integrity claims

The VCMI’s Claims Code of Practice provides guidance to companies on using credits to make credible claims regarding their progress towards net zero commitments, emphasizing the need to purchase credits meeting the CCP quality threshold.

More notably, governments and regulators are increasingly considering the ICVCM’s CCPs as an international standard for incorporation into their frameworks. In particular, the UK has expressed intent to endorse the CCPs and explore their integration into policies, regulations, and guidance.

The Monetary Authority of Singapore is also actively exploring how to align its transition credits with the CCPs. In the US, the Commodity Futures Trading Commission has published draft guidance aligning carbon credit derivatives listings with the CCPs.

ICVCM reached a significant milestone geared to enhance the credibility of carbon credits, supporting climate finance in Global South countries and aiding buyers in identifying top-notch projects. The process involves internal and multi-stakeholder assessments, with approved programs displaying the coveted CCP label on their credits.

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CarbonPool Raises $12M in Seed Funding From Climate-Focused Investors

February 1, 2024/in Uncategorized /by

CarbonPool, a pioneering Carbon Credit Insurance Firm, positioning itself as the world’s first insurance company with a carbon credit balance sheet, has successfully concluded a $12 million funding round.

The climate-focused startup is co-founded by former Allianz executives. The funding round is led by Heartcore Capital and Vorwerk Ventures, including support from HCS Capital, and Revent Ventures.

The raise marks the largest European climate-focused seed funding round in over a year. Globally, it is the second-biggest seed funding in climate finance, highlighting significant interest for innovative approaches to carbon credits insurance.

The World’s First In-Kind Carbon Credit Insurance

In an era where companies heavily rely on carbon credits to achieve their net zero targets, the turbulence in carbon credit markets has marked the importance of credit integrity, rigorous risk underwriting, and assurance of real environmental gains.

CarbonPool addresses the need for such assurances by offering in-kind insurance to mitigate risks related to reaching net zero commitments. The carbon credit insurer will acquire high-quality carbon credits, keeping them on its balance sheet for future payouts.

This coverage extends to shortfalls, reversals, business interruptions, and natural disasters that might hamper the contracted carbon dioxide removals. It also applies to events that accidentally contribute to increased atmospheric CO2 levels such as wildfires.

Image from CarbonPool

The company’s interdisciplinary team, comprising insurance experts, climate scientists, weather modelers, geographers, and engineers, evaluates each risk to develop customized risk models.

Premiums collected from clients, combined with CarbonPool’s capital, are strategically invested in high-quality carbon removal projects. This unique approach ensures that claims can be in-kind, enhancing the credibility and reliability of carbon credit commitments.

A report by AlliedOffsets, covering 2000 to 2023, indicates a modest 45% average success rate in the issuance of carbon credits. This poses a significant challenge for corporate buyers striving to achieve their climate objectives.

Notably, current insurance offerings cover the assets underpinning carbon credits but don’t provide compensation for the credits’ real value. This is where CarbonPool’s in-kind insurance comes in to address the uncertainties and risks associated with carbon credit issuance.

Mitigating Climate Risks with CarbonPool’s Carbon Credit Assurance

Former regional CEO of Allianz Africa and Co-founder/CEO of CarbonPool, Coenraad Vrolijk, highlighted their unique approach to insurance, saying:

“CarbonPool’s in-kind payments make it unique among insurers in not only offering protection to holders of carbon credits in cases of natural disaster or technology breakdown but also in providing a guarantee that carbon credits live up to their promises, giving purchasers certainty and ensuring that they can meet their net zero goals.”

Christian Jepsen, a founding partner at Heartcore, emphasized the significant potential of insurance in the carbon trading space. He noted that while insurance typically constitutes 5-10% of mature markets’ revenue, it is just beginning to make an impact in carbon markets.

Participants in the carbon markets, where revenues will increase 4x to $2 trillion by 2050, have little access to these insurances. And the CarbonPool team aims to fill in this gap.

The insurer is actively progressing its insurance license application in Switzerland. Already engaging with clients, including corporations, institutional investors, and carbon removal developers, the company offers assessments and pre-underwriting agreements.

Additionally, CarbonPool is in talks with government bodies such as the United Nations and the State of California. The company is contributing insights on how insurance can effectively address key challenges within the industry.

Within the same tree but in a separate branch, climate focus startups are also attracting investors’ attention.

The Growing Support for Innovative Climate Solutions

Per Crunchbase data, investors are funding better, lower-carbon ships and boats. Their analysis reveals that companies focusing on reducing the carbon footprint of ships and watercraft have raised a total of over $1 billion.

The startups are using the funds to improve research and commercialization of electric motors, wind-powered ships, and other low-carbon ships.

