Nathan Truitt’s Post

There has been a heated response on the issue of whether the #VCM should be allowed to exist. Clearly there are two schools of thought. The proponents say that it is an important temporary solution to mobilize capital and the other seeks decarbonization perfection. Both agree that we don’t have the right solution yet to meet net zero targets. Our world is built on capitalistic economic development. Polluters cannot turn off the switch. Decarbonization of supply chains and investment in sustainable practices will take time to demonstrate results. Simultaneously asking polluters to channel funds into the right projects should be encouraged as a penalty not absolution. Focus should be on making sure carbon credits are coming from projects that are making real difference and that they are accurately measured. This is currently the best path forward. Time’s a wastin!

Some thoughts on the NGO Joint Statement "Why carbon offsetting undermines climate targets": - Carbon offset projects can often be implemented more quickly than major infrastructure changes, such as transitioning to renewable energy or enhancing energy efficiency, providing an immediate reduction in GHG emissions. - Carbon offsetting can channel funds to projects in developing countries, helping them to implement sustainable practices and reduce emissions in regions that might otherwise lack the necessary resources. - Integrity concerns are addressed by ICVCM Core Carbon Principles,etc. Advances in technology, such as satellite monitoring, enhance the transparency and traceability of carbon credits, ensuring emissions reductions are real and verifiable. - Carbon offset methodologies and projects are continuously evolving, incorporating lessons learned to improve their efficacy and reliability. As the market matures, new regulatory frameworks will likely emerge, informed by ongoing research and practical experience, leading to more robust and effective carbon offset mechanisms. - The market’s evolution has spurred innovative approaches to carbon sequestration and emission reduction, diversifying the types of projects available and enhancing their impact.   - Carbon offsetting is just one of many tools available to reduce carbon footprints. It is not solely used to allow polluters to continue their activities but is part of a suite of strategies that include energy efficiency improvements, renewable energy adoption, and sustainable practices. - When used appropriately, carbon offsets can complement direct reduction efforts by addressing emissions that are currently unavoidable. The Oxford Principles emphasise reducing emissions first and then using offsets. - Research by Trove indicates that companies which engage in carbon offsetting also reduce their absolute emissions at twice the rate and invest three times as much in decarbonisation as companies that don’t offset. This demonstrates that offsetting can drive greater overall reductions rather than dis-incentivising direct action. - Limited supply of offsets, if true, leads to increased prices. This economic dynamic makes absolute emissions reductions more financially attractive compared to offsetting, thereby encouraging more substantial and direct climate actions. - Higher offset prices also make currently expensive removal technologies, (e.g. CCUS), economically viable, fostering innovation and broader deployment of these critical technologies. - Collaborative efforts between governments, NGOs, and the private sector can help to address the inherent challenges of carbon offsetting and improve its overall effectiveness. - The pursuit of perfect solutions should not impede practical and immediate actions that can yield real benefits in the short term. https://lnkd.in/dWKbpVqx  

The ever growing public concerns over potential misinformation used in promoting and financing certain greenwashing activities, require an immediate and honest debate. I found this to be an eye opening study… Quote: “Sergey Paltsev, deputy director of MIT’s Joint Program on the Science and Policy of Global Change, co-led a study and workshop last year that included policymakers, industry representatives, and researchers.” “One of the most contentious issues faced at the 28th Conference of Parties (COP28) on climate change last December was a proposal for a U.N.-sanctioned market for trading carbon credits” “The concept seems simple enough: Offset emissions in one place by preventing or capturing an equal amount of emissions elsewhere. But implementing that idea has turned out to be far more complex and fraught with problems than many expected.” “We find a lot of confusion and misperceptions and misinformation, even about how you define the term carbon credit or offset,” he says.” “He points out that there has been a lot of criticism of the whole idea of carbon offsets, “and that criticism is well-placed. I think that’s a very healthy conversation, to clarify what makes sense and what doesn’t make sense. What are the real actions versus what is greenwashing?”

Yesterday, a group of 7 European countries proposed joint recommendations to improve the integrity of the voluntary carbon market and ensure full transparency, high-quality credits and credible claims. 1) Map direct and indirect emissions and draw up a climate plan with clear emission reduction targets in line with Paris. 2) Prioritize emission reductions in own organization and value chains, before looking at the use of carbon certificates. 3) Formulate clear claims in response to the use of carbon certificates while providing sufficient details to avoid misleading. And indicate whether the certificates are used to meet own climate goals (offset claim) or contribute to meeting climate goals in the host country (contribution claim), to avoid double claiming. 4) Buy certificates of high quality that represent real, additional and permanent mitigation. 5) Pay attention to the situation in the host country and how the purchase of carbon certificates there contributes to sustainable development goals. 6) Report and provide transparency on the use of carbon certificates. At arboRise we would add a seventh recommendation: 7) Buy carbon certificate at a fair price, disclose this price and allow this price to be challenged Read the statement here: 👉 https://lnkd.in/e-vkf8Xu

