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We have been striving to decrease the concentration of Greenhouse Gases (GHGs) in the atmosphere. Primary among some of the gases that cause the greenhouse effect is carbon dioxide (CO₂), used as a standard measure for carbon credits. Therefore, one ton of CO₂ not emitted or removed from the atmosphere is equivalent to one carbon credit.

To obtain a certified carbon credit, it is necessary to develop a Carbon Credit Project. This project must follow a specific methodology and must respect the eligibility criteria. The main criteria are:

  • Additionality: It is one of the criteria considered to define the eligibility or not for a carbon credit. Demonstrating the additionality of a project means demonstrating that the project goes beyond business as usual (BAU) practices, i.e., that the activities foreseen in the project have, as a specific purpose, environmental and/or social service benefits that would not normally be performed if the project were not implemented.  The additionality of a project cannot be precisely calculated, but certain certification systems indicate a number of methods to test it. Some carbon credit methodologies provide additionality tests, which are useful when designing the project. The latest methodologies establish a control area for comparison and proof that the project activities are additional;
  • Duration/Timeframe: For a carbon credit project, longevity is one of the most important things, and is directly linked to the time that the developed activity - such as reforestation - will sequester carbon dioxide from the atmosphere. When talking about avoided emissions projects, the process change carried out, in most instances, will endure over many years, but the methodological standards establish a limit for the emission of carbon credits;
  • Dispersion/Leakage: Especially for projects involving Land Use, Land Use Change and Forestry, an analysis is made regarding the displacement of activity prior to the carbon credit project that was done in the area, that is, it is required that the reforestation activity in this area will not imply deforestation in another;
  • Monitoring: When developing the project, the management plan for the proposed activities is also outlined. Thus, it is necessary to monitor the operational activities and the corresponding information from our databases and the activities proposed in the carbon credit projects. This monitoring is factored into the verification by an independent third party of the project and the issuance of the carbon credit.

 

Main Standards and Certifiers
UNFCCC - Clean Development Mechanism (CDM): The Clean Development Mechanism was the first global environmental crediting and investment scheme of its kind, developed by the UNFCCC under the Kyoto Protocol (1997). Through the Paris Agreement (2015), the CDM will be discontinued and replaced by the Sustainable Development Mechanism established in Glasgow at COP26 (2021). The operationalization of this new mechanism will be further defined and put in place in the coming years.


Verra – Verified Carbon Standard (VCS): Verra is an institution created in 2005, recognized worldwide as a specialist in certifying carbon credit projects. It establishes methodologies that evidence the battle for climate change through the removal of carbon dioxide or reduction of GHG emissions, as well as providing additional requirements that lead to complementary benefits to the environment and society. The VCS methodology is one of the most widely used worldwide and was developed by the International Emissions Trading Association (IETA) Climate Group, the World Economic Forum (WEF), and the World Business Council for Sustainable Development (WBCSD).


Gold Standard: Established in 2003 by WWF and other international NGOs to ensure that projects that reduce carbon emissions under the UN Clean Development Mechanism (CDM) also contribute to sustainable development.


Social Carbon: Developed by Instituto Ecológica, a Brazilian non-profit entity, it certifies carbon reduction projects for their contributions to sustainable development.

Credit Generation Guidelines