What are carbon credits standards and why are they important?
We’ve had a few questions lately on how standards are related to carbon credits. So we’ve put together some quick facts on carbon credit standards – all the essentials that you need to know.
What is a standard?
Standards are basically a set of rules to ensure that the particular product, (be that carbon credits, buildings, investments, you name it), meets minimum qualities. A high quality standard ensures a higher quality outcome. For carbon credits, this means you want to choose a credible and stringent standard to ensure you can make a genuine environmental claim.
What underlies the standards?
Carbon credit standards are built upon a number of guiding principles. The breadth and depth of the principles dictates the quality of the credits project that the standard will accept. The following principles are the very minimum set of rules that any reputable carbon credit standard should include:
- Additionality: the emissions reduced, avoided, or sequestered by the project are additional to business as usual, or would not have occurred without the carbon finance.
- Permanence: the carbon credit is permanent and won’t be reversed.
- (Avoidance of) leakage: emissions haven’t occurred outside of the project, because of the project.
- Measurable: the carbon credits being claimed are quantifiable (using an appropriate methodology).
- Verifiable: an independent third-party has assessed the project and data.
- Transparency: reports must be publicly available.
But, as you know our standards are high, so we also require a number of other principles. These include ensuring that the carbon credits can’t be double counted (where a carbon credit is used to offset more than once) and they contribute to sustainable development through co-benefits like improving air quality, waterways or supporting local communities). We have quite a few more that we check against, please get in touch with us to discuss our rigorous assessment further.
What are the checks and balances?
In order to ensure that any project is accepted, a good standard organisation would generally review design of the project, the stakeholder engagement, safeguarding plans and ongoing monitoring results. This would also include independent, third-party reviews at multiple points for extra robustness. Outside of this process, the registry that then holds the credits in the market is part of the assurance that there is no double counting.
So which ones does Toitū choose?
We choose standards addressing those important attributes above. We also make sure that in the post-2020 Paris context, double claiming and additionality are given additional scrutiny. We have confidence that the Gold Standard, Fairtrade Gold Standard, Clean Development Mechanism and Permanent Forest Sinks Initiative all meet the required attributes. We also review other standards on an ongoing basis.
But the assessment of the standard is just the first part. We then individually check the projects under accepted standards to ensure they meet our high benchmark and that there are no unforeseen environmental or social impacts with any projects.
This is Toitū here, so you know there’s some sort of independent endorsement of our own work
We are a member of the International Carbon Reduction and Offset Alliance (ICROA) which is comprised of the leading global service providers in the voluntary carbon market. Our credit selection is aligned with their code of best practice. It’s also taken a step further and our selection is audited against the code, ensuring our choices are best practice.
Get in touch if you want to make sure your emissions offsetting is done with credible, real carbon credits.