Voluntary carbon credits are tradeable certificates that represent the reduction or removal of one metric tonne of carbon dioxide (CO2) or its equivalent in other greenhouse gases. These credits can be purchased by individuals, companies, or organisations looking to offset their carbon footprint. The projects generating these credits include initiatives like reforestation, efficient cookstoves, and other sustainable practices. Carbon credits were defined by the UNFCCC in 2005, after the ratification of the Kyoto Protocol and constitute a virtuous mechanism that allows you to attract investments in carbon projects (eg reforestation) that would otherwise not be financially sustainable. 

Gold Standard and Verra are among the most recognized certification bodies that ensure carbon credit projects meet rigorous environmental integrity and sustainable development standards. The standards focus on certifying that stated greenhouse gas reductions are real, quantifiable, and verifiable.

Outcomes of carbon credit projects are rigorously measured and reported through:

• Regular monitoring and verification by third-party auditors to ensure that the projected carbon savings are achieved.

• Use of established methodologies to quantify carbon savings and other environmental impacts.

• Publicly accessible reports and updates provided by the certification bodies like Gold Standard and Verra, which help maintain transparency and accountability.

• Continuous local engagement and impact assessments to monitor the social and environmental effects of the projects.

Native species reforestation involves planting indigenous trees and plants, which helps restore the natural biodiversity of an area. This method:

• Supports local wildlife and promotes ecological balance.

• Improves soil health and water cycles.

• Is more resilient to pests and diseases.

Mangrove reforestation is highly effective in carbon sequestration because mangroves store significant amounts of carbon in both their biomass and the soil.

Additionally:

• Mangroves provide critical protection against storm surges and erosion.

• They support diverse marine ecosystems.

• Mangrove forests are vital for the livelihood of coastal communities through fisheries and tourism.

High-quality nature-based solutions (NbS) refer to actions to protect, sustainably manage, and restore natural or modified ecosystems that address societal challenges effectively and adaptively, while simultaneously providing human well-being and biodiversity benefits. These include reforestation, wetland restoration, and sustainable agriculture practices.

Purchasing carbon credits is a way for companies to offset emissions they cannot eliminate through direct reduction strategies. While it doesn't reduce the company's immediate emissions, it contributes to global emission reduction by funding projects that either reduce or capture greenhouse gases elsewhere. This can be part of a comprehensive carbon management strategy, including both reductions in direct emissions and offsets through credits.

Native species reforestation specifically involves planting trees and vegetation that are indigenous to a given area, as opposed to introducing non-native or commercial species. This approach:

Maintains the historical and natural landscape of the region.

Supports local biodiversity more effectively than non-native species.

Reduces the risk of invasive species outbreaks, which can harm the ecosystem.

Although engineering removals may have potential as CCS in power plants, it is usually highly inefficient to capture CO2 directly from the air with machines. It is much more cost effective and scalable to plant forest and mangroves, not to mention the additional social and biodiversity externalities which are only possible with naure-based solutions.

Direct Air Capture cost: $1,000 per tonne of CO2 captured

Reforestation: $3 per tonne of CO2 captured

To ensure the effectiveness of carbon credits, one should:

Verify that the projects are certified by reputable standards like Gold Standard and Verra.

Look for transparency in how the funds are used and the impacts are reported.

Choose projects that have clear, measurable outcomes and regular monitoring reports.

These FAQs can serve as a foundation to educate visitors on the importance of carbon credit projects, specifically highlighting the benefits of focusing on nature-based solutions. They can be further customized to align with specific organizational goals and the particulars of individual projects.

Environmental Impact: Investing in nature-based solutions helps preserve ecosystems and biodiversity, providing a robust response to climate change and environmental degradation.

Regulatory Compliance and CSR: Purchasing these credits can help companies meet regulatory requirements and enhance their Corporate Social Responsibility (CSR) profile.

Reputational Benefits: Supporting green projects can significantly boost a company’s image as a sustainable and environmentally conscious entity.

Risk Management: By investing in diverse ecological projects, companies can hedge against the risk of stricter future environmental regulations.

Employee and Customer Engagement: Showing commitment to sustainability can increase employee pride and customer loyalty.

A Carbon Footprint measured in tonnes of CO2   equivalent ([tCO2e]) is the calculation of greenhouse gas emissions (GHG)       of any activit, including not only the direct emissions (called Scope 1) of the company, but also all the indirect emissions deriving from the use of electricity supplied to them (called Scope 2) and indirect emissions from the supply chain of the company (called Scope 3). 

