May 2026 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.

This is the newsletter from Deloitte Tohmatsu Sustainacraft Co., Ltd. This article is Section A (Market Trends) of our VCM Updates (Voluntary Carbon Market Updates).

«Structure of VCM Updates»

A. Market Trends for Voluntary Carbon Credits ← Subject of this article

1. Analysis of Credit Issuance, Retirement, and Investment Trends
2. Project Pipeline Analysis
3. Detailed Commentary Section

B. Trends in Major Overseas Regulations

Introduction

Credit Issuance Performance
Total credit issuance in April 2026 reached 13.77 million units, representing a 41.32% decrease compared to the same month last year. Meanwhile, total retirements were 4.37 million units, remaining relatively stable with only a slight decrease of 6.26% year-on-year. The breakdown of issuance consists of a roughly 49% decrease in unlabeled (pure voluntary) credits (from 21.74 million to 11.16 million) and a roughly 51% increase in credits labeled with Article 6, CCP, CORSIA, or Removal (aggregated by removing duplicates for multi-labeled credits) (from 1.73 million to 2.61 million). The proportion of labeled credits in the total market expanded approximately 2.5 times, from 7.4% to 18.9%. This suggests that the shift toward qualitative assessment and regulatory compliance is indeed progressing.

Project Pipeline Trends
Regarding new project registrations this month, several noteworthy projects in the fields of Nature-based Solutions (Nature Restoration/REDD+) and Carbon Dioxide Removal (CDR) have joined the pipeline. Particularly in the CDR sector, registrations for methodologies aimed at high-durability sequestration continue to grow. Specific configurations and methodological trends for each project will be discussed in detail in Section A-2.

Investment Trends
This month, Big Tech and major financial institutions such as Microsoft, Amazon, and JPMorgan Chase continued to move actively. In mid-April, Bloomberg reported that Microsoft was temporarily pausing new carbon removal credit purchases (the company denied a total halt). This was followed on May 20 by the announcement of a 7-year BECCS agreement for up to 650,000 tons with Denmark's BioCirc, signaling a restart. It appears that the purchasing appetite of the market's largest buyer is in a phase of "adjusting pace and scale" rather than a complete cessation. As headwinds for climate policy strengthen under a potential Trump administration and it becomes increasingly difficult to promote pure climate measures in isolation, we believe the CDR and nature restoration sectors have entered a phase where they are increasingly required to be positioned complementarily with other benefits (such as energy security, regional economies, and agricultural revenue). For details, please refer to Section A-3: Detailed Commentary.

A. Market Trends for Voluntary Carbon Credits

A-1: Analysis of Credit Issuance, Retirement, and Investment Trends

Target Registries: VCS (Verra), GS (Gold Standard), CAR (Climate Action Reserve), ACR (American Carbon Registry), ART-TREES, Puro (Puro.earth), Isometric

Target Period: April 2026

Notes: Please note that companies are not required to register under their real names with the registries when retiring credits, so accuracy cannot be guaranteed. Furthermore, there may be delays in registry updates; therefore, the number of projects and status changes for this period may fluctuate in the future.

• Issuance: 13.77 million (Down 41.32% YoY)
  • By registry, Gold Standard (GS) accounted for 8.12 million units (approx. 59%), making it the largest issuer. This was followed by VCS with 4.30 million units.
  • By type, Energy (renewable energy, energy efficiency, etc.) accounted for approximately half at 6.85 million units, followed by Non-CO2 gases (waste handling, etc.) at 4.55 million units. Nature Restoration issued 1.90 million units.
• Retirement: 4.37 million (Down 6.26% YoY)
  • By registry, GS had the highest volume at 1.67 million units, followed by ACR (1.33 million) and CAR (1.15 million). These three registries accounted for approximately 90% of the total.
  • Retirements for Nature-based Solutions (NbS) projects were active. Specifically, TREES-labeled credits (REDD+) from the ART registry and North American IFM (Improved Forest Management) projects were the primary targets for corporate retirements.

