The supply side of the voluntary carbon market is currently not subject to any universally applicable regulations or generally accepted standards. Various private crediting programmes have developed different requirements to ensure the high quality of reduction certificates and the robustness of emission reductions. Recently, market-driven initiatives have emerged that seek to establish high and, above all, uniform standards for mitigation projects and their accounting. Meanwhile, there are also government initiatives to address uncertainty in the market in order to ensure uniformity, quality and transparency.
The German government and the European Union are jointly pursuing the goal of providing guidance and decision-making certainty to players in the voluntary carbon market. Through various initiatives, guidelines and legislative proposals, German and European policymakers are helping to address uncertainty in the voluntary carbon market.
Some of the key guidelines and regulations at the German and European level are explained below.
Empowering Consumers Directive
The Empowering Consumers for Ecological Change Directive (EmpCo) prohibits product advertising with statements such as ‘climate neutral/reduced’ or ‘climate positive’ based on offsetting with reduction certificates from 2026 onwards. However, references to offsetting will still be permitted. In principle, misleading climate statements and claims by companies to consumers should be avoided.
The guideline can be downloaded at https://eur-lex.europa.eu/eli/dir/2024/825/oj
German position paper ‘Paris-aligned carbon markets under the Paris Agreement’
The German government's position paper ‘Paris-aligned Carbon Markets’ focuses on the goals of the Paris Agreement and formulates key principles for action on the voluntary carbon market. The German government calls for market players to align their actions with the goals of the Paris Agreement when using global carbon markets, so that these lead to an increase in global ambition and advance the necessary transformation to net greenhouse gas neutrality.
To this end, the paper describes qualitative requirements for the supply and demand sides of the market to ensure that the VCM contributes to decarbonisation and green growth and helps to close the investment gap for climate change mitigation. This includes prioritising the avoidance and reduction of greenhouse gas emissions over offsetting emissions. At the same time, it emphasises the role of environmental and social integrity in the purchase of reduction certificates, which must be ensured by robust standards.
To this end, the rules for Article 6 of the Paris Agreement should be applied. Applying these rules to voluntary carbon markets will increase the potential of international carbon markets.
The position paper is available (german only) at https://www.carbon-mechanisms.de/publikationen/details/paris-aligned-carbon-markets-nach-dem-uebereinkommen-von-paris
Joint Statement on the Voluntary Carbon Market: The Claims Side
In December 2023, seven EU countries, including Germany, issued a joint statement addressing climate claims made by companies with regard to the voluntary carbon market. The statement includes recommendations for companies that wish to make climate claims based on purchased reduction certificates. The recommendations emphasise that robust standards and guidelines must be applied when using the VCM to ensure that mitigation projects deliver the promised reduction benefits and do not pose a threat to environmental integrity.
The document can be downloaded at https://www.government.nl/documents/publications/2023/12/10/joint-statement-on-voluntary-carbon-market
Guide to good practices in Voluntary Carbon Markets
The Guide to good practices for voluntary carbon markets, published by the Finnish government in 2023, provides guidance on identifying high-quality carbon credits. The guide was developed against the backdrop of an opaque voluntary carbon market and is intended to help increase the credibility of claims based on mitigation credits. To this end, the guide describes best practices for robust and effective mitigation projects, the benefits of reduction certificates from such projects, and appropriate communication of climate claims. Case studies demonstrate compliance with the minimum criteria and potential climate change mitigation projects.
The Finnish guide can be viewed at https://julkaisut.valtioneuvosto.fi/bitstream/handle/10024/164732/VN_2023_24.pdf
Due to the global nature of the voluntary carbon market, other (national) players have also published guidelines and regulations on the use of mitigation credits and related communication. An overview of initiatives can be found in the Carbon Mechanisms Research Policy Paper “Governing Corporate Claims” (Kreibich et al., 2022)
The Gold Standard Foundation has developed a comprehensive overview, the Carbon Market Regulations Tracker, on behalf of the BMWK. This provides standardised summaries and direct links to relevant regulations worldwide, both in the area of voluntary carbon markets and those relating to Article 6 of the Paris Agreement. Under ‘United Kingdom’, for example, information can be found on the British government's ‘Green Claims Code’, which is not described here.
