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PRESS RELEASE: Respira announces intention to purchase up to 50,000 carbon removal credits from Capture6

By News

Press release: 29th November 2023

  • Expanding its global carbon removal and reduction initiatives, Respira adds the first direct air capture (DAC) project to its portfolio

 

LONDON, UK – 29 November – Respira, an impact-driven carbon finance business, has announced its intention to purchase up to 50,000 direct air capture (DAC) carbon credits from Capture6, a water-positive carbon removal company.

This will be Respira’s first investment in direct air capture technology and represents an expansion of its engineered carbon removals portfolio, following the signing of an MOU with BECCS (Bioenergy Carbon Capture & Storage) pioneer, Drax, as the business builds on its market leading nature-based portfolio. 

Ana Haurie, CEO of Respira commented: “The voluntary carbon market is going to be vital if we are to tackle the climate crisis and we must use all of the tools at our disposal. This new agreement enhances our portfolio of nature-based projects that are reducing carbon emissions today, with an exciting new technological solution that will be an important part of removing carbon from the atmosphere into the future.”  

This pre-purchase will support Capture6’s groundbreaking project in the United Arab Emirates, where world leaders will meet later this month for COP28 in Dubai. Capture6’s technology integrates direct air capture while generating freshwater and has the potential to eliminate the disposal of excess brine into the fragile marine environment.

Capture6’s technology can deliver significant additional decarbonization associated with green industrial chemical production. The processes can operate at ambient temperature, without any need for thermal energy, so the process can run on 100% renewable energy. This enables Capture6’s technology to yield high net negativity for carbon removal and drives scalability and cost efficiency. Given these synergies between desalination, carbon removal, and decarbonization, the UAE represents a unique opportunity for Capture6 to demonstrate the full potential of its technology in delivering impactful climate solutions to the world. 

The CEO of Capture6, Dr. Ethan Cohen-Cole, expressed his enthusiasm about this offtake agreement: “Our partnership with Respira marks a pivotal step in realizing our vision of scalable, sustainable solutions for carbon removal. Together, we are not only mitigating the impacts of climate change but also pioneering innovations that contribute to the long-term well-being of our planet.”

United Arab Emirates could remove ~158 million tons of atmospheric CO2 by incorporating Capture6’s technology into its existing desalination facilities. Capture6’s innovative process has the added advantage of increasing the freshwater production capacity of existing seawater desalination plants by up to 50%. This industry promises significant economic growth and the creation of tens of thousands of jobs in the country.

The pre-purchase of CDR credits by Respira shows clear support for Capture’s goal to decarbonize industries while at the same time reducing emissions and increasing freshwater supplies. Global temperatures have already risen 1.2°C from pre-industrial levels due to burning fossil fuels. According to the Paris Agreement, we need to keep global warming under 1.5°C to avert the most catastrophic impacts of climate change. Reaching that target is no longer possible by reducing emissions alone, a fact highlighted in the latest IPCC report. Permanent and irreversible carbon removal must be deployed at unprecedented speed and scale.

ENDS

 

About Respira

Respira International is an impact-driven carbon finance business. Respira operates with an innovative offtake and profit share model which reinvests back into project stakeholders.  Respira’s high-quality carbon credits allow corporations and financial institutions to mitigate their environmental impact. Respira channels private capital into climate solutions ensuring long-term relationships with trusted carbon project developers that enable its clients to to build sustainable, climate-positive businesses and portfolios. Respira’s team combines deep and varied experience working in global financial markets with a robust understanding of carbon project development in leading international conservation organisations.

For further information, please visit respira-international.com

About Capture6

Capture6 is a water-positive carbon removal company based in California and New Zealand leveraging its technology to support climate resilience and industrial decarbonization. The company develops and commercializes highly scalable approaches to remove carbon dioxide from the atmosphere. Capture6 is pioneering an approach that can be deployed today by repurposing existing industrial-scale technologies. Additionally, when coupled with desalination facilities, Capture6 can recover over 50% of freshwater from desalination waste brine for drinking and industrial purposes in the process of removing CO₂. This creates a meaningful synergy between carbon removal and water security. Learn more at capture6.org.

29 November 2023
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Removal in action: How Antti Vihavainen is growing the engineered carbon removal market

By News, Tech in Action

Antti Vihavainen is certain. He is sure that hope alone will not solve the climate crisis. For Antti, hope must always be accompanied by action if a true impact is to be made. It is on this firm belief that his company, Puro.earth, was founded in 2018. Ever since, Puro.earth has been actively expanding the tech-based carbon removals sector with a carbon crediting program dedicated to engineered carbon removal. 

Engineered carbon removal differs from nature-based carbon removal. Rather than investing in natural carbon sinks, such as forests and soil, engineered carbon removal uses technology to draw and store greenhouse gases from the atmosphere. Methods including carbon capture and storage (CCS) and direct air capture (DAC) store the emissions they remove securely, often in vast underground geologic formations. 

In the past five years, Puro.earth has validated the technological removal activities of more than 50 companies and facilitated the sale of verified credits to corporate stakeholders to support their decarbonisation strategies. Here, Antti shares his motivations and reveals how Puro.earth is scaling the engineered carbon removal market.

Can you introduce yourself and explain why you decided to found Puro.earth?

In 2017, it became apparent to me. I realised the concentration of atmospheric carbon dioxide (CO2) was already too high. Although I’ve always been interested in the climate, this was a pivotal moment for me. I realised that our emissions reduction efforts were simply not fast enough and that humanity faced an unprecedented, runaway climate catastrophe.

Yet, there was something else I recognised. While emissions soared, more and more research was being conducted into technological methods for removing carbon from the atmosphere. But something was missing – these engineered climate solutions were not being sufficiently commercialised. With the climate crisis at our door, I wanted to explore the commercialisation of tech-based carbon removal with the aim of facilitating the growth of new, net-negative carbon industries. So in 2018, I co-founded Puro.earth, the first carbon crediting program focused exclusively on technology-driven carbon removals.

Could you say more on the problem you seek to solve?

Puro.earth solves the very same issues that first drew me to the world of engineered carbon removal. With such extensive research into these technologies, I had identified a real need for commercialisation. So, first and foremost, Puro.earth is a platform dedicated to harmonising the climate effects of different carbon removal methods. In this way, Puro.earth assists in the overall scaling of engineered carbon removal. We want to help the removals market grow in efficiency and enable more companies to embark on a science-based pathway to reach a state of net-zero emissions. 

Since we launched, Puro.earth has pioneered several of the world’s first crediting methodologies for engineered carbon removal. While we bring together a range of removal activities, our criteria always remains the same. We look for methods which can be scientifically verified; that durably capture and store CO2 for 100+ years and which have the potential to scale industrially. We believe that in facilitating corporate engagement with engineered carbon removal, we can drive the development of a strong, carbon net-negative economy. It’s our aim to galvanise further investment in these technologies. 

Let’s get technical: How does your product work?

Our Puro.earth platform brings together suppliers of carbon net-negative technologies and climate-conscious companies. We have developed our own Puro Standard with which to verify CO2 Removal Certificates (CORCs). Each CORC represents one tonne of CO2 that has been removed from the atmosphere via an engineered method and stored long-term in carbon net-negative processes or products. 

We are particularly proud of our Puro Standard for it is the first to assess carbon credits generated exclusively from such tech-based removal activities. The methodologies of the Puro Standard are science-based and durable, meaning that companies can depend on them for precise emission compensation. To maintain independence, the Puro Standard is managed by an Advisory Board which oversees any proposed changes to its rules and requirements.

On our platform, buyers can browse the available tech-based carbon removal suppliers and explore purchase options. However, buyers do not purchase CORCs through Puro.earth. Instead they negotiate an agreement directly with an accredited CORC supplier or via our network of carbon marketplaces connected to our registry. CORCs can either be bought as a spot purchase or as an advance market commitment. In the latter, the buyer agrees to purchase CORCs that will be verified in the future. Known as Pre-CORCs, these are certificates that allow companies to pre-pay for validated projections of engineered CO2 removal. Only after such a carbon removal has been independently verified are Pre-CORCs converted into CORCs.

Can you share a story of success?

In the five years since our launch, we have grown to be the world’s leading crediting platform for engineered carbon removal. Now, more than 50 companies have issued CORCs and are selling them directly to corporations or via the carbon marketplaces connected to our registry. 

It is hard to choose just one story of success because throughout 2023 we have formed numerous partnerships and made agreements with other companies in the engineered removals space! In July, we announced our CORCs would be available on Xpansiv’s CBL Spot Exchange platform, while in September  we signed an agreement with the carbon capture company, Climeworks. Moreover, we are working to develop Africa’s first DAC facility with Octavia Carbon and Cella. We consider such collaborations to be essential in the expansion of the tech-based removals market.

And finally, what’s next for Puro.earth? 

There’s so much innovation happening within the climate space that we are constantly impressed with the suggestions we are given the opportunity to assess. Amid so much fast-paced transformation, we expect to jump one order of magnitude in the next 18 months and make a second leap by 2027.

 

Disclaimer: Respira International does not have any undisclosed affiliation with Puro.earth. Read more about Puro.earth here.

24 October 2023
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Respira founding member of Kita’s Carbon Supplier Pool as market develops

By News

We are pleased to announce that Respira is a founding member of Kita’s Carbon Supplier Pool. Taking a new, innovative approach, the carbon insurance specialist now offers clients of its Carbon Purchase Protection Cover the option to receive claims in carbon credits. We welcome such professionalism in the voluntary carbon market, viewing these developments as clear, positive markers of growth for the industry.

As a Lloyd’s of London coverholder, Kita’s Carbon Purchase Cover insures buyers of forward-purchased carbon credits against under-delivery. Kita’s new approach highlights its commitment to scaling the carbon markets and to supporting client’s high integrity net zero goals. 

Kita will work closely with lead capacity provider, Chaucer, to review and assess claims and offer replacement carbon credit payment. Cash payment for eligible claims will also remain an option. Any replacement carbon credits for eligible claims will be distributed from Kita’s proprietary Carbon Supplier Pool. Respira is proud to join Everland, Pachama and Vertree as the founding members of this pool.

Speaking on the new developments, Kita’s CEO and co-founder, Natalie Dorfman, said:

“Kita’s mission is to drive more financing to scale high-integrity carbon projects, and we believe insurance is a key enabler to do this. We are proud to be leading the field when it comes to paying claims in carbon, and look forward to working with, and expanding, our Carbon Supplier Pool as we move forward.”

Kita shares more in a press release here. Read more about Kita’s products here and more about Respira’s portfolio of carbon credits here.

12 October 2023
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How can the voluntary carbon market support Indigenous Peoples?

By News

Are you an urban person or a nature person? This binary distinction is one with which we readily self-categorise. While in reality it is unlikely any one of us is entirely one or the other, there is no denying that some of us live more deeply connected to the natural world than others. With each passing generation, globalisation has allowed city-dwellers of the Global North to grow increasingly detached from the land on which we all depend. However, for many of the world’s 476 million Indigenous Peoples, ancestral ties to the natural world remain strong. 

The best custodians of nature

While culturally and geographically disparate, Indigenous Peoples tend to have in common a close connection ‘to the land where they live or from where they have been displaced.’ As much as 22 percent of the earth’s land is traditional Indigenous territory including 11 percent of global forests are legally owned by Indigenous Peoples and local communities. In the Amazon, research shows deforestation rates within securely held Indigenous land is on average 50 percent lower than outside of these territories.

