Under the CDM, the responsibility to assess the SDG impacts lay with the DNA – which will continue under Article 6.4 mechanism. The “Article 6.4 mechanism sustainable development tool” will be developed which requires projects to provide a summary of the analysis and a monitoring plan of SDG impacts and planned remedial measures of negative impacts. This is expected to be an adapted version of the CDM SD tool used to create a thorough SDG co-benefits report. The SDG Tool offers project developers an opportunity to provide vital co-benefit information to its stakeholders.
Under GS, its SDG Impact Tool (Excel based) lays out the Monitoring Indicators to help project developers identify the SDG benefits of their projects. The use of the tool is mandatory for all new projects submitted after March 14, 2022. GS requires projects to demonstrate a clear contribution to at least three SDGs, one of which must be SDG 13. Projects can either include SDG impacts as general estimates of co-benefits together with carbon credits or use dedicated methodologies to calculate those benefits – which could be marketed separately.
Table 1 shows the most common SDG claims and indicators based on an analysis of the GS portfolio of clean cooking projects. More details can be found in More Than Just a Carbon Project report. Most benefits are measured at the activity level and simple cross-sectional surveys are the preferred method for monitoring these benefits, as questions about co-benefits can be easily added to the surveys that are required to estimate the emission reductions. It is often difficult and resource intensive to establish a causal chain from an activity to an impact, even where there are well developed methodologies. In other cases, it is difficult to quantify benefits because clear methodologies are not readily available. Consequently, to date project developers have tended to use simple if often imprecise indicators.
| SDG | Most Common Claim | Most Common Indicators | Most Common Means of Measurement |
|---|---|---|---|
| SDG1: No poverty | Reduced fuel expenses | Percentage of households confirming savings | Survey |
| SDG2: Zero hunger | Increased agricultural output | Percentage of households reporting bio slurry application to fields | Survey |
| SDG3: Good health and well-being | Indoor air quality | Percentage of households confirming reduced smoke while cooking | Survey |
| SDG4: Quality education | Training provided | Number of trainings delivered | Survey |
| SDG5: Gender equality | Time saved | Number of hours saved | Survey |
| SDG7: Affordability and clean energy | Access to affordable and clean energy services | Percentage of households reporting stove use | Survey |
| SDG8: Decent work and economic growth | Employment opportunities | Number of employees hired | Employee records |
| SDG12: Responsible consumption and production | Reduced biomass consumption | Reported tonnes biomass saved per year | Survey |
| SDG15: Life on land | Reduced deforestation | Reported tonnes firewood saved per year | Survey |
Project developers can also use GS developed impact quantification methodologies available for Black Carbon (BC) reduction and health improvement. The BC methodology quantifies the reduction in BC and the health methodology quantifies the Averted Disability Adjusted Life Years (aDALYs). aDALYs are a commonly used metric for public health reporting which represent the number of years of healthy life made possible by a clean cooking intervention. A summary of these GS Co-benefit Methodologiesis provided here.
GS has also developed a “Gender Equality Requirements and Guidelines” which carries out two levels of certification. Under this, “Gender Sensitive” certification is mandatory for all projects and “Gender Responsive” certification is optional and applicable to the activities implementing a pro-active gender responsive approach aligned with SDG 5.
International Finance Corporation’s latest brief “Clean Impact Bond: Mobilizing Finance for Clean Cooking” showcases the application of GS co-benefit methodologies and guidelines for health and gender as part of piloting a Clean Impact Bond (CIB) for a domestic biogas project in Kenya. As part of CIB, IFC provided a senior loan to BIX Capital which then on-lent it as working capital (US $300,000) to Sistema.bio to install domestic biogas plants which is to be paid back at market rates over 3 to 5 years. The Osprey Foundation purchases the health and gender co-benefits (Total maximized at $500,000) at $1,816/aDALY of health benefits and at $1/added Quality Hour of gender benefits. Cardano Development manages the credit transfers to Osprey Foundation and payments to both BIX Capital and Sistema.bio. Table 2 shows the impacts and their values that the households could generate which are significantly higher than the carbon revenues as per the current market prices.
| SDG Type | Metrics | SDG Contribution | Impact Value |
|---|---|---|---|
| SDG 3: Good health and well-being | Averted disability adjusted life years (aDALYs) | 0.0578 aDALYs (21.2 days of healthy life) per household per year | US $105 per household per year |
| SDG 7: Gender equality | “Quality Time” – Increase in women’s time used for productive tasks and/or rest/leisure | 285 hours of quality time (about 12 days) per household per year | US $285 per household per year |
Project developers can also consider using the W+ Standard, which is a framework to quantify the social capital created by women in six domains: Time, Income & Assets, Health, Leadership, Education & Knowledge, and Food Security. An example of this for a biogas project in Nepal is available here.
Verra has also developed its Sustainable Development Verified Impact Standard (SD VISta) program which is a flexible framework for assessing and reporting on the SD benefits. Methodology for Time Savings from Improved Cookstoves (ICS) is presently under development and going through assessment.
………………………….
Click here to go back to the carbon financing main menu.