Millions of high-integrity forest carbon credits to be issued from 2025

The Integrity Council for the Voluntary Carbon Market (ICVCM) has approved three methodologies to issue carbon credits from forest activities, to be labelled with its Core Carbon Principles from 2025.

The methodologies belong to the ‘Reducing emissions from deforestation and forest degradation in developing countries’ (REDD+) denomination created by the UN as part of the Paris Agreement.

Though popular among corporate buyers for their added benefits in restoring biodiversity, REDD+ credits have been some of the most controversial so far, with several scientific studies questioning their carbon absorption potential in the past few years.

In this context, the ICVCM’s seal of approval – which is not easily obtained, as renewable energy projects discovered in August – is set to create new demand for forest credits and infuse new life in the voluntary carbon market, whose value went down 61% in 2023 as developers and buyers awaited new integrity guidance.

Priority to jurisdictional forest projects

The three methodologies that will soon be able to issue Core Carbon Principles (CCP)-labelled carbon credits are the ART REDD+ Environmental Excellence Standard (TREES) v2.0 (which is only used on large-scale government-led or ‘jurisdictional’ projects), and two Verra-managed Verified Carbon Standard methods: VM0048 Reducing Emissions from Deforestation and Forest Degradation v1.0, and Jurisdictional and Nested REDD+ Framework v4.1.

The standards were assessed based on their ability to address and remedy integrity concerns: for instance, under VM0048, project developers no longer set their own baselines (a practice that could allow them to overstate the carbon reduction potential of their projects). Instead VCS will establish project baselines, based on jurisdictional deforestation data, combined with an assessment of deforestation risk in the specific project area. 

Gabriel Labbate, co-chair of the Integrity Council’s Expert Panel, said: “These approved methodologies have demonstrated that they have significantly improved the integrity of REDD+ methodologies. Throughout the assessment process we found that they have rigorous approaches in place to ensure additionality, permanence, robust quantification and social safeguards, among other criteria.”

None of the approved methodologies have issued credits to date, but they are expected to start from early 2025, with “a large volume of credits in the pipeline”, ICVCM says: 123 million credits in nine jurisdictions for ART TREES, 300 million credits in 21 projects under VM0048, and five projects under Verra’s JNR Framework.

‘A new chapter for nature in the carbon markets’ 

Amy Merrill, Integrity Council CEO, commented: “There is no chance of meeting our climate and biodiversity goals without increased finance for nature, Indigenous Peoples and local communities. The assessment process has concluded that these approved methodologies are robust and that they manage risk effectively. These decisions are important, bringing the confidence needed to underpin investment and marking the start of a much-needed new chapter for nature in the carbon markets.”

Two other crediting methods from the ART TREES standard are still in the assessment process, with decisions expected by the end of 2024, along with decisions on clean cookstove methodologies (which were recently the subject of a fraud controversy).

Meanwhile, older REDD+ methodologies from Verra (including VM0006, VM0007, VM0009, VM0015 and VM0037) were not submitted for assessment, and will not be able to receive the CCP label. These are expected to be phased out, as Verra now requires certain projects that were developed using older methodologies to transition to VM0048.