These areas are home to an abundance and a richness of species, making them extremely biodiverse. In fact, 80 percent of the planet’s remaining biodiversity can be found within Indigenous territories – a testament to the holistic, sustainable manner in which Indigenous communities live in tandem with the natural world. Indeed, with generations of knowledge, Indigenous Peoples the world over describe working with the land as opposed to on it. It therefore makes complete sense that those with grounded, intergenerational experience of an area are the best equipped to conserve it. 

A challenging landscape for Indigenous Peoples

While several studies report Indigenous Peoples to be the best custodians of nature, all too often these communities fail to receive the recognition, rights and representation they deserve. 

Lack of representation

Indigenous People continue to be unfairly underrepresented in international decision making. While the UNFCCC tallied more than 49,000 attendees at COP27, only around 250 Indigenous people were able to join the conference in person. The inaccessibility of climate decision making demands that greater effort be made to help Indigenous Peoples and local community members take their seats at the table.

Lack of formal land rights

Nearly one quarter of all land is Indigenous territory. However, a systemic lack of formal land rights threaten the security of many Indigenous Peoples. Without secure land rights, it is far harder for these communities to conserve nature and biodiversity as they have done for generations.

Undelivered pledges

At COP26 in Glasgow, a total of $1.7 billion was pledged to support Indigenous land rights. While this sounds positive, only 7 percent of this sum has so far been delivered. 

Misdirected funding

Supposedly $270 million of funding is allocated to Indigenous-led forest conservation every year. However, only a meagre 17 percent arrives in the hands of a named Indigenous-led organisation. 

The voluntary alternative

Amid such lack of delivery and serious under-representation, the voluntary carbon market can provide an alternative form of funding for Indigenous-led conservation. High quality carbon credits, generated from nature-based projects, can be sold to corporates seeking to voluntarily compensate for their hard-to-abate emissions. The proceeds of these sales must be shared equitably with the Indigenous and local communities working to conserve forests. Not only does this recognise and reward efforts, but can also fund further forest conservation activities.

The projects in our portfolio are high-integrity. We conduct our own due diligence to ensure positive impacts on communities is an integral part of the project design. Once we onboard a project to our portfolio, we use our balance sheet to support project developers through long-term offtake agreements. Consequently, they can concentrate on running their projects rather than fundraising and local people have a reliable and consistent source of revenue.

How does this work in practice?

Two of our flagship portfolio projects are developed by Carbon Tanzania. As a social enterprise, Carbon Tanzania counters the prevalent conservation notion that to protect ecosystems and biodiversity, humans must be excluded from the area. Instead, Carbon Tanzania helps Indigenous and local communities to protect nature and biodiversity under fair, equitable economic conditions.

In Tanzania, the Hadza, Datooga and Masaai people have, for generations, lived with the land. Yet, as more people move to Tanzania and demands on resources increase, many communities are finding their way of life to be threatened. Indeed, the territory of the Hadza, Datooga and Masaai is frequently used by migrant farmers. Informed by entirely different life experiences, new arrivals are likely to farm in a way entirely contradictory to that of the Indigenous communities to whom land belongs. 

In response, Carbon Tanzania recognises that strengthening land rights and resource tenure is vital. Ensuring that the Hadza, Datooga and Masaai retain rights to their ancestral land not only safeguards their way of life, but protects naturally forested areas from destruction. This conservation model provides a powerful template for attributing appropriate value to nature and ensuring those responsible for its stewardship are fairly compensated. 

What guidance is already in place for Indigenous Peoples?

Free, Prior and Informed Consent

UNDRIP’s framework on Free, Prior and Informed Consent should form the foundation of any carbon project working with Indigenous Peoples and members of local communities. Let’s look a little closer at what this means: 

Free 

Consent for a project’s operations must be offered voluntarily and ‘without coercion, intimidation or manipulation.’ When consent is sought, communities should also not be placed under stressful timelines that could force or rush their processes of decision making. 

Prior

Developers should seek consent prior to it becoming ‘necessary’ for a project’s operations. In the very beginning stages of a project, information should be given to local people and should take into account the time needed to understand and analyse potentially new ideas.

Informed

The project information provided to Indigenous and local people should be clear, accurate and entirely transparent. Moreover, information should not cease if and when consent is given. Instead, information should continue to pass between developers and locals throughout a project’s lifespan.

Consent

Consent should be discussed collectively among the holders of land rights and local stakeholders. Any decision to grant or withhold consent should be informed by a participatory process, not the will of a minority.

Embedding Indigenous Knowledge

In January, a new report from the World Economic Forum outlined ways in which Indigenous knowledge could be better included in carbon projects. It states, “‘Respecting Indigenous peoples’ cultural knowledge, rights and responsibilities will boost the resilience and long-term impact of landscape conservation and restoration projects.”

Before establishing a carbon project, the report recommends developers consider likely power imbalances between themselves and Indigenous Peoples. It also advises developers not to underestimate the challenges of trust building and to acknowledge they may carry a cultural load, informed by generations of potentially inequitable interactions. 

The report also advocates for greater Indigenous involvement and participation in leadership roles. This can include increasing understanding of unmet community needs, presenting a range of project options and, crucially, an equitably sharing project benefits.

Tropical Forest Credit Integrity Guide 

The Tropical Forest Credit Integrity (TFCI) Guide speaks extensively on the role of Indigenous Peoples as custodians of the world’s forests. It sets an expectation that the equitable inclusion of Indigenous Peoples should be considered a ‘hallmark’ of a high quality, forest conservation project. Rather than considering Indigenous communities members as beneficiaries of carbon finance, projects should form equal partnerships with interested local people. The Guide itself had input from Indigenous stakeholders. 

How could carbon projects be improved for Indigenous Peoples?

In Global North carbon market criticism, we have observed that many opponents neglect to seek the perspectives of the Indigenous people and local communities on the frontlines of climate change. Of course, opinions will not be homogenous – some people will always be in favour while others stand firmly against. However, there are many Indigenous Peoples who see great potential in carbon finance to support global conservation efforts.

At the beginning of May, more than forty Indigenous-led groups and organisations published an open letter asking the global finance and climate communities to support forest protection, or REDD+, carbon credits. The letter highlights the ways in which REDD+ can provide financial resources and help to safeguard ancestral lands. At Respira, we stand alongside the Indigenous-led groups and organisations calling for immediate support to ensure continued funding to the Global South via REDD+ carbon credits. 

As global temperatures continue to rise and deforestation continues to hit record highs, we must listen to and champion Indigenous voices. We are calling for Indigenous voices to finally be uplifted in conversations about climate finance and for private capital to be channelled, at scale, to Indigenous-led forest conservation efforts.

1 August 2023
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ICROA

Why we must invest in soil carbon storage

By News

It may sound far-fetched, but it’s true – the top thirty centimetres of the earth’s soil contains almost twice the volume of carbon as in our atmosphere. But while we increasingly acknowledge the role of the oceans and trees for carbon storage, we often forget the huge potential of the ground beneath our feet. 

To address this lapse of attention and raise awareness of the power of the soil, we will answer the following questions:

  • How does soil carbon storage work?
  • Why do we need healthy soils?
  • What prevents effective soil carbon storage?
  • How can we farm for soil health?
  • How do our flagship portfolio projects work to improve soil health?

How does soil carbon storage work?

The world’s soils are inherently carbon-rich. On a basic level, as plants photosynthesise, they capture carbon which is, as they die and decompose, stored in the soil. However, human activity can also seriously alter the soil’s carbon content. 

On the one hand, we can increase the ability of soils to capture carbon by planting crops. As they grow, these plants capture – or sequester – carbon dioxide from the atmosphere. This is transported through their intricate root systems and stored below the earth’s surface. But our growing needs for land and food are placing additional, excess pressure upon the earth. As forests are cleared and we turn to increasingly intensive agricultural practices, we prevent the soil from storing carbon at scale. With the climate crisis already at our door, destroying a natural method of carbon capture is extremely serious – we have no time to delay, we must invest to improve the health of the world’s soils. 

Why do we need healthy soils?

Our soils are absolutely foundational to support life on earth. When soils are healthy, they contain the correct mix of nutrients and microbiology to support a region’s native plants. This, in turn, supports an area’s overall biodiversity as mammals, birds and insects can consume the nutrients they need. What’s more, soil can hold more water when it is healthy and uncompacted. This can improve water retention, serving to reduce risks of flooding.

But this is not all; when soil is in a state of good health, it offers extensive benefits for our climate. Globally, our soils could sequester and store carbon at such a scale as to be transformational to climate mitigation efforts.

There is an increasing scientific consensus that farming can play a pivotal role in soil carbon storage. For instance, Jacqueline McGlade – former chief scientist at the UN environment programme – estimates that improving agricultural practices can boost soil carbon storage. The study finds that enhancing the farming techniques on half of the world’s agricultural land so as to store just one percent more carbon, would be enough to create substantial change. 

McGlade is not alone. Another study reports that if soil protection and restoration efforts were improved to the maximum, an additional 5.5 gigatonnes of CO2e could be sequestered and stored every year. However, other sources offer different estimates. Indeed, the NCS World Atlas – a tool developed by Nature4Climate and The Nature Conservancy to convey the potential of natural climate solutions for emissions reductions – considers 1-2 billion tonnes annually to be achievable. Although a smaller volume, the NCS World Atlas estimate is still a material amount – roughly equivalent to the entire annual emissions of Russia in 2020.

What prevents effective soil carbon storage?

The climate crisis poses a serious threat to soils. As temperatures rise and rainfall patterns change, soils can become dry, dusty and more likely to blow away. Not only does this limit the soil’s ability to capture and store carbon, it also reduces agricultural output. Without moisture, yields are lower, and more irrigation is required to keep farms productive. With the global population already exceeding 8 billion, maintaining (and increasing) the capacity of soil to produce food is critical for future food security.

 With so many mouths to feed, it is understandable that much of the world has turned to intensive agriculture over the past decades. In the agricultural sector, many farmers remain financially (and culturally) tied to nitrogen fertilisers, the extensive application of pesticides and using land, seemingly ceaselessly, for production. But the over-cropping and overgrazing of farmland has caused nutrient depletion and soil degradation. Therefore, in a collective bid to increase agricultural productivity, we have actually further limited our ability to produce food in the long-term. 

On a local scale, effective soil carbon storage can be prevented if farms operate from a place of financial insecurity. Without stable, steady incomes, transitioning to more sustainable agricultural practices can be unfeasible. However, financial incentive mechanisms could help farmers focus upon the health of their soils and shift to a more regenerative way of farming. 

How can we farm for soil health?

Despite the increasing body of scientific evidence on soil carbon storage, strategies to improve soil health are not widely deployed. But, this can be short-sighted; many of the methods used to boost soil carbon storage – such as regenerative agriculture – also improve yields and long-term soil fertility. 

Regenerative agriculture is a way of farming with nature, leveraging natural processes to safeguard soil health. For example, rather than relying on ploughing to aerate the soil, in regenerative farming, a thriving worm population fulfils this role. Pesticides and nitrogen fertilisers are exchanged for crop rotation, cover crops and the integrated grazing of livestock. This means that the same fields are not used repeatedly for a single species and that additional crops are planted between harvests. Therefore, carbon can be continually drawn from the atmosphere and into the otherwise barren soil and more nitrogen can be ‘fixed’ in the soil. As a result, farmers have less need for synthetic fertilisers. 

