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2013 Voluntary Carbon Markets Report
Now Available For Download

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The 2013 State of the Voluntary Carbon Markets Report is now available for download, and will be formally presented today, June 20th, from 4:30pm to 6pm at the law offices of Baker & McKenzie in Washington, DC. The much-anticipated report brings to light key findings to explain why voluntary markets are doing so well while UN markets are suffering.






20 June 2013 | We’re not trying to be a tease, but Ecosystem Marketplace's recently released executive summary of the State of the Voluntary Carbon Markets 2013 report only scratched the surface of what are some interesting and sometimes surprising findings from our survey of the 2012 voluntary offset marketplace.

For the full scoop on market developments in 2012, download the full report to the right. If you’re based in Washington DC, you’re also invited to join us for this afternoon’s launch event – see below for details.

To recap our executive report’s high level findings, voluntary actors contracted 101 million tonnes of carbon offsets (MtCO2e) for immediate or future delivery in 2012 – 4% more than in 2011. While the overall market value of these transactions decreased 11% to $523 million due to falling prices for several popular project types, voluntary actors paid a volume-weighted average price of $5.9/tCO2e, slightly down from $6.2/tCO2e in 2011 but significantly higher than under the United Nations’ regulatory Clean Development Mechanism scheme.

 

Other report findings:  

 

  • 90% of offset volumes were contracted by the private sector – where corporate social responsibility and industry leadership were primary motivations for offset purchases.
  • Offset buyers’ desire to positively impact the climate resilience of their supply chain or sphere of influence was evident in our data which identifies a strong relationship between buyers’ business sectors and the project categories from which they contract offsets.
  • A sizeable portion of market value (64% of value associated with a contract type or $170 million) was paid to offset sellers at the point of transaction rather than offset delivery – primarily via spot contracts (35.6 MtCO2e, up 25% from 2011) and pre-payment for future delivery (8.7 MtCO2e, down 1% from 2011).
  • Demand surged for carbon offsets from forestry projects certified to the Verified Carbon Standard and the Climate, Community and Biodiversity Standards. Voluntary buyers also funneled $80 million to Gold Standard-certified offsets from projects that distribute clean cookstoves and water filtration devices.
  • Suppliers predict market value could reach $1.6 - $2.3 billion in 2020 – if market actors can effectively communicate the relevance of offsetting and carbon market infrastructure to private sector actors, the international donor community, and governments seeking tools to incentivize, verify, and finance climate action.

If we've managed to whet your appetite for more interesting facts, figures and anecdotes, be sure to check our landing page on June 20 for the release of the full report.

 

 

Washington DC Report Launch Event This afternoon!

For those of you in the US, we invite you to join us for the North American launch of the full State of report, hosted by Baker & McKenzie at their Washington, DC offices on June 20. A panel of US-based carbon experts will join us in presenting and discussing more in-depth findings from our full report. To attend, RSVP to bakerevents@bakermckenzie.com or call +1 202 835 1661, providing your full name, company, and title. If you would like to bring a guest, please also provide their details, including email address.

 

Time/Date/Place:

Washington DC Law Offices of Baker & McKenzie

815 Connecticut Ave NW | Washington, DC 20006, USA

Thursday, 20th of June, from 4:30 to 6:00PM (Panel Presentation); 6:00PM+ Reception

 

We hope to see you there!

 

—The Editors

For comments or questions, please email: vcarbonnews@ecosystemmarketplace.com


V-Carbon News

Voluntary Carbon

Fighting the good fight

Supporters of the Rimba Raya Biodiversity Reserve project in Indonesia have had to fight for its survival, particularly against a plan by Indonesia’s Ministry of Forestry to turn over more than half of its 80,000 hectares to palm oil interests, which would have prevented it from becoming the first REDD+ project to generate credits under the Verified Carbon Standard (VCS). But the troubled project emerged victorious after independent auditor SCS Global Services confirmed that the project prevented the emission of roughly 2.2 MtCO2e into the atmosphere over a one-year period ending July 2010, allowing it to sell VCUs from that period. The project aims to reduce emissions by 119 MtCO2e over its 30-year lifetime.

  – Read Ecosystem Marketplace article

 
Guardians of the forest

Four years ago, the indigenous Paiter Suruí of the Brazilian Amazon voted to shift the basis of their economic livelihoods away from logging and other activities that require bulldozing the forest and towards activities that conserve it. To finance the shift, they sought to earn credit for the carbon captured in trees under through REDD+ and sustainable forest management activities. Last week, an independent audit confirmed they had become the first indigenous people in the world to generate REDD+ credits under VCS’s rigorous criteria, which requires detailed validation and verification procedures.

  – Read Ecosystem Marketplace article
  – Read more from Mongabay

 
Gold Standard growing on trees

Market participants can now weigh in on the Gold Standard’s proposed land use and forests framework. The organization has asked for comments on the draft framework, the Afforestation/Reforestation requirements and corresponding A/R guidelines. Currently, only A/R projects are valid under the framework, but further project types will include agroforestry, improved forest management, improved livestock management and climate-smart agriculture. Existing projects from other standards from either the voluntary or compliance markets can transfer over to pursue Gold Standard certification if they meet the requirements. 

 

The Gold Standard is inviting public feedback on the above through June 28 (with the standard expected to be valid as of August 2013), as well as public feedback on its suppressed demand methodology for energy use for low GHG food preservation.

  – Read Ecosystem Marketplace article
  – Comment on land use & forests rules
  – Comment on suppressed demand methodology

 
Not anti-social

The SocialCarbon Standard’s bottom-up approach to certifying the co-benefits of offset projects has had a noticeable impact on local communities in several countries, primarily Brazil and Turkey. The standard, which has experienced an incremental increase in usage since the first issuance and retirement of SocialCarbon offsets five years ago, is now coming in for a tune-up that officials pledge will streamline the process and lower costs for project developers. 

  – Read Ecosystem Marketplace article:

 
A lean, green machine

The American Carbon Registry (ACR), a leading carbon offset program, is now part of the Green-e Climate Endorsed Program by the Green-e Governance Board. Emissions Reduction Tons (ERTs) issued by ACR can now be used in Green-e Climate certified offset products. Nicholas Martin, ACR Chief Technical Officer stated, “We look forward to working with companies that offer Green-e Climate certified offsets to their clients to broaden offset options to new and innovative project types.” ACR is also an approved Offset Project Registry (OPR) for California’s cap-and-trade program. 

  – Read more

 
Don't throw the rice

The Climate Action Reserve (CAR) released the latest version of its rice cultivation project protocol, which provides guidance on how to quantify, monitor and verify greenhouse gas emission reductions resulting from changes in water and residue management in rice cultivation. CAR’s board first adopted in the protocol in December 2011, with the latest version released on June 3. The California Air Resources Board is considering adding rice cultivation to its list of approved offset project types in its cap-and-trade program, with a decision expected in the second half of 2013. 

  – Read protocol

 
Planting the seeds

A REDD+ pilot project in Nepal pursuing VCS/CCB certification recently provided seed grants to communities from watershed areas in Dolakha, Gorkha, and Chitwan districts for their role in conserving and sustainably managing forests. The three districts received a total of $95,000 for the third year of carbon payments. The watersheds maintained and sequestered 69,959 tCO2e in two years from the baseline stock of 4,292,967 tCO2e in 2010. Launched in 2009, the REDD+ pilot project is one of the world’s first carbon offset projects involving local communities in monitoring the carbon in their forests and providing the necessary training for them to participate in the project.

  – Read more

 
False advertising

UAE-based Advanced Global Trading’s claims that it can resell carbon credits at more than three times the average market price have been publicly challenged by clients who say they are having trouble unloading their credits. Company officials blamed the rebounding Dubai property market for turning people away from alternative investments and pledged that their clients will likely see the return they are expecting if they show enough patience. But the likelihood of recouping investments made in these credits is probably zero, according to one carbon markets consultant, hence why several market experts question the appropriateness of individual offset investment schemes in the context of the collapsing compliance market where Clean Development Mechanism offsets are sold for less than $1/tCO2e.

 

  – Read more
  – Read the Executive Summary of Ecosystem Marketplace's State of the Voluntary Carbon Markets report

 

Reduce & Retire: The Latest on Carbon Neutral

Luck be a lady

The Town of Ladysmith in British Columbia became a carbon-neutral community in 2012 due to the purchase of 365 tCO2e in carbon credits through the Community Carbon Marketplace, a trading marketplace for voluntary emissions reductions launched by Cowichan Energy Alternatives Society. The credits used to meet the carbon-neutrality goal were purchased from community-based greenhouse gas reduction projects. In British Columbia, 178 out of 182 communities have committed to becoming carbon neutral. 

  – Read more

 

Climate North America

The Darkwoods saga continues

Criticisms leveled at British Columbia’s carbon offsets program by the provincial Office of the Auditor General aren’t standing up to scrutiny, while VCS’s defense of the program appears to be accurate. The auditor’s report, for example, said that the Nature Conservancy of Canada’s Darkwoods Carbon Project was not “credible”, partly because the report contended that most private land in the region is managed sustainably, and that a commercial buyer would have done the same. But an Ecosystem Marketplace article exploring these claims in depth finds that some of the auditor’s findings are inaccurate.