In addition to guidance and regulation from public policy, private initiatives also formulate guidelines, standards and relevant information for corporate engagement in the voluntary carbon market, e.g. in the context of net-zero targets. Voluntary guidelines are intended to help identify high-quality reduction certificates, efficiently implement ambitious climate change mitigation measures within one's own company and minimise uncertainties on the voluntary carbon market. Some initiatives link their guidelines directly to tools, for example to identify high-quality reduction certificates. Such guidelines and the associated tools are listed under Practical implementation support. This section presents a selection of key initiatives and their central guidelines or guidelines from key players in the voluntary carbon market.
The Integrity Council of the Voluntary Carbon Market (ICVCM) aims to establish and maintain a global standard for high integrity in the voluntary carbon market. The organisation draws on a broad network of proven climate experts who support and critically monitor its work with their knowledge and experience. The initiative's high quality standards are reflected in the Core Carbon Principles (CCP), which comprise ten principles covering governance, climate impact and sustainable development. The ICVCM applies the CCP in two steps. First, it reviews individual crediting programmes for compliance with the CCP. If a crediting programme complies with the CCP, it is listed as CCP-eligible. In a second step, individual project categories are reviewed. Project categories that meet the CCP can be labelled with a seal from CCP-eligible crediting programmes, which identifies them as CCP-approved. The label is intended to make it easier for buyers to identify high-quality carbon credits. At the same time, the gradual tightening of requirements for crediting programmes and project categories is intended to raise the quality in the market.
The document can be downloaded at https://icvcm.org/core-carbon-principles/
Another key player is the Voluntary Carbon Markets Integrity Initiative (VCMI). While the ICVCM focuses on the supply side of the voluntary carbon market, the VCMI looks at the use of reduction certificates, thus placing emphasis on the demand side. The VCMI also pursues the goal of contributing to a high level of integrity in the voluntary carbon market. It focuses its activities on standardising the claims made by companies and the underlying measures. To this end, the VCMI has developed the Claims Code of Practice for companies that want to use carbon credits and communicate about corresponding reduction certificates. The Claims Code of Practice provides three different claims for this purpose. The claims (Silver, Gold, Platinum) differ in terms of the proportion of emissions covered by reduction certificates. For a Platinum claim, for example, a company must purchase a quantity of reduction certificates that corresponds to 100% of its emissions. For “Silver” (over 10% and less than 50%) and “Gold” (more than 50% and less than 100%), the required emissions coverage is lower. The basic prerequisite for all VCMI claims is the fulfilment of a series of requirements, such as the formulation of scientifically based reduction targets and the accounting of the company's GHG emissions.
This code can be downloaded at the following address: https://vcmintegrity.org/vcmi-claims-code-of-practice/
Finally, there are the Oxford Principles for Net Zero Aligned Carbon Offsetting. These were first published in 2020 and revised in 2024. The principles, developed by the University of Oxford, comprise four overarching elements: 1) Reducing emissions and ensuring that only carbon offsets with high environmental integrity are used to achieve net zero targets. In addition, the corresponding strategy should be reviewed regularly and adjusted in line with good practices. 2) When the net- zero target date is reached, all remaining emissions are offset with carbon dioxide removals. 3) There is a shift towards carbon dioxide removal activities with long-term storage. 4) The development of innovative and integrated approaches to achieving net zero targets is supported.
The Oxford Principles can be viewed at the following address: https://www.smithschool.ox.ac.uk/sites/default/files/2024-02/Oxford-Principles-for-Net-Zero-Aligned-Carbon-Offsetting-revised-2024.pdf
Cookie Settings
Cookies help us to constantly improve the website for you. By clicking on the "Allow cookies" button, you agree to the use of cookies. For further information on the use of cookies or to change your settings, please click on More about the use and rejection of cookies.
Marketing-Cookies werden von Drittanbietern oder Publishern verwendet, um personalisierte Werbung anzuzeigen. Sie tun dies, indem sie Besucher über Websites hinweg verfolgen.
Provider:
Statistik-Cookies dienen der Analyse und helfen uns dabei zu verstehen, wie Besucher mit unserer Website interagieren, indem Informationen anonymisiert gesammelt werden. Auf Basis dieser Informationen können wir unsere Website für Sie weiter verbessern und optimieren.
Provider:
Erforderliche Cookies sind für den reibungslosen Betrieb der Website zuständig, indem sie Kernfunktionalitäten ermöglichen, ohne die unsere Website nicht richtig funktioniert. Diese Cookies können nur über Ihre Browser-Einstellungen deaktiviert werden.
Provider:
