Figure 1 shows some of the crediting standards and mechanisms that are available in the market. The report – Overview and Comparison of Existing Crediting Schemes provides a comparison of different standards and mechanisms. Some of these only deal with carbon credits from particular sectors such as forestry e.g., Regen Network, REDD+ and others such as Verra and Gold Standard allow carbon credits from multiple sectors.
UNFCCC: Clean Development Mechanism (CDM)
The CDM is a flexible mechanism defined in Article 12 of the UNFCCC Kyoto Protocol, which for the first time allowed industrialised countries (known as Annex 1 countries) to compensate for their emissions with credits from developing countries (known as Non-Annex I countries). The mechanism introduced a standardized instrument, the Certified Emission Reductions (CERs) credits, each equivalent to one tonne of CO2. The Protocol was adopted on 11 December 1997 but entered into force only on 16 February 2005 with implementation agreed for the first five years: 2008-2012. In Qatar, on 8 December 2012, the Doha Amendment to the Protocol was adopted for a second commitment period: 2013-2020. As of March 2022 (article), CDM has issued nearly 3 billion tonnes of CO2, with around 8,000 projects registered – and clean cooking contributes a substantial portion of this issuance.
UNFCCC: Article 6.4 Mechanism
The Paris Agreement in 2015 effectively replaced the Kyoto Protocol and the CDM infrastructure is now being adapted and amended for implementation of the Paris Agreement’s Article 6.4. The standards and procedures for the transition of CDM projects to Article 6.4 mechanism, will be effective from 1 Jan 2024. It is then expected that projects under temporary measures in this transition period would start to generate the Article 6.4 units, each equivalent to a tonne of CO2. Projects under transition measures are those that requested registration, or renewal of crediting periods, on or after 1 January 2021. Countries can then trade, or use issued Article 6.4 credits to meet their NDCs. The Article 6.4 mechanism related rules, modalities, procedures, and guidelines will be evolving with further implementation of the Paris Agreement.
Verra: Verified Carbon Standard (VCS)
The VCS Program is Verra’s signature crediting mechanism which is the world’s most widely used GHG crediting program. Verra is registered as a not-for profit organization founded in 2007, which serves as a secretariat to various standards. It issues Verified Carbon Units (VCUs) each equivalent to one tonne of CO2. In terms of volume, it is the largest voluntary standard in the world as of September 2023, having certified reductions of more than 1.1 billion tCO2 from more than 2,000 projects in 88 countries since 2006 – in a wide range of sectors. The VCS Program is also endorsed by the International Carbon Reduction and Offset Alliance (ICROA) and meets the ICROA Code of Best Practice.
Gold Standard (GS)
The GS is a foundation established in 2003 by WWF and other international NGOs to ensure projects that reduce carbon emissions featured the highest levels of environmental integrity and contributed to SDGs. It has evolved its work around the Paris Agreement and the SDGs, and launched the Gold Standard for Global Goals (GS4GG) in 2017, which seeks to leverage climate actions for greater impacts. It issues Verified Emission Reductions (VERs), each equivalent to one tonne of CO2. As of September 2023, nearly 3,000 projects from 100 different countries have been registered generating 266 million tCO2 with a shared value of US $41 billion. SustainCERT is the official certification body for GS4GG which manages certification for GS’s carbon offset project portfolio.
Cooking credits in the VCM are largely issued by VCS and GS. Clean cooking projects represent nearly 20% (841 projects) of all the projects registered with the voluntary carbon standards with more than 90 million credits issued – as of Jan 2023. Just under one-third (27%) or 224 of these projects distribute cooking fuels or stoves that meet the 2014 World Health Organisation (WHO) definition of clean attributes, that is, they meet Tier 4 or higher rating across the six measurement attributes of the Multi-Tier Framework. This means that the majority of VCM cooking project activities replace traditional biomass stoves (i.e., three stone fires or inefficient biomass stoves) with improved biomass stoves – indicating Tier 3 transitional or, in the worst cases, even Tiers 1-2 polluting stoves – with marginal benefits. Most of these projects using Tier 4 and above solutions (218) are registered with the GS and only five projects are registered with the VCS. The credits generated by these projects amount to 25 million – around 28% of the total registered cooking projects.
This report – The Role of Voluntary Carbon Markets in Clean Cooking released on 6 April 2023 provides some detailed insights on the current state of the VCM.
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