The credit labels shown below are based entirely on information provided by each certification body (registry). Therefore, please note the following:

・Even if a methodology itself is CORSIA eligible or CCP approved, it will not be counted as a labeled credit in the table below unless the label information is included in the registry's data.

・Only the VCS and GS registries provide information regarding Article 6 labels.

Top Projects by Issuance

The following table shows the top 10 projects for which credits were issued in April 2026, as well as projects issued with labels (Article 6, CCP, CORSIA, Removal).

Issuance Performance by Label (Article 6)

This month, approximately 0.91 million units of Article 6 labeled credits were issued, which are expected to undergo Corresponding Adjustments under Article 6 of the Paris Agreement. These were primarily centered on cookstove projects in countries such as Cambodia and Rwanda.

Issuance Performance by Label (CCP)

CCP (Core Carbon Principles) approved labels by IC-VCM were issued for 1.60 million units. Approvals are progressing across a wide range of types, including waste handling (LFG recovery) projects in China and Brazil, Agricultural Land Management (ALM) in the United States, and Improved Forest Management (IFM) in Mexico.

Issuance Performance by Label (CORSIA)

Credits eligible for CORSIA, the emission reduction scheme for the international aviation industry, were issued for 1.01 million units. A Cambodian cookstove project (VCS-2925) accounted for the majority.

Issuance Performance by Label (Removal)

A total of 216,422 units were issued with Carbon Dioxide Removal (Removal) labels. This includes ARR (Afforestation, Reforestation and Revegetation) projects in Brazil, IFM projects in the United States, and Biomass with Carbon Removal and Storage (BiCRS) projects in India.

The NbS project with the highest retirement volume this month was the REDD+ program in Côte d'Ivoire (ART-130). This was due to a large-scale retirement by Chanel, as described below.

Retirements this month were led by Chanel, with notable large-scale retirements of REDD+ credits through the ART registry. Additionally, companies that consistently procure high-quality NbS/CDR credits, such as Disney and Boston Consulting Group (BCG), ranked high on the list. Disney, in particular, has consistently retired an annual average of approximately 200,000 tons since 2013, primarily from North American IFM and reforestation projects; its cumulative total of 2.69 million tons reflects this accumulation over more than 13 years.

Target Projects: Covers investments in Nature-based Solutions (NbS) and CDR.

Target Period: April 2026

Notes: "Credits" and "Group investment" only record announced figures; therefore, some fields may be blank.

This month, we present 14 key investment projects (9 NbS, 5 CDR). Notably, offtake agreements and funding from Big Tech and major financial institutions such as Microsoft, Amazon, and JPMorgan Chase in the fields of nature restoration and CDR were prominent. For more details, please see "A-3: Detailed Commentary Section."

A-2: Project Pipeline Analysis

Target Registries: VCS (Verra), GS (Gold Standard), CAR (Climate Action Reserve), ACR (American Carbon Registry), ART-TREES, Puro (Puro.earth), Isometric

Target Projects: Pipeline related to Nature-based Solutions and CDR

Target Period: April 2026

Notes: Due to slight time lags in registry updates, the number of projects and status changes for this period may fluctuate in the future.

Terminology: Annual ER refers to annual emission reductions or sequestration (tCO₂e).

This section covers new pipeline projects from the previous month in the areas of Nature-based Solutions (NbS) and Carbon Dioxide Removal (CDR), as well as updates on the pipeline from two months ago introduced in the previous newsletter.

Please note that the Listing Date in our database is either obtained directly from the registry or is based on estimates. Consequently, we do not guarantee the comprehensiveness or accuracy of the data.

There were 19 new registrations for Nature-based Solutions (NbS) projects in April 2026. Compared to last month's trends, registrations in Latin America, particularly Mexico, continue to be prominent.

By type, Improved Forest Management (IFM) accounted for 14 cases, representing approximately 70% of the total, followed by Afforestation, Reforestation and Revegetation (ARR) with 3 cases and Agricultural Land Management (ALM) with 2 cases. By country, Mexico was overwhelmingly the most frequent with 11 cases, all of which were IFM projects through CAR. This reflects the revitalized forest carbon market within Mexico.

Notable projects include: