Circular Economy

First 3 Carbon-Offset Programs Deemed Trustworthy by Integrity Council

In what it’s calling a new chapter of trust and standardization for the voluntary carbon market, the Integrity Council for the Voluntary Carbon Market gives three carbon-crediting programs its seal of approval.

Published 8 months ago | About a 8 minute read

Image: Renan Bomtempo

The Integrity Council for the Voluntary Carbon Market (ICVCM) — an independent governance body for the voluntary carbon market (VCM) created to ensure that the VCM accelerates progress towards addressing climate change — has launched a new chapter for the VCM, naming the first carbon-crediting programs assessed as meeting the high-integrity criteria set out in its Core Carbon Principles (CCPs).

American Carbon Registry (ACR), Climate Action Reserve (CAR) and Gold Standard have been approved as CCP-Eligible programs by the Integrity Council’s Governing Board. To achieve eligibility means the programs meet the CCP criteria for effective governance; transparency; tracking; and robust, independent third-party validation and verification. They have also met the program-related rules for the CCPs on robust quantification of emission reductions and removals, no double counting, and sustainable development benefits and safeguards.

In due course, ACR, CAR, Gold Standard and other CCP-Eligible programs — when approved — will be eligible to use the CCP label on new and existing carbon credits that are issued under CCP-approved methodologies. In combination, the Integrity Council’s assessments of carbon-crediting programs and methodologies aim to define what a high-integrity carbon credit looks like.

In parallel, the Integrity Council is progressing with the next batch of programs: Board consideration of Verra’s Verified Carbon Standard (VCS), Architecture for REDD+ Transactions (ART), Social Carbon and Isometric assessments are expected in April or at the latest in May. In line with its commitment to transparency, the Integrity Council is regularly updating its website with the progress of assessments. Carbon-crediting programs that have not applied are still able and encouraged to do so.

“We are delighted to announce the first results of our assessments and congratulate ACR, CAR and Gold Standard on meeting our rigorous criteria,” said Integrity Council Chair Annette Nazareth. “We are launching a new chapter for the voluntary carbon market: The CCPs set a global benchmark for high integrity — building trust, increasing standardization and making it easy for buyers to identify high-integrity carbon credits. This will help mobilize private capital at scale for projects to reduce and remove billions of tonnes of emissions that would not otherwise be viable and will channel investment to the Global South.”

The past few years have been rocky for the VCM — its efficacy and credibility of has been called into question after carbon offsetting became a cornerstone of many corporate climate-action plans. The Integrity Council was founded in early 2021 in an effort to set and enforce clear global standards, and improve the quality and governance of the VCM. After several well-known offset verifiers’ standards came under the microscope in 2023, the Council began assessing 100 carbon-credit methodologies — the rules that carbon-crediting programs set for designing and implementing different types of projects — against its high-integrity benchmark.

As CCP-Eligible programs, ACR, CAR and Gold Standard are now subject to the ongoing assurance and oversight functions of the Integrity Council, to ensure continued adherence to the CCP rules.

By the end of September, the ICVCM anticipates having largely completed assessment of methodologies covering more than half of the issued volume in the market — including Jurisdictional REDD, efficient cookstoves and new methodologies such as biochar — that are expected to rapidly gain market share. Carbon-crediting programs with a 98 percent share of the market have already applied to use the CCP label and are being assessed by the secretariat in parallel with the assessment of categories.

“We are really excited at the start of this next stage of our work at the ICVCM and are grateful for all the intense work over the last year of our independent experts and Governing Board members,” said Integrity Council Interim COO Amy Merrill. “The discussions and analysis in our multistakeholder assessment process meetings for categories of carbon credits are demonstrating the widely shared commitment of the market to this robust process and the value of this collaborative and structured way of assessing categories of carbon credits in the market.

“We are aware of market expectations and the urgency of introducing the CCP label to the market. However, it is critical to restoring trust in the VCM that we take the time needed to get this right. The methodologies we are assessing are complex; and consistency and care are essential.”