  – Read Ecosystem Marketplace article

 
Old MacDonald had a farm

Several farmers providing offsets to Alberta’s carbon program have not received payment for their efforts, while the complexity and increased – and some argue more costly – regulation of the tillage program, the largest generator of credits, has drawn criticism. The province was the first jurisdiction in North America to establish a compliance program aimed at reducing greenhouse gases. Government officials still express support for and confidence in the program despite its issues.

  – Read more

 
Buyers beware

In an effort to address a major obstacle to the growth of California's compliance offset market, CAR has partnered with specialty insurer Parhelion Underwriting to mitigate the risk of invalidation for ozone-depleting substances (ODS) and livestock offsets bound for California’s compliance market through an insurance policy. The coverage is designed to remove the risk presented by the buyers’ liability provisions featured in the California Air Resources Board’s (ARB) regulations governing the cap-and-trade program. The provisions allow the ARB to invalidate credits that are found to be faulty or fraudulent and require regulated entities to surrender replacement offsets for compliance. But the insurance policy would indemnify the owner of the offset credit for the replacement cost of an invalidated offset.

  – Read Ecosystem Marketplace article

 

Kyoto & Beyond

Cutting the red tape

In a bid to bolster its flailing market, the Executive Board of the Clean Development Mechanism agreed to new rules for emissions reduction projects in Africa. The board approved a standardized baseline for projects that aims to cut emissions in Uganda by replacing burning fossil fuels with charcoal and a baseline that can be used for renewable energy projects in nine other African countries. At least one analyst questioned whether the new rules will have the desired effect of boosting project development on the continent. 

  – Read more

 

Global Policy Update

No retreat, no surrender

Australian Climate Change Minister Greg Combet pledged his party would stick with its carbon pricing program even though it has been sharply criticized by regulated entities and opposition party members ahead of the federal election in September. The carbon tax, which will transition into an emissions trading program beginning in 2015, has been effective in helping to reduce carbon emissions by more than 7%, increasing renewable energy generation by about 30% and creating more than 150,000 jobs since its July 2012 implementation, he said. But the carbon price has been blamed, often inaccurately , for higher prices for goods and services in the country.

  – Read more

 
Death of carbon pricing greatly exaggerated?

More than 40 national and 20 sub-national jurisdictions are either implementing or considering mechanisms to price carbon, according to the World Bank’s latest annual report. Despite the troubles in the European Union’s Emissions Trading Scheme and the US Congress’ hostility toward a federal cap-and-trade program, new pricing initiatives are emerging across the globe, including in Australia, California, China and South Africa. These initiatives can make a difference as these jurisdictions emit the equivalent of roughly 10 GtCO2e per year, equal to about 20% of global emissions. And improvements in the programs are already underway, including linkage to other jurisdictions and expansions of their scope.

  – Read more

 
Keeping the lights on in Britain

Britain’s legislature must pass a bill to significantly reduce carbon emissions in the power sector or risk higher energy bills and power cuts, according to the House of Commons’ top energy official. The proposal would facilitate the building of new renewable energy and nuclear facilities while limiting contributions from the traditional fossil fuel sector. But the proposal could face opposition by some legislators who prefer a more aggressive approach. 

  – Read more from Sydney Morning Herald
  – Read more from the Telegraph

 
Making new friends

Japan and Kenya signed an agreement to join forces as part of Japan’s Joint Crediting Mechanism (JCM), a program in which the East Asian country contributes to the reduction of greenhouse gas emissions in partner countries by transferring its low-carbon technology and products. The two countries agreed to mutually recognize that verified emission reductions or removals by the mitigation projects under the JCM can be used as a part of their own internationally pledged mitigation efforts. Japan previously announced a similar partnership with Ethiopia to cooperate in the reduction of GHG emissions. The partnership will boost financial and technological support for offset projects in the African country and help Ethiopia meet its pledge to achieve zero net carbon emissions. Earlier this year, Japan signed its first bilateral offset agreements with Mongolia and Bangladesh, with additional plans to sign agreements with Indonesia and Vietnam. 