A pertinent subject within market-based 𝐜𝐥𝐢𝐦𝐚𝐭𝐞 𝐚𝐜𝐭𝐢𝐨𝐧 interventions & under the 𝐏𝐚𝐫𝐢𝐬 𝐀𝐠𝐫𝐞𝐞𝐦𝐞𝐧𝐭 is 🅳🅾🆄🅱🅻🅴 - 🅲🅾🆄🅽🆃🅸🅽🅶 ( & claiming) with plenty of misconceptions flying around. Paul Zakkour put down some badly needed clarity* (don’t miss the comments either!) triggered by Wijnand Stoefs (Carbon Market Watch) recent article**. Such discussions shall help creating the necessary, unambiguous narrative & regulatory clarity as well as help to avoid creating perverse incentives & a poor regulatory setup. I have tried to come up with a sonnet about double-counting, but could not get any further than the tile: 'Adorn oneself with borrowed plumes'.   So here comes a few double-counting thoughts form a professional climate bean-counter, in prose:   All GHG emissions, in other words: climate(in)action,  within the territory of a sovereign state is reported regularly by the given country to UN Climate Change. This is called an INVENTORY and its creation follows IPCC guidance. Ideally, it captures all emissions through national statistics, but it is far from perfect both in terms of scope and figures just think of the recent US discovery of on oil and gas sector reporting only a third of its methane emissions*** & global inventory challenges ****. Therefore, in a given country corporate climate action  resulting in emission reductions and removals AUTOMATICALLY enters the #UNFCCC inventory irrespective whether it was driven by national regulatory requirements or by voluntary action.   From a #ParisAgreement perspective countries will be reporting on and be proud of ALL climate action happening on their territories . Intriguingly , this implies that the weaker a country’s climate policy that could result in / allow for more, voluntary corporate action the country itself will describe ALL achievements on it territory as part of its Paris efforts (as embedded in its #NDC).This means that corporate actions filling in a regulatory gap (going beyond and above the mandatory requirements) will enter the inventory and nothing stops countries to take credit for these achievements: hence adorn oneself with borrowed plumes. There is an apparent perverse incentive: corporates may lobby to water-down regulatory stringency so they shine better with their voluntary initiatives.   Messy? Yes. This is one of the reasons why regulation/ policy and governance is so crucial!   On EU #CRCF (carbon removal certification framework): whilst it is an extremely sloppy policy endeavour with its key details to be defined later lacking democratic legitimacy and its use-cases purposefully undefined, it is at least clear on its EU-focused approach: all CRCF actions shall fall under delivering of the EU #NDC and subsequently CRCF certified activities cannot contribute to another sovereign’s NDC (or #CORSIA & other international compliance schemes) at least until a compulsory 2026 review    [text continued below in comments]

The statement on 9 April from the Board of the Science Based Targets initiative (SBTi), released as part of the process of revising the SBTi’s Net Zero Standard, was a strategic steer to further explore the role that Environmental Attribute Certificates, including carbon credits, may be able to play in climate mitigation. It marks a significant milestone in the global battle against climate change. In the context of the urgent challenge we face to reduce emissions, this is a bold step that will help accelerate corporate climate action around the world.  Countries committed to the Paris Agreement almost a decade ago. They are now discussing the update and ratchetting – increasing the ambition of – their emission reduction plans. Around the world, thousands of companies have made commitments to cut their emissions in half by 2030 and reach net zero by 2050. Yet the money hasn’t followed... The potential for SBTi to update the scope 3 guidance and their Net Zero Standard is not a carte blanche for companies to use any instrument at their disposal but a limited, strategic and high-quality addition to their climate toolkit.   Read more in a new op-ed published in Reuters by María Mendiluce, CEO, We Mean Business Coalition, Science Based Targets initiative, and Mandy Rambharos, Vice President, Global Climate Cooperation, Environmental Defense Fund: https://lnkd.in/dkUuy5ck 