Programs have made changes to comply with the CCP criteria. For example, Gold Standard announced that it will update its registry to comply with the CCP requirements — a condition of the program’s CCP approval. When carbon credits are retired, they will need to provide information on the purpose of retirement and the entity on whose behalf they are retired. This change is designed to enhance accountability within the VCM.

“Gold Standard is delighted that our program is now CCP-eligible following the Integrity Council for the Voluntary Carbon Market’s assessment,” said Gold Standard CEO Margaret Kim. “We thank the Integrity Council for the collaborative way they approached this process and are delighted that we’ve been judged to comply with the CCP threshold.

“Building the integrity of the carbon market so it can deliver real impact where it is needed most is vital, and the CCPs represent an important step on this journey. As a pioneer of the inclusion of sustainable development and safeguarding in carbon crediting, we will continue to demonstrate integrity and innovate with our partners to deliver a just transition towards global net zero, maximizing sustainable development for the communities we serve.”

ICVCM says programs can exclude methodologies from the assessment process. Verra, for example, included its new REDD+ methodology for assessment — its previous REDD+ methodologies make up 27 percent of credits in the market; but it is creating a pathway that enables projects to transition to these latest versions.

CCP-labeled credits will appear on the market once the Integrity Council approves methodologies used by CCP-eligible programs. The Integrity Council is committed to keeping up the pace; so, the volume of CCP-labeled credits is anticipated to grow steadily over 2024.

“ACR has innovated and operationalized key elements of carbon-credit quality assurance — including scientific peer-reviewed accounting methodologies and well-accepted approaches to address additionality, leakage, and reversal risk mitigation; oversight of independent third-party verification; and operation of a transparent registry for the issuance and tracking of credits,” said ACR Executive Director Mary Grady. “So, we deeply appreciate this recognition of the rigor of our program, and we will continue to engage constructively with ICVCM to defend best practices in a world that is demanding not only carbon market integrity, but also inclusivity and urgency. ACR’s mission is to create confidence in the integrity of carbon markets; to that end, ICVCM offers an important way to harmonize standards around a global benchmark of quality.”

The Integrity Council has grouped more than 100 methodologies into 29 categories for assessment. The majority of categories raise complex issues in specific areas and are being assessed by expert Multi-Stakeholder Working Groups (MSWGs).

The first three MSWGs — considering improved forestry management (MSWG 1); sustainable agriculture; rice cultivation methane avoidance; nutrition/nitrogen management; buffer practices; afforestation, reforestation and revegetation (MSWG 2); and grid-connected renewable energy, mini-grids, renewable energy (MSWG 3) — have concluded their work, and these categories of credits are expected to come to the Board for decision in the coming months.
MSWG 4 — considering REDD+ (Reducing Emissions from Deforestation and Forest Degradation) and Jurisdictional REDD methodologies — is now underway.
MSWG 5 — considering clean cookstoves and household biodigesters — is intended to begin in late April.
MSWG 6, intended to begin in May, will consider several issues in sequence — including biochar, tech-based CCS, industrial biodigesters and other clusters of methodologies that require a more specialized review.

The Integrity Council’s approach to creating a high-integrity voluntary carbon market is modeled on that of a financial regulator. Its Core Carbon Principles and CCP Rulebook are the result of extensive consultation and set the rules of the market.

The now CCP-Eligible Programs will be subject to the Integrity Council’s assurance and oversight functions to ensure programs follow its high-integrity rules and properly monitor CCP labeling of carbon credits. It will audit programs, make spot checks and respond to complaints. If it finds material failings it will, after following due process and in a transparent manner, be able to suspend or terminate the eligibility of the program or methodology.

The Integrity Council intends to improve and strengthen its Assessment Framework over time — based on experience, the latest science and technology, and new developments in the market — and will study complex areas where it intends to raise ambition further in the next version of the CCP rules.

Full details of the assessment decisions and updates about the progress of ongoing assessments are available on the Integrity Council’s website here for programs and here for each category of methodology.