The Integrity Council for the Voluntary Carbon Market (ICVCM) has reached an important milestone in its efforts to enhance the credibility of carbon credits. The council has announced its plan to assess over 100 active carbon credit methodologies for adherence to the high-integrity Core Carbon Principles (CCPs). The first decisions on these assessments are expected to be made by the end of March. An expert group, consisting of members of the Integrity Council’s Governing Board, its Expert Panel, and external stakeholders, has categorized similar carbon credit methodologies into 36 different groups. These groups will undergo three types of assessments based on their complexity and issues.
The Core Carbon Principles (CCPs) are a set of 10 fundamental tenets for high-integrity carbon credits, supported by detailed criteria outlined in the CCP rulebook. The issuance of high-integrity CCP-labeled credits could facilitate the flow of climate finance to Global South countries, helping them achieve their national climate objectives. These credits will enable buyers to identify and support projects that effectively reduce and remove emissions, ranging from initiatives to safeguard and restore forests to the expansion of innovative clean technologies that are challenging to commercialize.
The Categories Working Group (CWG) has sorted carbon credit categories into three types of assessment. Categories covering 8% of carbon credits in the market will be assessed internally by the Integrity Council secretariat and members of its Expert Panel. This includes methodologies such as capturing methane from mines and landfill sites, detecting and repairing leaks in gas systems, destroying ozone-depleting chemicals, and reducing emissions of sulfur hexafluoride. Categories covering 47% of carbon credits in the market will be assessed by Multi-Stakeholder Working Groups. These categories, including renewable energy, efficient cookstoves, improved forest management, and REDD+ (Reducing Emissions from Deforestation and Degradation in Developing Countries), raise complex issues in specific areas. Categories covering 1% of carbon credits in the market, considered unlikely to meet CCP criteria, will be assessed once other evaluations are complete. These include new natural gas power, waste heat recovery, and industrial energy efficiency.
Certain carbon credit methodologies may be excluded from the assessment process at the discretion of programs. For example, Verra introduced its new REDD+ methodology for evaluation while omitting its prior REDD+ methodologies, which constitute 27% of the market credits. The organization has put forth only the latest versions of methodologies for specific project types and is developing a pathway to facilitate projects transitioning to these updated versions.
The major programs under assessment include those seeking approval to use the CCP label, which command a 98% market share. The secretariat is currently evaluating these programs alongside the assessment of categories. Approved programs meeting the criteria will be authorized to display the CCP label on both existing and new credits from approved categories.
Annette Nazareth, Integrity Council Chair, expressed the importance of the Core Carbon Principles in establishing a global benchmark for high integrity. She acknowledged that buyers are eagerly awaiting CCP-labeled carbon credits and emphasized the council’s commitment to considering complex issues and making the right decisions.
The Integrity Council expects to reveal the outcomes of its assessments by March. The organization has dedicated web pages on its site to track the progress of all categories and programs undergoing assessment. The decisions made by the Governing Board, along with their rationale, will be made public, and transparent explanations will be provided for any negative determinations. It is important to note that not all methodologies within a specific category may receive approval. Programs that require remedial action or are unlikely to receive approval will be notified and given the opportunity to submit their input and participate in a hearing before any final decisions are made.
The efforts of the Integrity Council align with the Voluntary Carbon Markets Integrity Initiative (VCMI), which focuses on ensuring integrity in credit use. Governments and regulators are increasingly considering the ICVCM’s Core Carbon Principles as an international standard for incorporation into their frameworks. The UK, for instance, has expressed its intent to endorse the CCPs and explore their integration into policies, regulations, and guidance. The Monetary Authority of Singapore is also actively exploring how to align its transition credits with the CCPs. In the US, the Commodity Futures Trading Commission has published draft guidance aligning carbon credit derivatives listings with the CCPs.
The ICVCM’s milestone achievement aims to enhance the credibility of carbon credits, support climate finance in Global South countries, and assist buyers in identifying top-notch projects. The assessment process, which includes internal and multi-stakeholder assessments, will result in approved programs displaying the coveted CCP label on their credits.