Clinton Houston Mc Millan’s Post

🌍 SBTi's New Statement: A Progressive Step for Carbon Credit Markets? This week marked a significant milestone in climate strategy as the Science Based Targets initiative (SBTi) announced an update to their policy on carbon offsets. The SBTi has opened the door for companies to use carbon offsets to meet their Scope 3 emission targets. This adjustment represents a major pivot from their earlier stance, which strictly emphasised direct emissions reductions. The new approach has sparked a vibrant debate among stakeholders and raised concerns among SBTi staff. 🔍 Unpacking the Positive Impact and Addressing Concerns: 📈 Enhanced Carbon Market Dynamics: This new policy could lead to a surge in carbon credit transactions, with potential to cut up to 50% of Scope 3 emissions. 🌿 Accelerating Investment to Nature: By allowing carbon offsets for Scope 3 emissions, carbon projects are set to become a cornerstone of corporate climate strategies, speeding up investments into projects that not only reduce emissions but also support vulnerable communities, a key element of Earthly’s nature-based quality assessment. 📢 Addressing Internal Conflicts and Credibility: The decision has not been without controversy. Some SBTi staff have expressed significant concerns, calling for the resignation of key leaders and arguing that the move could reduce the priority given to the reduction of emissions and therefore undermine the initiative’s scientific credibility and focus. 🖐️ Five Optimistic Outcomes on Nature-Based Funding: ⬆️ Expect a significant increase in carbon credit transactions as companies strive to meet Scope 3 targets, spurred by enhanced regulatory and market pressures. 🌍 Annually, up to 13.5 GtCO2e could be offset, representing a substantial advance towards channeling funds toward nature protection & restoration. 💵 Billions more could flow into nature-based solutions, investments that could support everything from reforestation to wetland restoration. 📈 As demand surges, prices for high-quality nature-based carbon credits are expected to climb, boosting their investment appeal and unlocking more nature regeneration opportunities. 🌱 An increased focus on funding credible, impactful nature projects with verified benefits and significant ecological impacts, ensuring investments lead to tangible positive outcomes. 🔭 What’s Next? As we anticipate further guidance in July 2024, the SBTi's commitment to defining 'environmental attribute certificates' and establishing stringent standards for carbon credits is a promising development. At Earthly, we remain dedicated to assisting SBTi-aligned companies to navigate these new complexities. We are positive about the opportunities these changes create to channel significant funds towards nature protection and restoration and help close the $900 billion annual funding gap to nature. What’s your take on this? #SBTi #VCM #CarbonCredits

🌍 Understanding Voluntary Carbon Markets (VCM) and Their Future Potential As climate change continues to be a critical global issue, the role of carbon markets in mitigating its impact becomes increasingly important. JP Morgan's latest report, "Carbon Counts 4.0," provides valuable insights into the state and future of carbon pricing mechanisms, including Voluntary Carbon Markets. ❓What is VCM❓ VCM is a decentralized market where private entities voluntarily buy and sell carbon credits, known as Voluntary Emissions Reductions (VERs). These credits represent the reduction or removal of one metric ton of CO2 from the atmosphere. The market is governed by various private standards to ensure the environmental and social integrity of these credits. Five leading standards dominate the market: 1. Verra’s Verified Carbon Standard 2. Gold Standard 3. Clean Development Mechanism 4. American Carbon Registry 5. Climate Action Reserve Each standard adheres to common integrity principles like Additionality, Permanence, Robust Quantification, No Leakage, and No Double Counting. ❓How Does VCM Work❓ VCMs operate outside of government regulation, allowing companies and individuals to invest in carbon offset projects that reduce greenhouse gas emissions. These projects can range from reforestation efforts to renewable energy initiatives. Companies purchase these credits to offset their own emissions, often as part of their sustainability goals. Despite facing a recent confidence crisis due to oversupply and negative media reports, VCMs are showing signs of hope. Efforts to streamline principles governing both the supply and demand sides are underway, and political support from the USA has provided a boost to these markets. ❓The Role of SBTi❓ A key potential catalyst for demand in VCMs is the decision by the Science-Based Targets initiative (SBTi) to include VERs in their Scope 3 targets. This inclusion could significantly enhance the credibility and demand for VERs, driving more companies to participate in VCMs. ❓Looking Ahead❓ JP Morgan's report highlights that while challenges remain, VCMs have the potential to play a crucial role in achieving global Net-Zero targets. The ongoing developments and support for high-quality carbon offset projects offer a promising outlook for the future of VCMs. 🌿💼 #Sustainability #CarbonMarkets #ClimateAction #NetZero #ESG https://lnkd.in/daCSWYKz