But, if faced with financial insecurity, how can farmers implement these changes? Fortunately, we are increasingly equipped with financial incentive mechanisms to offer support. Indeed, carbon finance payments can act as a bridge, helping farmers to incorporate regenerative approaches. Although generating carbon finance from soil organic carbon (SOC) requires accurate measurements, emerging Measurement, Reporting, and Verification (MRV) technologies offer great potential. MRV tools can be used for both direct measurement – such as soil sampling – and remote sensing.

Our commitment to soil carbon storage

At Respira, we recognise the power of healthy soil for climate mitigation and have been early supporters of two innovative soil carbon storage projects: one focused on grassland management and the other on regenerative, arable farming.  

First we partnered with the world’s largest soil carbon storage project – Northern Kenya Rangelands – which is restoring two million hectares of community-managed, grassland habitat. It is working to establish rotational grazing plans to limit the impacts of overgrazing, improve soil health and, as a result, sequester more carbon from the atmosphere.

Just last year, we welcomed a second soil carbon storage project to our portfolio. Established in 2020, Blaston Regenerative Farming Project is working to improve soil health across 230 hectares of Leicestershire farmland. Supported by independent agronomists, Indigro Ltd, Blaston Farm uses regenerative agricultural methods such as the direct drilling of arable land, crop rotation, the use of cover crops, and integrated livestock grazing. Not only do these methods enable the soil to store more carbon – but they also boost the farms overall biodiversity, long term productively and ultimately profitability. 

Based on the additional carbon stored in Blaston’s soils, the project generates soil carbon certificates which represent the net amount of carbon sequestered on the farm after deducting all emissions associated with the farm’s activities. The sale of these certificates is now the second largest source of income for Blaston Farm, providing an alternative to EU subsidies in a post-Brexit Britain. In this way, regenerative agriculture is an opportunity to promote environmental and financial sustainability. While producing nutritious food, a farm can take climate action via the direct sequestration of carbon from the atmosphere. 

Such projects prove that agriculture can be a solution to – not a driver of – climate change. We remain extremely committed to soil carbon storage and are optimistic of the climate mitigation potential these projects provide. With more soil carbon storage projects in the pipeline, we invite you to watch this space for announcements.

20 July 2023
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Retired carbon credits explained

By News

When we hear the word ‘retirement’, most might imagine a pension, large quantities of free time and perhaps a new-found love of gardening. Given these connotations, it is perhaps unsurprising that used in the context of the voluntary carbon market, the concept of retirement can create confusion.

In the carbon markets, retirement has a different meaning. In its essence, a retired carbon credit means its buyer has ‘redeemed’ the one tonne of carbon reduction it represents and claimed it against their own emissions which they have not yet been able to cut. 

When a buyer retires a credit they have purchased, the credit is removed from the market. This means no one else is able to counterbalance their emissions based on the carbon reduction the credit represents. 

To put this in context, 196 million carbon credits were retired overall in 2022. If these retirements had been evenly distributed throughout the year, more than 500,000 credits would have been retired every, single day. Although this represents a 1.3 percent decline on the previous year, the most recent market sentiment survey from the IETA found optimism among its respondents. Based on the responses from market participants the survey predicts that the market will soon return to a positive upward trajectory.

Wait, how are credits generated?

To truly understand the concept of a retired carbon credit, let us first refresh ourselves on the basics of credits.

What? A carbon credit represents one tonne of carbon dioxide or an equivalent volume of another greenhouse gas (CO2e) that has been either removed from, or prevented from entering, the atmosphere. 

However, historically not all credits have been created equally. Learn more about the criteria for a ‘good’ credit with this article from our archives.

How? A credit can be generated from nature-based projects, technological climate solutions or even renewable energy generation. The volume of CO2e avoided or removed from the atmosphere is calculated and a corresponding number of carbon credits is conservatively calculated. 

The calculation process involves following established methodologies, baseline allocation and verification. Find out more about this process here.

Why? Carbon credits are sold to individuals and businesses to support their decarbonisation strategies. The carbon finance generated from these sales funds further climate mitigation activities and can even support the delivery of impactful, non-carbon benefits for people and nature.

For an example of carbon credits in action, please see this case study of the Gola Rainforest Conservation Project. And to learn more about the responsible purchase of credits, see this flyer on the mitigation hierarchy.

But why do you need to retire credits at all?

In this section we will cover why carbon credits need to be retired, including:

  • Confirming impact
  • Claims
  • Double-counting

When a buyer purchases carbon credits in line with the mitigation hierarchy, the positive benefits of those credits are not automatically attributed to that individual or company. Rather, the buyer ‘holds’ these credits until they wish to retire them. However, once a retirement has been executed, the buyer is free to claim the positive impacts the credits represent. This effectively ends the credit’s ‘life’ for it cannot be reused or reclaimed.

In this way, retirement stops the benefits of credit from being claimed multiple times. In the industry, this is known as preventing double-counting. Only the stakeholder who retires the credit can claim the emission reduction it represents towards its climate targets and they can only do so once. Retirement is extremely important for driving credibility and traceability when using carbon credits to achieve net zero.

What’s the process for retired carbon credits?

Before a carbon project can issue credits, it will complete a process of verification which happens within a framework set up by a programme, such as VCS by Verra or Gold Standard. Only after verification are credits issued in a dedicated registry. Credits are always marked with a unique serial number which allows them to be tracked and accounted for.

