If there is one subject that is guaranteed to divide environmentalists, then it is the rise of carbon offset and credit schemes.
For some campaigners, they are a dirty word. They argue such programs are nothing more than a glorified “get out of jail card” for polluting nations or corporations to carry on as normal, instead of taking a more serious approach to sustainability.
Others take a more pragmatic approach and point to the financial support they can provide to protect forests, wetlands and communities in developing countries all over the world.
Whichever side of the fence you are on, the one thing everyone can agree on is that carbon markets are going to be big money.
The recent decision by negotiators at the COP26 conference in Glasgow to set firmer rules for carbon markets and include them in Article 6 of the Paris Rulebook means countries will be able to partially meet their climate targets by buying offset credits.
Elena Belleti, a research director at analysts Wood Mackenzie said following that COP26 inclusion, the value of the market could surge from $1 billion in 2021 to nearly $200 billion in 2050.
“In the near term, price volatility will continue,” added Ms Belleti. “But by 2030 demand for high-quality credits could drive prices up more than tenfold, allowing the financing of real emission reduction.”
MORE FOR YOU
But many people still have reservations about the burgeoning market.
“We as consumers may be taken in by clever accounting and over-stated claims by carbon off-setters, but you cannot trick the atmosphere,” said Jim Elliott, senior policy adviser at Green Alliance.
“Unless carbon removal credits are accurately measured, genuinely additional and used only once they will contribute nothing to keeping global heating below 1.5 degrees, and could actually make climate change worse.”
The big issue for the carbon offset sector is how to make their products more transparent and ensure that any successes are measured accurately and honestly. How can this be achieved?
As improbable as it sounds, the answer may lie in outer space.
Or to be more specific, it lies with the many satellites that are orbiting the world around us. They can provide a watchful eye on what is actually going on, on the ground and use artificial intelligence to monitor the progress being made.
Ariella Charny, CMO of Albo Climate, which analyses satellite imagery to monitor carbon sequestration on the ground, said they are seeing a “scramble now for high quality nature-based projects”.
“What’s been keeping this critical sector from scaling is the monitoring, reporting and verification (MRV), so we’re developing next-generation, AI-powered technology to create more transparency and accessibility for carbon credit verification around the globe.”
Albo Climate has been working with various partners to use high-definition pictures taken by satellites to monitor deforestation and forest degradation at scale and evaluate the health of local and regional ecosystems.
Ms Charny said the images can monitor patches of land as small as 10 by 10 metres and their platform can also link carbon credits to specific pixels.
“This means that someone can see what is going on in that specific plot of land,” explained the firm’s CEO, Dr. Jacques Amselem. “You are not just buying a forest conservation promise – here, you can track exactly what you are purchasing.”
Dr. Amselem said the platform would make the carbon offset credit market scale up. Plus, by working at such a micro-level, it would also enable small landowners and farmers to participate.
“We can look at that kind of level of granularity,” added Ms Charny. “We want to involve more smallholder farmers. We had great meetings with some big food companies last week. They work with a lot of farmers in the developing world who are largely barred now from the carbon credit market.
“They could be part of the fight against climate change and improve their own yields with some initial capital investment. They could also make the supply chains more sustainable. There are so many benefits. A big part that’s been missing is the finance and MRV technology.”
Dr. Amselem said they are looking at developing a carbon microcredit scheme, which could particularly help farmers and small landowners.
“Imagine landowners all over the world being able to prove through technology that they’re sequestering carbon to participate in this market, and it’s going to be a big market,” he said.
He added their platform can also monitor methane emissions – a growing area of global focus following the methane pledge from COP26 – although for the moment they are concentrating on carbon.
Recently, Albo Climate has been working with Tembo Climate to produce high-resolution carbon models of vulnerable tropical forests in several Sub-Saharan Africa countries.
The two companies will also develop carbon credits from two national parks in Cameroon, which need protection against deforestation.
“Most of the money from the carbon credits will be used by the communities in very direct ways,” added Ms Charny. “The money is used to finance, for example, new jobs in agroforestry, anti-poaching teams and park rangers. It’s a very holistic approach that engages the people on the ground.”
“The money could be used to finance adaptation mechanisms for frontline communities in the region and compensate local stewards for their efforts to shape a more sustainable landscape while reducing CO2 emissions. Through data-driven verification, Albo Climate’s technology enables accessible investment in natural climate solutions and empowers individuals on the ground successfully managing these projects,” added Albo Climate’s marketing manager and climate activist, Sharona Shnayder.
“Not to mention the co-benefits typically associated such as improved air quality and species protection.”
Love it or loathe it, the carbon credits market is here to stay. The onus is on the sector to disprove the inevitable accusations of greenwashing and highlight the valuable contribution it can make around the world. This growing market must rise up to the challenge and embrace transparency. Plus it must also ensure that everyone in the supply chain benefits, from NGOs to small landowners. Then it will truly become a game changer in sustainability.