  – Read more

 
It's a bird, it's a plane... it is a plane

The International Air Transport Association has agreed to ask governments to establish a program through which the airlines would offset emissions increases after 2020 by buying carbon credits from projects that reduce emissions in other sectors. The proposal is meant to boost efforts to reach a global deal to regulate greenhouse gas emissions from airlines before the EU follows through on promises to include the aviation sector in its cap-and-trade system. The EU postponed plans to incorporate the sector into its program for one year, but pledged to take action unless a global agreement was reached.

  – Read more

 

Featured Jobs

Program Assistant - Climate Action Reserve

Based in Los Angeles, the Program Assistant will serve as a technical resource to project developers and verification bodies and provide guidance with respect to policy interpretation, methodology and clarification issues related to the Reserve’s protocols. Candidates should have a Bachelor’s Degree in environmental science or management, public policy, or a related degree and experience working with GHG/climate change.

  – Read more about the position here

 
EU Emissions Trading Internship/Master Thesis – FutureCamp

Based in Munich, the Intern will provide quantitative analysis of the market structure in the EU ETS as well as an analysis of trading strategies of market participants, broken down to sectors. Candidates should have a degree in industrial engineering and management, business management or economics. 

  – Read more about the position here.

 
Stove Program Associate - Impact Carbon

Based in Uganda, the Stove Program Associate will be assist Impact Carbon’s clean cookstove project team in operations, administration and record keeping efforts and will ensure compliance with carbon guidelines by assisting local manufacturers in capacity building activities. Candidates should have a degree in business, economics or industrial relations and 1-3+ years of work experience.

  – Read more about the position here

 
Environmental Markets Analyst, North America - Bloomberg New Energy Finance

Based in New York, the Analyst will undertake research and analysis of markets such as the carbon cap-and-trade program in California and Quebec, the evolving carbon markets elsewhere on the continent and the renewable energy credit (REC) markets in the US. Candidates should have a Graduate Degree with emphasis on the energy industry or carbon markets and/or 2-4 years of work experience in carbon markets.

  – Read more about the position here

 
Energy and Environmental Commodities Broker - Karbone

Based in New York, the Energy and Environmental Commodities Broker will structure and execute bilateral contracts for all classes of energy and environmental commodities, including carbon credits and emissions permits and will establish and manage relationships with various market participants. Candidates should have a relevant undergraduate and/or graduate degree and 2+ years’ brokerage or other sales experience.

  – Read more about the position here

 
Research Assistant, Climate - Center for Global Development

Based in Washington, D.C, the Research Assistant will conduct literature reviews and data compilation and analysis for ongoing and new research projects. Potential areas of focus include climate finance, REDD+, energy and adaption. Candidates should have a Bachelor’s Degree in economics, international affairs or a related field and 1-2 years of professional experience.

  – Read more about the position here

 
Two Positions - World Resources Institute

WRI is looking to fill two positions in its Washington, DC office. The Research Intern, International Financial Flows and Environment will support ongoing climate finance research, in particular around international climate funds and institutions and developing country climate finance institutions. Candidates should be recent graduates or Master’s students pursuing a degree in environmental studies, international relations, or a related field and have 1-3 years' work experience. The Climate Finance Associate will author and publish new research on climate finance and serve as one of WRI’s climate finance experts for internal and external audiences. Candidates should have a graduate degree in a relevant field like development economics, finance, or environmental law and 7-10+ years' experience.  

 

 
Two Positions - Nature Services Peru

Based in Cusco, the Project Coordinator will be responsible for the development and certification of environmental credits and will develop baseline, PIN and PDD documents. Candidates should have a Master’s Degree in science, engineering, or business, 5+ years of relevant work experience and be fluent in Spanish. Also based in Cusco, the Administrative Manager will be responsible for the financial management of the organization and will work to strengthen financial systems and communications. Candidates should have a Graduate Degree in business administration, law, engineering or science, 2+ years of relevant work experience and be fluent in Spanish. 

 

 
Agriculture Project Analyst, Working Lands - Environmental Defense Fund

Based in San Francisco, the Project Analyst will manage and/or support the Director with agriculture GHG projects and lead the day-to-day operations of 1 to 3 projects. Candidates should have a Bachelor’s or Master’s Degree in economics/policy, natural resource management or science and 2+ years of experience translating social and natural science information to public policy/recommendations.

  – Read more about the position here

 
 
 

ABOUT THE ECOSYSTEM MARKETPLACE

Ecosystem Marketplace is a project of Forest Trends, a tax-exempt corporation under Section 501(c)3. This newsletter and other dimensions of our voluntary carbon markets program are funded by a series of international development agencies, philanthropic foundations, and private sector organizations. For more information on donating to Ecosystem Marketplace, please contact info@ecosystemmarketplace.com.

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