Carbon credits can be owned by a number of market participants – the project developer, financing institution, intermediary or a company wishing to use them to counterbalance their own emissions. They can be traded, sometimes several times, among the market participants. This means that carbon credits can exist, unretired, for some time. However, at the point of retirement carbon credits are permanently removed from circulation and cannot be resold. This prevents any double-counting of emission reductions. Information on historic retirements is stored in publicly accessible emission registries, driving transparency for the market.

The future of retired carbon credits

As technology advances, stakeholders across the voluntary carbon market are working to better the carbon markets including the retirement process itself. Blockchain, Tokenization and Distributed Ledger Technology (DLT) all hold great potential for scaling of the voluntary carbon markets. These technologies can boost the overall transparency of credit retirements and support the overall integrity of the markets. We look forward to engaging with new innovations as the world of credit retirements develops and interacts with these emerging technologies.

5 July 2023
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Carbon Credits

“We are not a broker, we’re a carbon finance company”

By News

Traditionally, carbon credits have been bought and sold by brokers on a spot basis, but at Respira, we operate differently, and have helped to shift towards a carbon finance model of carbon credit trading. We recognise that the broker approach creates little long-term certainty for carbon communities, and, at times, even curtails the development of high-quality projects. This is why we offer an alternative – a model prioritising the overall stability of our flagship portfolio projects. 

Respira is not a broker. Rather, we are a source of non-dilutive private capital. We offer revenue certainty for project developers through a guaranteed floor price for carbon credits and use our balance sheet to support them with long-term offtake agreements. Not only does this enable project developers to expand with confidence, but also creates greater certainty for our buyers who can lock-in future prices. 

 

The Respira model

The Respira ethos 

Respira International was co-founded by Ana Haurie and Robin Bowie in 2019. They saw the urgency with which we must address the climate crisis and recognised the role the private sector must play in these efforts. To drive the necessary levels of corporate action, the voluntary carbon market offered great potential. Speaking of the role of high-quality carbon credits in mitigation, Robin said:

“Buying voluntary carbon credits provides an engaging and impactful way for companies to compensate for residual emissions whilst on the pathway to reducing internal emissions. It enables corporations to go beyond what they are mandated to do through regulation.”

He continues:

“Through integrated plans which combine value chain emissions reductions with appropriate use of carbon credits, corporations can set a powerful and engaging example for others to follow.”

Now, four years later, Respira International continues to expand. Our diverse team combines a 30+ year track record in global financial markets with a deep understanding of carbon project development in leading international conservation organisations. 

Reflecting on the Respira team, Chris Villiers, Director of Portfolio Management, said:

“Respira has brought together a team with the network and experience to develop products in the voluntary carbon market that can attract institutional capital at scale that will be used towards reducing emissions globally and deliver significant climate impact.”

The time is now

Our team knows we cannot delay climate action. In the next seven years, we must significantly decarbonise our economies if we are to meet the targets set by the Paris Agreement. Eva Weightman, Director of Corporate Client Relations, said: 

“With 2030 fast approaching, there is no time to sit idle. The world needs business leaders to act with urgency and curb their companies’ emissions if we are to limit global temperature increase to 1.5°C above pre industrial levels. ”

Chief Technology Officer, Jon Mulder agrees:

“The time to act on decarbonisation and nature restoration has never been more critical. The solutions exist today and must be scaled and deployed more rapidly. We all have a role to play and carbon credits provide a vital service in protecting and restoring nature.”

If we are to achieve our 2030 ambitions, Finance Director, Peter Christie, argues that businesses must take voluntary action on climate mitigation.

“In the absence of direct regulation by governments, companies need to voluntarily ramp up their decarbonisation efforts so we can collectively solve the climate crisis. Carbon credits are an essential part of the business toolkit.”

Respira is committed to nature

However, carbon credits are not uniform in the benefits they deliver. Credits can be generated from activities which remove carbon from the atmosphere or from projects that prevent additional carbon emissions from release. But regardless of whether a project focuses on removal or avoidance, they can deliver a great many benefits for people and nature. It is with these projects – those with measurable impacts, aligned with the UN Sustainable Development Goals – that Respira partners.

This is why our flagship portfolio focuses predominantly upon nature-based projects such as forest conservation or mangrove restoration. Director Natural Climate Solutions, Ed Hewitt, further explains Respira’s investment rationale.

“There is a critical need to attach a monetary value to services that nature provides such as carbon capture, water quality, clean air and biodiversity.”

Ed continues:

“Carbon is really the first to be monetised at scale. By doing this we can financially incentivise the conservation and restoration of forests, soils and wetlands, helping us address the twin challenges of climate change and nature loss.”

Josh Schaefer, our Portfolio Director, explains that climate change and nature loss are inseparable challenges.

“Global emissions reductions can’t be achieved without tackling nature loss, because the earth’s natural ecosystems absorb roughly half of man-made carbon emissions – as well as providing numerous other benefits for people and biodiversity. Verified carbon credits have proved to be an effective way to finance the protection of natural ecosystems.”

Our CEO, Ana Haurie, concludes with a call to action:

“The time for the financial sector to act on climate is now. The predicted growth of the voluntary carbon market, with an increasing focus on nature-based solutions, provides a unique opportunity for institutional investors to benefit from this new asset class, while also supporting sustainable development goals and making a positive impact,” she said.

We encourage you to view our introductory video to learn more of our non-broker approach. And if you would like to find out more about our team, you can read more here.

27 June 2023
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Leakage: What does it mean for carbon credits?

By News

When a government declares one forest protected, who’s to say it won’t grant a logging concession for another? If a forest can no longer be cleared for subsistence agriculture, then where do these family farmers go? If carbon project developers are not careful, the answer can simply be: to the forest ‘next door’.