For instance, Pure Watercraft, a startup providing battery-electric propulsion systems for boats, raised over $200 million in total equity funding. A French Ocean Zero portfolio company, Ayro, focusing on decarbonizing cargo ships through wind propulsion has closed over $32 million.

Climate tech startups and their backers continue to show that their carbon reduction innovations are here to stay. Despite the challenges ahead, they are driven by their visions to impact the industry and help in propelling the world towards net zero.

Fighting alongside these nautical startups is CarbonPool. The company’s successful funding round positions it as a key player in the emerging space of climate-focused startups. Together, they show the increasing recognition and support for innovative solutions addressing climate challenges.

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BlueLayer Secures $10M to Revolutionize Carbon Project Development

February 1, 2024/in Uncategorized /by

BlueLayer has secured $10 million in funding to support carbon project developers worldwide in bringing high-quality carbon credits to market.

The end-to-end software platform, operating in stealth mode since late 2022, raised the funds through seed and pre-seed investment rounds. The seed round is led by Point Nine, a prominent European B2B software-focused VC firm.

With head office in Berlin and teams in London and Athens, BlueLayer aims to help carbon project developers manage their carbon credits at scale. The company will use the funds to expand its platform features to address the emerging and complex needs of developers.

Targeting Quality Carbon Credits at Scale

The pathway towards Net Zero begins with companies with Science Based Targets and commitments. And thus, addressing their value chain emissions through decarbonization efforts is crucial. This is where BlueLayer’s mission comes into play.

The European startup focuses on assisting developers involved in various carbon projects, such as reforestation, forest conservation, peatland restoration, direct air capture, and enhanced rock weathering.

The platform aims to facilitate the connection between corporate leaders committed to Science Based Targets and project developers working on the ground to remove or avoid carbon emissions.

Experts predict that carbon markets need to scale significantly, reaching at least 20% of current global emissions or around 10 gigatons by 2050, representing a 40x increase from their current size.

McKinsey & Company projected an increase in global demand for voluntary carbon credits of up to 100x compared to 2020 levels, as seen below. BlueLayer seeks to contribute to this expansion by supporting developers in scaling carbon projects beyond value chain mitigation efforts.

On the demand side, buyers are willing to pay a premium for high-quality carbon credits, supported by reliable data.

A report by Ecosystem Marketplace in December last year shows a revealing trend within the voluntary carbon market. It highlighted that despite their higher price, demand concentrates toward high-integrity and high-quality carbon credits. These credits often offer other benefits that go beyond curbing carbon emissions.

Transforming Carbon Project Development

To date, there are over 177 million carbon tonnes managed on BlueLayer’s platform.

The startup, co-founded by Vivian Bertseka, who has a decade-long background as a climate investor, has secured $10 million to address the challenges faced by carbon project developers. Highlighting the important role of their technology in raising quality of carbon credit market, Bertseka remarked that:

“BlueLayer empowers project developers to centralize and display data from different sources into one single set of information, which facilitates following well-established methodologies and understanding the requirements of rating agencies and standards…We also enable them to report and communicate their impact with ease, accuracy and detail.”

The team includes Alexander Argyros and Gerardo Bonilla who have experience in building global software businesses. They have identified the limitations project developers face in scaling high-quality projects due to inadequate resources and tools.

BlueLayer is engaging with over 200 carbon project developers and ecosystem players. The company discovered that despite increased attention and billions of dollars of funding, developers still struggle with hefty manual processes. They are also relying on outdated systems like spreadsheets.

According to an industry report, project developers may even lose $2.6 billion by 2030 due to verification delays. This can also cost the VCM 4.8 gigatons of carbon credits.

Recognizing such challenges, BlueLayer developed an all-in-one platform tailored to support developers across the entire project lifecycle. This includes the pre-feasibility stage, credit issuance, inventory tracking, and order management.

The platform caters to developers at all stages, while offering essential tools for project development, data management, and stakeholder communication.

BlueLayer’s enterprise-grade software aims to unlock growth, enhance transparency, and improve carbon project quality. Moreover, it provides immediate value to customers by optimizing revenues, reducing time to market, managing portfolio complexity, and improving data accessibility and auditability.

The company works with ecosystem leaders and seamlessly integrates with various third parties, including data providers and registries.

BlueLayer’s $10 million funding propels the European startup into the spotlight. With a mission to enhance carbon credit market quality, BlueLayer aims to revolutionize project development, contributing to the significant scaling of carbon markets predicted by experts.

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Blockchain-Backed Passports for Transparent Carbon Removal Launched by Tomorrow’s Air

January 31, 2024/in Uncategorized /by

PicoNext has recently announced a collaboration with Tomorrow’s Air, the flagship climate initiative of the Adventure Travel Trade Association. Tomorrow’s Air focuses on educating, inspiring, and mobilizing individuals to support carbon removal technologies and sustainable aviation fuel in the travel industry.