The article discusses the challenges and opportunities associated with voluntary carbon markets (VCMs). It highlights that while VCMs have grown rapidly and can play a crucial role in financing various climate solutions, they are currently constrained by information asymmetry. This means that data and information about credits, including their performance and transaction history, are not easily accessible or used for decision-making. As a result, credits are often issued and priced based on subjective claims rather than verifiable emissions impact. The article emphasizes the need for transparency, reliability, and integrity in VCMs to ensure their effectiveness in addressing climate change. It also mentions the emergence of new companies attempting to tackle specific aspects of the VCM landscape. An interesting read. https://lnkd.in/diKJNK3J

Recent research has revealed that, despite ongoing criticism of Environmental, Social, and Governance (ESG) principles, a significant number of investors view climate change as a crucial aspect of business success. The study highlights the increasing recognition of climate-related risks as pivotal factors in investment decision-making processes. In fact, investors believe that investments related to the clean energy transition will outperform most other sectors and generate profits for investors in the short and long term. With an escalating number of environmental challenges facing companies, the imperative to prioritize sustainability initiatives will only intensify. This insight underscores the importance of aligning corporate strategies with long-term environmental goals, even amid the debate surrounding ESG’s role in the investment landscape. Read more here: https://lnkd.in/d84P7tEA #thomaslloyd #renewableenergy #infrastructure #esg #netzero #asia #climatechange #sustainability #emergingmarkets #energytransition #electricity #biomass

The World Economic Forum emphasizes the need for $4-5 trillion in #cleanenergy investments annually by 2030 to avert a climate disaster. A couple of weeks ago, our CEO Hirander Misra and Professor Lisa Wilson [Short], MD of XTCC, announced a Statement of Accord aiming to attract $100bn capital market investment into high-integrity #carboncredits. Serving as a financial and digital gateway for project funders and investors seeking returns, the Accord would help address the multi-trillion dollar annual climate financing gap. By fostering digitally interconnected collaboration and commitment across the climate value chain, we can create a positive climate impact that resonates across borders, ensuring a harmonious balance between environmental responsibility, community well-being, corporate sustainability, and global progress towards a circular economy. Let's all work together to align the #4Cs: Climate, Communities, Companies and Countries 👉🏼 Read the full article on: https://lnkd.in/g8zBsu83 👉🏼 Read our Statement of Accord call-to-action here: https://lnkd.in/d9yYZUEv #carbonmarkets #carbonfootprint #netzero #voluntarycarbonmarket #vcm Carbon Credits #zero13

The World Economic Forum emphasizes the need for $4-5 trillion in #cleanenergy investments annually by 2030 to avert a climate disaster. A couple of weeks ago, our CEO Hirander Misra and Professor Lisa Wilson [Short], MD of XTCC, announced a Statement of Accord aiming to attract $100bn capital market investment into high-integrity #carboncredits. Serving as a financial and digital gateway for project funders and investors seeking returns, the Accord would help address the multi-trillion dollar annual climate financing gap. By fostering digitally interconnected collaboration and commitment across the climate value chain, we can create a positive climate impact that resonates across borders, ensuring a harmonious balance between environmental responsibility, community well-being, corporate sustainability, and global progress towards a circular economy. Let's all work together to align the #4Cs: Climate, Communities, Companies and Countries 👉🏼 Read the full article on: https://lnkd.in/g8zBsu83 👉🏼 Read our Statement of Accord call-to-action here: https://lnkd.in/d9yYZUEv #carbonmarkets #carbonfootprint #netzero #voluntarycarbonmarket #vcm Carbon Credits #zero13