In the voluntary carbon market, this is known as leakage – a situation in which deforestation activities are not prevented, merely shifted from one area to another. It is a conundrum with which the market has grappled for years. Yet, despite making progress on leakage limitation, the ways in which project developers tackle the issue are not generally well understood. Cue this explainer.

What is REDD+?

But first, we must lay the foundations. Without a solid understanding of REDD+, you will likely be lost when it comes to the matter of leakage. Broadly, REDD+ refers to forest conservation activities but it also has a more specific meaning. According to UNFCCC, REDD+ activities work to “reduce greenhouse gas emissions from deforestation and degradation while promoting the sustainable management of forests and the conservation and enhancement of forest carbon stocks.”

REDD+ can occur at different scales. There is project level – usually tens to hundreds of thousands of hectares and normally run by NGOs or social enterprises – and there is the jurisdictional level – typically millions of hectares and can be run by a project developer under national or subnational frameworks. For every type of REDD+ project, it must ensure local people have the chance to give their free, prior informed consent to its activities and that is before it is verified by the industry’s standards bodies.

Whatever the scale, REDD+ can address different types of deforestation and degradation. There is avoided planned deforestation and avoided unplanned deforestation. Unplanned deforestation is inherently local, driven mainly by subsistence agriculture whereas planned deforestation usually takes place under government approved logging or agricultural development concessions. However, concessions need not always be destructive – they can be granted for conservation activities too.

When does leakage occur?

The risk of leakage presents differently depending on the project type. In avoided unplanned deforestation projects, leakage occurs when subsistence farmers stop clearing trees inside the conservation area but instead cut the trees outside of it.

In avoided planned deforestation projects, leakage can occur if the government hands out a concession for an NGO or social enterprise to conserve one area of forest while simultaneously granting a different concession to a company to log another. However, if a project operates on a jurisdictional level, the risk is that the deforestation or degradation activities are shifted to the neighbouring jurisdiction.

But whatever the project type, when leakage does occur, it underlines the level of pressure facing forests. If there is leakage, there is clearly a need for more conservation activities in an area. 

What can be done to address leakage?

There is a misconception in carbon markets that leakage from REDD+ projects continues unaddressed. Yet this perception is outdated –  leakage limitation has always been considered and incorporated into a project’s design. 

Whether it operates at a project level or a jurisdictional level, developers assess leakage risk as part of their verification processes and to monitor deforestation in its ‘leakage belt’ – an area outside of the project’s own conservation remit. Based on these calculations, it is standard practice for a project to set aside between 10 and 20 percent of the credits it produces as insurance against forest damage or leakage. This is known as a buffer pool.

What’s more, project’s often work to tackle the underlying drivers of deforestation and degradation in the surrounding landscape. In avoided, unplanned REDD+ projects, leakage can be addressed by offering alternative income streams to subsistence farmers and educating local people on agricultural practices.

It can also be tackled through the sustainable intensification of agriculture. While this might sound like an oxymoron, it is actually a clever conservation strategy. It shifts agricultural expansion away from standing forests and towards marginal lands or to areas historically cleared.

On the other hand, addressing leakage from planned deforestation usually requires government cooperation. If logging is identified as a major cause of emissions, market leakage is one way to reduce risk. Developers would use a national timber extraction figure and calculate the percentage of forest potentially lost to logging across the project area.

Indeed, if deforestation reduction targets are set at a jurisdictional level, it can incentivise conservation across the whole country for governments, bound by national commitments, are less likely to offer conservation concessions in one area and logging concessions in another.

At the same time, it must be acknowledged that coordinating all the political, economic and social actors in a jurisdictional REDD+ project can be a challenge. This role sometimes falls to NGOs, but there is a case to be made that this should be a government’s own responsibility. 

Regardless of whether a project works to prevent planned or unplanned deforestation, if leakage persists the developers will take precautionary action. They will reduce the overall number of credits issued by the project to prevent instances of over-crediting. 

Case study: Leakage limitation success

Makame Savannah, a project developed by Carbon Tanzania, has been successfully working to address the drivers of unplanned deforestation around its expansive conservation area. Spanning more than 360,000 hectares, this Wildlife Management Area has become a safespace for trees and wildlife. Indeed, since the project began in 2016, more than one million trees that would otherwise have been cut continue to stand. Based on Makame’s conservation work, 517,000 carbon credits have been verified and issued, including 330,00 to Respira.

Carbon Tanzania has woven leakage accounting into the very fabric of Makame Savannah’s project design. Taking a conservative approach to calculating leakage and issuing credits, 28 percent are not sold on the market, withheld instead as a buffer. At the same time, Carbon Tanzania operates proactively, engaging in specific leakage mitigation activities to reduce overall risk. 

What’s more, Carbon Tanzania works directly with local communities to address the underlying drivers of deforestation. The foundation of this approach is to reduce the daily cost of living to individuals and therefore reducing the financial necessity to fell trees for short-term economic gains.

Therefore, Carbon Tanzania ensures that revenues from these credit sales are distributed to members of the local community. So far these funds have been predominantly allocated to education and healthcare. Children have benefitted from scholarships, which has simultaneously lifted financial pressure from their families. Many individuals have received health insurance cards which, funded by the project, allow them to be treated in local hospitals for free. And in October 2022, more than 60 students had their university fees entirely covered by carbon revenue. 

Makame Savannah also employs local people for surveillance. Together, the team monitors the area for signs of poaching and agricultural expansion, catching some of the underlying activities driving deforestation early on. These holistic approaches adopted by Makame Savannah work to reduce leakage around the project area and clearly demonstrate how leakage can be minimised if effectively factored into a project’s design.

Projects like Makame Savannah give us confidence that the risk of leakage is taken seriously by project developers. However, while efforts are made to tackle the underlying drivers of unplanned deforestation and degradation, we also understand that occasionally leakage can still occur. Standard practice in the market provides assurance. In the event of leakage does occur, less credits are issued and a projects insurance buffer pool prevents any over-crediting from taking place.