I find this Reuters article by Maria and Mandy defending the controversial move by #SBTi, (now reversed due to stakeholder pressure), deeply troubling. They agree that supply chain decarbonisation is the biggest challenge of the signatories. The main reason why this is lagging is, instead of tackling this as a collective value chain goal, each company in the value chain is focused on their own scopes 1/2, and pass 'mandates' for their supply chain to decarbonise. The article itself says some signatories are still figuring out how to measure scope 3 emissions demostrating lack of seriousness about scope 3. The response to this should not be allowing more shortcuts but to hold them accountable. The solution in the article is to open up carbon credits/EACs to offset Scope 3 emissions. This creates misalignment between the way individual supply chain companies can decarbonise (no EACs) and with the signatory company scope 3 (EACs). Thus the need for collectively tackling it is further removed. Instead, signatories can buy EACs from the cheapest offer, and wash their hands away. This is similar to current approach with RECs. We will not solve the climate crisis with this. They acknowledge the key problem - that companies are not putting enough investment andthe results are plain to see. This could have been easily solved by asking companies to commit sufficient funding to supply chain decarbonisation. This can be tracked by adjusting the reporting requirements for SBTi. SBTi can ask companies to set a carbon price, and calculate the total cost of scope 3 emissions, and report the investment in supply chain decarbonisation against the total cost of scope 3 emissions. And if they are serious, SBTi can mandate a minimum percentage spend. We can guess what this simple reporting change will tell you, that at least 80% of companies who signed up for SBTi will have zero to negligible spend on supply chain decarbonisation, relative to their scope 3 emissions. There are many ways to fund supply chain decarbonisation - our recent whitepaper on funding fashion industry decarbonisation shows many old and new pathways. Note - none of them was relying on EACs. https://lnkd.in/gNuVizQ6 It is true that global South is not receiving funding - and asking the signatories (most of whom have supply chains in global south) to take responsibilities for supply chain decarbonisation will do just that - and is in line with the Paris agreement which specifically required such financial flows. There are great projects for carbon credits in the developing world, related to ecosystems and forestry - though what is legit is increasingly being challenged. Investments to these are required, but should not be conflated with value chain decarbonisation requirement.

Will pushing disclosures on the private sector fix climate change? The regulatory landscape is rapidly evolving, with an increasing number of companies required to disclose their environmental and societal impacts. This is part of a broader push to hold the private sector accountable for its role in climate change. There’s a growing belief that if companies disclose their carbon footprints, they will innovate to reduce emissions. This is based on the idea that transparency will drive change. However, this Financial Times article (https://lnkd.in/dfb2ERwJ) shows a different reality. Companies and governments are retreating from their green targets because they can’t justify how to meet them. Amid increased scrutiny, it seems safer for them to stick to business-as-usual. Lord John Browne, a former BP chief executive, is quoted as saying “The hard truth is that we’ve done a poor job of reconciling corporate actions with the interests of society and the planet in a balanced way. Yet the urgent need to do so is undiminished.” Except that this is half the story. Corporate actions could reconcile with the interests of society and the planet, this is arguably easy on paper, at a stroke of tax or caps. Simple micro-economics. But not in an overshoot scenario. And evidently not without changing the current laws governing how corporations should behave. However, the main reason anthropogenic climate forcing is unlikely to ease has little to do with corporations. It lies with people and their governments. Tunnel vision on carbon has made people myopic to the reality of the problem. The real challenge is that our economic systems already consume too much of the planet’s natural resources. Governments often hope that businesses will use less natural capital while maintaining or even increasing their output. While some sectors, like power generation, can improve significantly by shifting to cleaner energy sources, these changes alone are not enough. When considering factors like land use, water, biodiversity, and pollution, it’s clear that reducing production intensity isn't the whole answer. Governments are being sued for failing to come-up with realistic net-zero plans. So are corporations making hollow pledges. By focusing solely on the economic realm, societies are trying to discharge their agencies to companies. Corporations have many sins. Existing is not one of them. They have a significant role to play, but they can’t fix the problem alone. Societal choices and government actions are crucial. People need to decide what they are willing to change to achieve a sustainable future. As the saying goes, “You can’t have your cake and eat it too.” Understanding the true nature of the problem shifts the narrative from technology to anthropology. History is full of technological breakthroughs. Anthropological changes aren't so inspiring.

Kudos to Abigail Bassett and Climatebase for the excellent explainer on carbon offsets and the new Biden administration framework. 3 Key takeaways: 1. We cannot abandon private sector financing of SDG projects. Bravo to the administration's attempts to re-establish U.S. leadership in global climate efforts. We need to embrace a range of climate change strategies beyond domestic regulation and public funding. 2. Not "throwing the baby out with the bath water" - While the Biden administration's carbon offset guidelines are not perfect and face valid criticisms, they demonstrate a willingness to explore innovative policy tools and leverage private sector resources to tackle climate change. 3. Establishing standards for high-integrity offsets can help combat greenwashing - Offset projects that drive real, additional emissions reductions can lead to substantive sustainable impact. This nuanced position acknowledges the complexity of the challenge and the need for pragmatic solutions that engage multiple stakeholders. Are the days of unilateral approaches that promote domestic fossil fuel industries without consideration for international collaboration or market-based solutions behind us? I hope so. https://lnkd.in/eMdeyXd3 #sustainability #carbonoffsets #solutions #SDGs