New voluntary carbon market rules could provide lifeline to world’s forests

The Voluntary Carbon Standard (VCS) provides quality assurance for certification of voluntary carbon offsets and its extension to include agriculture, forestry and other land use projects (AFOLU), aims to drive much-needed investment into protecting forests from deforestation. Up until now, most emission-reducing forestry and agricultural projects have been excluded from international carbon markets because of concerns over accurate measuring of their emissions and their environmental sustainability.

“They have been left out of the EU Emissions Trading Scheme, made complex in the CDM (the Kyoto Protocol’s Clean Development Mechanism) and are not covered by the Gold Standard,” said Mark Kenber, chairman of the VCS Association. “Robust new rules introduced under the Voluntary Carbon Standard change all that and demonstrate that forestry and agriculture projects can be credibly accounted for, which will be very important for future regulatory schemes.”

The launch of the new VCS rules, follow the publication last month of an independent report commissioned by the UK Government, warning of the urgency to curb deforestation in order to avoid the worst impacts of climate change and financial devastation.

The Eliasch Review, Climate Change: Financing Global Forests, said public and private sector funding, including the voluntary carbon market, was urgently needed to halve deforestation by 2020.

Agriculture and forestry account for around a third of all global greenhouse gas emissions – more than all the world’s vehicles, planes and ships combined.  

The voluntary carbon market, meanwhile, is currently valued at £200 million, with forestry offsets accounting for around 18 per cent. The quality assurance provided by the new VCS rules is expected to grow the offset market significantly, with some estimates putting the total voluntary carbon market value at £2.5 billion within the next four years.

“For the first time ever, investors can rely on robust rules for crediting AFOLU project activities, creating valuable new market opportunities,” said David Antonioli, chief executive officer of the VCS Association.

Conservation bodies claim forestry projects have a particular appeal to investors, not just because of their carbon benefits, but also because of their potential to create sustainable livelihoods in developing countries and to protect threatened biodiversity.

“The VCS rules will not only boost market confidence in forest carbon activities but also, for the first time, enable projects that benefit local communities and biodiversity to access significant new global investment,” said Toby Janson-Smith, a director with environmental NGO Conservation International.

The new VCS regulations, which come with an independent recommendation from the Stockholm Environment Institute, which described them as “thorough and innovative”, have been launched following 18 months of consultation with a wide range of interested parties and were compiled by 20 leading AFOLU experts.

The VCS, which was launched a year ago, is the most popular single standard for voluntary offset projects and its certification rules claim to be as robust as those of the Kyoto Protocol’s CDM.

The standard was developed by The Climate Group, the International Emissions Trading Association, the World Business Council for Sustainable Development and a range of business, government organisations and NGOs.