August 2024 VCM Updates: Section A

This article is an automatically translated version of the original Japanese article. Please refer to the Japanese version for the most accurate information.

sustainacraft Inc. newsletter. This article is Section A (Market Trends) of VCM Updates (Voluntary Carbon Market Updates).

Before we delve into the main topic, here's an announcement.

The Science Based Targets initiative (SBTi) released several reports on July 30. These include 'Findings on the Effectiveness of Environmental Attribute Certificates (EACs)' and a 'Discussion Paper on Scope 3 Target Setting and the Use of EACs within it'. We will be holding a seminar to explain the contents of these reports.

• Title: [Breaking News] In-depth Explanation of SBTi's July 30 Announcement!
• Date/Time: Tuesday, August 27, 2024, 13:30-15:30 (up to 2 hours)
• Venue: Online
• Registration URL: here

We encourage participation not only from those considering procuring Carbon Credits based on traditional 'Offsetting', 'Beyond Value Chain Mitigation (BVCM)', or 'neutralization with Removal Credits', but also from those exploring how to utilize 'Insetting' for Emission Reductions within their Value Chains or 'Commodity Certificates' for procuring low-carbon materials under SBTi and the GHG Protocol.

Furthermore, while SBTs are, as the name suggests, 'science-based', there are also many aspects that involve 'design choices' unrelated to science. We would like to introduce some discussions around these points.

The main topic begins here.

In this newsletter, we will introduce four companies as Credit Retirement corporate use cases from last month (July 2024): Bayer, PetroChina, GrabCar (a Singapore-based tech company offering ridesharing and other services), and Mirvac (an Australian property developer). Mirvac aims to advance Scope 3 GHG Reductions by procuring recycled materials and low-carbon concrete for materials used during infrastructure development (such as concrete, steel, and aluminum). To claim these reductions, the use of commodity certificates is anticipated. However, a certain level of traceability is required for accounting under SBTi and the GHG Protocol. (This is also a key point discussed in the recent SBTi Scope 3 discussion paper, and we will cover this topic in the seminar mentioned above).

For Project Pipeline analysis, we will introduce Agricultural Land Management (ALM) projects in Panama and Costa Rica. As for new nature-based projects, while REDD+ Issuance has decreased due to a large-scale Methodology transition, ALM projects are increasingly seen among the top-ranking large-scale projects. These two projects have rePLANET as the Proponent. This Proponent is also well-known for advancing Biodiversity Credit creation projects, and for these current projects, Biodiversity gains are expected to be monitored based on Biodiversity Credit Methodologies. For these projects, quantification is planned to align with the Wallacea Trust, rather than Verra's Biodiversity Credit framework, the Nature Framework (part of SD VISta).

For inquiries, please contact us here.

(Updated regarding rePLANET's projects on 2024/9/25.)

«Structure of VCM Updates»

A. Voluntary Carbon Credit Market Trends ← Focus of this Article

1. Credit Issuance and Retirement Analysis
2. Project Pipeline Analysis

B. Trends in Major International Regulations

A. Voluntary Carbon Credit Market Trends (Verra)

A-1: Credit Issuance and Retirement Trends

- Registries analyzed: Verra, Gold Standard (GS), Climate Action Reserve (CAR), American Carbon Registry (ACR) 
- Period: July 2024
- Notes: Please be aware that companies that Retire Credits are not obligated to register with their real names with the registries, and therefore, accuracy cannot be guaranteed. Additionally, there may be delays in registry updates, so please note that the number of projects or their status may change for the period covered.

Issuance and Retirement performance for the period is as follows (figures in parentheses indicate year-on-year change).

• Issuance: 21.37 million (+28%), of which nature-based: 7.17 million (+300%)
• Retirement: 8.65 million (-19%), of which nature-based: 2.63 million (-32%)

<List of Issued Projects>

Below are the top 10 projects for which Credits were Issued during the period. Of these, three are Improved Forest Management (IFM) projects (ACR/CAR registries), with approximately 5.10 million Credit units Issued.

<List of Retired Projects>

Below is a list of nature-based projects Retired during the period.

<List of Retiring Companies>

Below are the top 10 companies that Retired nature-based project Credits during the period. In this newsletter, we will introduce four companies: Bayer, PetroChina, GrabCar, and Mirvac. Bayer was also featured in our April newsletter.

Corporate Case Study

About Bayer

Last month, Bayer Retired 220,000 Credit units from the VCS-961 project El Arriero. The Methodology for this project was AR-ACM0001, which is now inactive and has been replaced by AR-ACM0003. This change was detailed in our May Methodology Update newsletter.