I highly recommend this short but important article about the need for building regional nuances in assessing the #decarbonization pathways of companies operating in emerging markets and developing countries (EMDCs). With the world moving towards #netzero, investors must ensure consistent and comprehensive #climateassessments of financed entities, considering the unique challenges faced by companies in EMDCs. Antonina Scheer and Carmen Nuzzo from Transition Pathway Initiative (TPI) dissect the complexities of decarbonization assessments in emerging markets, proposing nuanced approaches for climate finance strategies. The aim is to align financial flows with low greenhouse gas emissions in an #equitable way without delaying #transition. The challenge/opportunity is current assessment tools often lack the needed nuance, particularly for EMDCs. In that context, the authors offer three ways for investors to better understand EMDC circumstances: 1) Applying exemptions and grace periods for entities in certain regions 2) Using regional emissions benchmarks 3) Evaluating corporate entities within their policy contexts. With #financialinstitutions committing to #netzerotargets, rigorous climate assessments are non-negotiable. Recognizing the complexity is the linchpin to driving finance for a #global, #just, and #resilient #lowcarbontransition. https://lnkd.in/eFqnX4MK

Climate investing is changing. The focus used to be only on green “enablers,” the companies providing solutions to help support the global drive toward net-zero. Now many investors are realizing that if the goal is to decarbonize the real economy, that’s where capital needs to go. Their focus is shifting to include “improvers,” the companies – many in high-emission sectors of the economy – that are actively transitioning from gray to green. This expanded focus is where investors may potentially unlock value. Read our views on where we think investors can capture opportunities in the business of the low-carbon transition: http://ms.spr.ly/6044YfnWj

📢 The #US government recently announced a major push to bolster the voluntary carbon markets (#VCMs) as a tool for tackling #climatechange. Here's a breakdown of the key points:   ⭐ The Goal ⭐ Enhance VCMs to accelerate emissions reductions and lower the cost of #decarbonisation   💥 The Challenges 💥 • Credit Quality: Concerns about credits not reflecting real emissions reductions • Credible Use: Concerns about #integrity of claims and reputational risk • Barriers to participation: Regulatory uncertainty, high costs, and lack of #transparency 📃 Principles for #Responsible Participation in VCMs 📃 • High integrity credits: Credits must represent verifiable emissions reductions • Environmental & social responsibility: Projects should avoid environmental and social harm and promote positive social impacts • Prioritise internal reductions: Buyers should prioritise emissions reductions within their value chains • Transparent carbon credit use: Disclosure of credit use should allow observers to assess quality • Accurate climate claims: Claims should be made in line with high integrity standards and corporate • Support integrity initiatives: Stakeholders should collaborate to improve market functionality • Efficient market participation: Barriers (e.g., transaction costs, market uncertainty) should be addressed to incentivise investment and supply 💡 The US Government's Actions 💡 • USDA RFI: Seeking public input on protocols for high-integrity carbon credits from agriculture and forestry • DOE Pilot Programs: Directly purchasing carbon removal credits through the Carbon Dioxide Removal Purchase Pilot Prize and Carbon Negative Shot, and creating a leaderboard for voluntary purchases • Innovation Investments: Supporting research and deployment of carbon removal technologies • International Leadership: Participating in international standard-setting efforts (e.g. CORSIA, Article 6.4) and promoting high-integrity VCMs globally 🌱 The Bottom Line 🌱 Carbon markets are needed to #accelerate decarbonisation efforts and scale climate action – but #quality and #transparency are important. While carbon markets have the potential to unlock significant #privatecapital for innovative #climatesolutions, ensuring their long-term effectiveness will require robust standards and clear guidelines to encourage broad buy-in from participants. This is also where efforts by the US government form one of many important steps towards realising high-quality, transparent carbon markets. We look forward to further #collective efforts on this front.   https://lnkd.in/e2w2U4-y 🤔 What are your #thoughts on the role of VCMs in climate action? Share your views with us below. #ClimateChange #VoluntaryCarbonMarkets #Sustainability

✨ Allowing companies to use carbon credits to offset their #scope3 emissions could incentivize greater participation in #emissionreduction efforts, but it also raises concerns about the effectiveness and integrity of such credits. 🤔 The challenge lies in ensuring that #carboncredits genuinely lead to emissions reductions and contribute to meaningful #climateaction, rather than simply serving as a financial tool for #greenwashing #carbonmarket #vcm #greenfinance #emissionsreduction #carbonfootprint #scope3 #offset #sustainability #esg