The initiative is part of a larger effort to promote sustainable travel practices and innovative climate solutions.

Every payment received by Tomorrow’s Air supports climate conscious travel education. It also funds the scale up of carbon emission reductions and carbon removal innovations.

PicoNext is an end-to-end platform for experienced brands to engage their customers using public ledgers. With integrated Digital Product Passport, sustainability transparency, and loyalty capabilities, PicoNext enables companies to use blockchains in promoting products/services.

What are Digital Product Passports?

As part of their collaboration, PicoNext is powering Tomorrow’s Air’s new Digital Product Passports designed for carbon removal purchases. These passports offer a unique way for travelers to track the progress and impact of associated carbon removal orders.

When individuals embark on a journey with one of Tomorrow’s Air’s partner travel businesses, the Digital Product Passport allows them to gain insights into how carbon dioxide emissions associated with their travel are being effectively removed from the atmosphere.

The Digital Product Passport includes a detailed representation of carbon removal purchases specific to a particular travel business. It offers travelers a deeper understanding of how industry partners are contributing to the scaling up of essential technologies for cleaning up excess CO2.

The carbon removal information stored in Tomorrow’s Air Digital Product Passports is cryptographically secure, ensuring the integrity of the data. This adds an extra layer of transparency and trust to the process, as the information can’t be changed or tampered with once it’s written to the blockchain.

Moreover, updates on the status of climate initiatives within the Digital Product Passport remain accessible indefinitely across distributed ledgers. As such, it provides travelers and Tomorrow’s Air’s travel business customers with insights into the progress of carbon removal actions.

The intuitive web-based viewer provided by PicoNext enables easy access to view the status of these public-ledger carbon removal events.

The Passport to Transparency in Carbon Removals

Tomorrow’s Air is advancing its approach to carbon capture reporting by transitioning from PDF-based certificates to PicoNext’s Digital Product Passports. This evolution aims to provide enhanced transparency to a broader audience of stakeholders using sustainable and energy-efficient public ledgers.

Unlike traditional PDF certificates, Digital Product Passports leverage blockchain technology to offer an easy-to-access method for gaining deeper insights into a company’s sustainability initiatives.

Underlining this aspect, Christina Beckmann, creator of Tomorrow’s Air remarked that:

“Tomorrow’s Air adds value by collaborating with the most trusted, reputable carbon removal suppliers – and by elevating transparency using Digital Product Passports we give our customers unmatched visibility into their carbon removal orders.”

By using Digital Product Passports, Tomorrow’s Air can engage customers with a more interactive and transparent representation of carbon removals. This approach not only substantiates a company’s commitment to sustainability but also fosters greater trust among stakeholders.

More notably, it serves as a proactive measure against greenwashing, addressing consumer concerns about the authenticity of sustainability claims.

Several high-profile cases have highlighted the negative consequences of greenwashing, leading to legal actions and reputational damage. Delta Air Lines, Evian Natural Spring Water, Nivea, TotalEnergies, KLM, and FIFA have all faced legal challenges related to their environmental claims.

It’s no surprise, therefore, that environmental groups unanimously agree in supporting environmental and social data in a Digital Product Passport. As shown in the chart below, 92% of environmental organizations/NGOs prefer to see environmental data in the passport.

PicoNext’s technology allows organizations to showcase their commitment to sustainability on a public ledger, providing a verifiable record of progress toward environmental goals. By leveraging this technology, companies demonstrate that their marketing claims align with genuine environmental impact, thus safeguarding their claims’ integrity.

This innovative approach is applicable across various industries, such as manufacturing, fashion, textiles, batteries, and electronics.

Furthermore, adopting Digital Product Passports assists companies in complying with European Union regulations that emphasize product-level transparency. The passports provide a transparent and substantiated record of sustainability data throughout a product’s lifecycle.

In conclusion, the collaboration between PicoNext and Tomorrow’s Air signifies a significant stride toward transparency and accountability in carbon removal efforts. The introduction of Digital Product Passports not only empowers travelers to track their carbon footprint but also sets a new standard for sustainability reporting in the travel industry.

The post Blockchain-Backed Passports for Transparent Carbon Removal Launched by Tomorrow’s Air appeared first on Carbon Credits.

Up in Smoke? Study Questions Accuracy of Cookstove Carbon Credits

January 30, 2024/in Uncategorized /by

Companies wanting to offset their harmful emissions have used a type of carbon credit known as “cookstove credits” to compensate for their pollution. But a new study suggests that the clean cookstove projects may be overstating their impact by about 1,000%.

The cookstove projects aim to address issues related to household air pollution and deforestation caused by traditional cooking methods. These projects are seen as a way to achieve UN sustainable development goals (SDGs) and have gained popularity.

Within 6 months in 2023, a report showed cookstove projects issued the most new credits in the market, taking 15% of the total, while also registering the most new projects.

