January 2025 Methodology Update (2/n)
This article is an automatically translated version of the original Japanese article. Please refer to the Japanese version for the most accurate information.
This is a newsletter from Sustainacraft Inc. Methodology Updates is a series that covers methodologies for carbon and biodiversity credits.
This article introduces Isometric, a highly digitized carbon standard and registry specializing in Carbon Dioxide Removal (CDR).
As introduced in this month's VCM Update, Verra still holds a significant share in the Voluntary Carbon Market (VCM), but its share by Issuance volume has halved over the four years since 2021. A major factor is the temporary decrease in Issuance due to a large-scale Methodology revision for REDD+, but other factors such as recent consideration of reputational risk and overly strict Methodologies are also believed to be influential. Beyond these, one perspective Project Developers consider when choosing a carbon credit standard/registry is the "simplicity of procedures" and "required timeframe" for Credit Issuance.
For Project Developers, a long timeframe until Credit Issuance is a critical issue. This is because, in typical Pay on delivery Offtake Agreements, even if an Offtake Agreement is signed, payment is not received until Credits are delivered to the contract holder.
At Verra, due to resource shortages and slow digitization, the timeframe for Credit Issuance is long, and it's not uncommon for Credits to have a Vintage (the number of years since the Emission Reduction or Sequestration actually occurred) of three years by the time they are issued. In this situation, there is a growing movement towards emerging registries like Isometric, which is featured in this article, that are highly digitized and have short lead times for Credit Issuance.
Market Trends Regarding the Advancement of Digitization
The introduction of digitization to carbon standards and registries has the potential to enhance project transparency, improve the efficiency of Measurement, Reporting and Verification (MRV), and simultaneously shorten the time until Credit Issuance. Over the past year, the development and utilization of Digital MRV have rapidly advanced (this topic was also covered in our October 2024 newsletter).
Furthermore, to further enhance transparency and efficiency, the digitization of registries themselves is progressing. For example, Verra released a digital project submission tool and digitized project review reports this year. As major standards integrate Digital MRV into their Methodologies and advance registry digitization, new platforms based on a digital-first approach are continuously emerging. Here, we introduce one such platform: "Isometric".
Isometric Was Established with a Focus on a Digital-First Approach and CDR
Isometric is a carbon credit standard and registry established in 2022, aiming to solve challenges in the carbon market. The company emphasizes scientific rigor and data transparency, working towards rapid Verification and the elimination of conflicts of interest. Isometric's standard specializes in Digital MRV, and its registry operates with a digital-first approach. It exclusively deals with "protocols" (Methodologies) related to Carbon Dioxide Removal (CDR), primarily focusing on protocols with high Permanence (over 1,000 years), such as Direct Air Capture, bio-oil geological Sequestration, and enhanced rock weathering. Furthermore, it avoids conflicts of interest by adopting a flat-fee model based on carbon removal purchase agreements, rather than the traditional model of charging a fee per Credit1. Based in London and New York, Isometric has received $25 million in funding from companies such as Lowercarbon Capital and Plural.