The sum of the three scopes is the total carbon footprint of the organization. 

It varies from year to year, affected by uncertainty due to the metric calculation of the data, and by the approximations and assumptions made by the company which usually relies on an external consultancy company to be able to certify its carbon footprint. 

Eg. If a transportation company during the year 2019 had a value of Scope1 = 240 [tCO2e], Scope2 = 500 [tCO2e], Scope3 = 1000 [tCO2e] then their sum Scope1 + Scope2 + Scope3 = 240 + 500 + 1000 = 1,740 [tCO2e], represents the carbon footprint of the company in that particular year, which could be offset by acquiring 1,740 carbon credits, as one carbon credits is equivalent to one tonne of CO2.

It means offsetting the total emissions generated in the previous calendar year (Carbon Footprint) through Carbon Credits certified and recognized by the UNFCCC (United Nations Climate Change Framework Conventions). 

Usually, it is integrated into a multi-year emission reduction plan in order to compensate for all the unavoidable emissions of a particular company.

After identifying an area in a developing country that is compatible with all the requirements of the UNFCCC (United Nations For Climate Change Convention), the tree species are planted. After a period of three to four years, the new forest will undergo an initial validation process, which will take place in collaboration with the GOLD STANDARD or VERRA Standard and an audit firm (15 are accredited by the Standard). 

The PD (Project Document), the project document, will be prepared, together with a long series of documents that make up a real specific dossier, taking into consideration all the social and biodiversity aspects as well as all the risks related to the area and the project same. 

This dossier will be published and always visible on the GOld STANDARD or VERRA Standard register. During the validation process, an ex-ante estimate of the potential of the credits produced is made, once this first phase has been successfully passed, the verification proceeds, which consists in the exact count of the ex-post emissions. 

This will be followed by the site visit together with the auditor who will verify that what is stated in the project is compliant and truthful. 

The auditor also makes sure to interview the workers, the communities present and the stakeholders involved in the project. 

Once the verification process is complete, the Standard proceeds with assigning a certain number of carbon credits corresponding to the number of tons of CO2 equivalent seized during the period in question. 

The validation and verification process can vary from a minimum of 1 year up to several years depending on the complexity of the project or the difficulty of producing the documentation necessary for the Standard. 

The verification phase will be repeated approximately every 2-3 years, always following the audit process of the auditor and the Standard (in fact it is as if there was a double audit), thus assigning the corresponding number of credits. 

The duration of a forest reforestation project must have a minimum duration of 20 years, in order to ensure that the new carbon stock generated by the new trees planted remains for a long period. 

There is a special register, GOLD STANDARD or Verra Registry, which assigns a serial number to each credit issued and is traced in its transfer of ownership and up to the cd. "Withdrawal" that is its effective use on the market to offset 1 tonne of CO2 emitted. 

When the credit is "withdrawn", the Standard issues an official certificate, together with its unique codes, which certify its uniqueness and avoid double counting or double selling.

The Carbon Credits market is a freely competitive market on an exclusively voluntary basis. 

As such it obeys its rules. Each carbon credit is to be considered as an asset that can be purchased to offset CO2 emissions or to be resold or to be held and resold in the future or cancelled to compensate emissions.

First of all, the value depends on the type of credit purchased. 

For example, there are credits produced by renewable energy production projects (wind, hydroelectric, geothermal, biomass, etc.). 

These projects, characterized by a double entry (on the one hand the sale of green energy, on the other the sale of carbon credit) can produce carbon credits. In this case, the proposed price of the credit may be lower thanks to the double source of turnover capable of generating the project.

On the other hand, reforestation projects can only financially rely on the sale of credits and have enormous costs for the development and maintenance of the project. 

The intrinsic value contained in a reforestation credit, for example, is greater than all the others and the reason also lies in the positive externalities (also called positive incidental values) that are able to generate such as the restoration and increase of biodiversity from creation. of new habitats, the increase in the quality of life of local communities and the creation of qualified jobs, the generation of oxygen, the improvement of the microclimate of the region, etc. 

All these are elements that give reforestation credits a much higher value than those generated by other types of projects. 

Forest credits are therefore the most sought after on the market since they are also aligned with the Sustainable Development Goals (SDGs) envisaged by the United Nations 2030 Agenda for Sustainable Development.