However, the study published in Nature Sustainability suggests that these projects are exaggerating their climate benefits. It reveals that 9 out of 10 of the 96 million certified cookstove credits don’t avoid the emissions they claim.

Burning Questions: The Climate Impact of Cookstove Carbon Credits

Around 3.2 million premature deaths occur annually due to household air pollution, according to the Clean Cooking Alliance (CCA). Burning wood for cooking also contributes to about 2% of global greenhouse gas emissions.

The CCA, backed by governments including the Netherlands, Canada, and the United States, is working on an improved methodology for cookstove credits. The CCA aims to address the challenges associated with accurately measuring emissions reductions from cookstove projects. This is due to the complexity and resource-intensive nature of the task.

The alliance believes that the carbon market can play a significant role in addressing this issue with carbon credits.

Carbon credits represent one tonne of carbon emissions in theory. Companies buy them to offset their emissions, allowing them to neutralize their carbon footprint. These market instruments are facing increased scrutiny as concerns grow about the effectiveness of carbon offset schemes.

Cookstove credits, a type of carbon credit, have become one of the fastest-growing project types on the voluntary carbon market. These credits are issued when cleaner or less energy-intensive cookstoves are distributed to communities that traditionally rely on dirty fuels like wood or kerosene.

They typically cost much more than the other types of carbon credits available today, given the multiple SDGs they address. For instance, the carbon pricing from Gold Standard below shows that cookstove credits are priced higher than forestry credits.

Monetary Value of Gold Standard Project Impacts/Ton of CO2 Emissions Reductions

As of May 2023, cookstove projects represented 1,213 out of the 7,933 project activities on the VCM. They also generated ~78.9 million total issued credits in the market.

Moreover, cookstove offset projects can progress several SDGs such as climate, energy, health, gender, poverty and deforestation.

But the study, conducted by researchers at the University of California, Berkeley, challenges the projects’ claim. The researchers indicate that many offsetting schemes claiming to support “clean” cookstoves often fail to meet World Health Organization standards.

Their results raise concerns about the accuracy of the claimed climate benefits of such projects. They’re calling for a closer examination of their impact on air quality, deforestation, and overall environmental and social benefits.

Carbon Cookout: The Environmental Benefits of Cookstove Projects

The research indicates that the rules allow projects to exaggerate stove usage and the resulting benefits for nearby forests. In turn, they significantly inflate the claimed benefits for climate and biodiversity, the study noted.

Issued Cookstove Credits Across the VCM vs Study Sample

The above images map out the credits issued so far on the VCM across the five methodologies covered as of 9 November 2022 (top panel). The study sample (bottom panel) includes the 51 cookstove project activities. It covers the GS-TPDDTEC, GS-simplified, CDM-AMS-II-G, CDM-AMS-I-E and GS-metered. Source: Gill-Wiehl, A. et al. 2024

While acknowledging the issues, the researchers propose that reforms to the rules governing carbon credits could still make them a meaningful source of climate finance if properly implemented. They also offer a method for clean cookstove projects to avoid overstating their impact.

Some companies have reportedly adopted those practices during the paper’s peer-review process.

The lead author of the study, Annelise Gill-Wiehl, highlighted the potential impact of over-crediting. She stated that it “replaces direct emission reduction and other more effective climate mitigation activities”.

The study contributes to the ongoing scrutiny of the unregulated voluntary carbon market. Major concerns center on the generation of potentially questionable carbon offsets.

Barbara Haya, the director of the Berkeley Carbon Trading Project and a co-author of the study, expressed hope that the recommendations provided could contribute to improving the quality of carbon credits.

Clearing the Air: The Controversy

In response to the study, an open letter from carbon project developers and researchers highlighted concerns about the research. They argued that the academics focused on larger cookstove projects, which usually issued more credits distributed than smaller initiatives.

Carbon credit registries Verra and Gold Standard disputed the findings.

The Gold Standard, a major carbon credit certifier, has disputed the findings. Gold Standard stated that the study’s conclusions weren’t supported by the evidence and were at odds with wider academic literature. The researchers acknowledged that Gold Standard produced the best-quality method for producing offsets, with only a 1.5 times over-crediting.

Verra, the world’s largest carbon standard, also expressed disappointment in the continued attention on the study. The certifier emphasized that the findings did not directly relate to its current methods.

Verra is developing a new methodology for cookstoves that reflects best practices and includes measuring techniques to verify stove usage.

The cookstove company ATEC, working with UC Berkeley to measure benefits more accurately, supported the research’s goal of ensuring accurate emission reductions.

The study challenging the accuracy of cookstove carbon credits raises critical concerns about the claimed climate benefits. The industry disputed the findings, but the call for improved regulations and accurate measurements remain to ensure transparency and effectiveness of carbon offset markets.

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