 

 

 

12 June 2023
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World Environment Day: We need to invest in nature for climate action

By News

As an impact-driven carbon finance company, we channel capital to predominantly nature-based climate solutions while simultaneously supporting corporates to achieve ambitious climate targets. Given our mission, you could almost declare each day in the Respira office an environment day – we are constantly working to deliver positive impacts for both people and the planet. But today is particularly special: it is the 50th celebration of World Environment Day. 

Organised by the United Nations Environment Programme, this day is each year hosted by a different country and in 2023, it is the turn of the Côte D’Ivoire. It is a chance for people around the world to step up their environmental action; reassess measures taken and galvanise new levels of support. This year, World Environment Day is focusing attention on the global challenge of plastic pollution in recognition of the urgency with which we must change our attitudes to single-use materials. Indeed, more than 400 million tonnes of plastic is made new every year, only half of which is intended to be used more than once. With a concerningly low proportion of this recycled (less than 10 percent), it is hardly surprising that around 20 million additional tonnes of plastic pollute our rivers, lakes and seas annually.

For climate action, with need nature

The challenge of plastic pollution does not exist in isolation. If our global ecosystems are degraded, destroyed and polluted, we cannot successfully mitigate against climate change. Yet, caring for our natural world requires substantial funding and policy development. As well as legislation reducing the ease with which we can produce, use and dispose of plastic, we must also think ‘big picture’ and protect our natural world using conservation and restoration projects. 

Nature-based climate solutions are one way in which we can deliver the finance needed to create protected zones. These solutions involve working with natural ecosystems – such as forests or oceans – to address global challenges. This could be a mangrove restoration project or a scheme to conserve an area of tropical forest. It has been estimated that if nature-based solutions are effectively deployed, it could be possible to reduce and remove at least 5 – and potentially 11.7 – gigatons of CO2e from the atmosphere every year. 

At Respira, we understand that to hold open the rapidly closing door to 1.5°C, we must tap into nature’s potential. We recognise that protecting our natural world is absolutely foundational to solving the global climate crisis. However, we are also acutely aware that current levels of funding to nature-based projects is simply not adequate to incentivise conservation and restoration on the scale required for mitigation. At present $2-3 billion is delivered each year. While this may sound substantial, we need at least $130 billion per annum if we are to meet our climate targets.

Therefore, on this World Environment Day, we echo the UN in its call to action. Today, we would like to remind business leaders, corporates and the general public that investing in nature is not simply the right thing to do, but is, in fact, essential for safeguarding our collective futures. To help deliver the finance needed, we are 100 percent committed to helping the voluntary carbon market scale with integrity, transparency and speed. 

5 June 2023
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When are carbon credits most effective?

By News

It is often said that a bad workman blames their tools. As with many old proverbs, this saying does contain a morsel of truth, especially when applied to the voluntary carbon market. 

Recently, we have seen more cases of criticism directed at carbon credits and those who use them. But this is not always justified; it is not the credits themselves which are to blame. They are simply a mechanism which – when used wisely – can drive action for climate and nature. 

So while critics are busy accusing companies of using carbon credits to avoid meaningfully reducing emissions, a study has been quietly investigating the reality of this claim. Its findings revealed this statement to be far from the truth – it reported a positive correlation between an investment in carbon credits and the speed with which a company decarbonises.

So if it’s not the carbon credits themselves, then what can go wrong? Issues can arise during both the supply and the demand stages, so it’s important to understand what constitutes best practice. Choosing the best solution is challenging, particularly if you are new to the market, so here we outline the key traits which define high quality supply of, and high integrity demand for carbon credits. 

High-quality supply

In many ways, the success of including carbon credits within a corporate net zero strategy is determined long before a company decides to counterbalance their emissions. Ultimately, success is reliant upon the original quality of the credit supply which places a lot of responsibility on the shoulders of carbon project developers.

Firstly, developers must ensure that their project – be it forest conservation or mangrove restoration – would not have been possible without carbon finance. Only if credits are generated from an activity that would not otherwise be possible, can a project be classed as ‘additional’. When searching for high quality, it is essential that buyers check if a project’s additionality is verified.

Project developers should also take every precaution to ensure the benefits of their project are long-lasting. This applies, not just to its potential for climate mitigation, but also to any beyond-carbon benefits it offers to local people and the surrounding biodiversity. If a project’s impacts are short lived, it is not possible to consider its credits high quality.

The good news is that the voluntary carbon market is increasingly regulated. Buyers should always look to see if carbon credits are verified before they purchase. This means that any advertised emissions reductions have been measured and accounted for by an independent third-party agency. This includes analysis of the scientific methodologies used to calculate project baselines and regular surveillance of project areas. Emerging ‘nature tech’ is already paving the way for increasingly reliable verification across the carbon markets. 

There is also increasing guidance available to help buyers understand the characteristics of high quality carbon credits. For example, earlier this year, the IC-VCM released the much-anticipated Core Carbon Principles to set a minimum criteria for high quality carbon credits. This will help corporates to evaluate credits prior to purchase and ensure that they are engaging with climate solutions which bring genuine, long-lasting benefits.

 

High-integrity demand

However high the supply-side quality, credits cannot drive meaningful climate action unless the demand side operates with integrity. Corporates are encouraged to follow the mitigation hierarchy when considering using carbon credits to support their environmental action. This model advises that carbon credits are purchased only after every effort has been made to cut emissions from across the company’s value chain.

 

A diagram of the mitigation hierarchy which shows carbon credits as the fifth and final measure companies should consider in their net zero strategies. First they should avoid, minimise, rectify and reduce.

Recent years have seen growth, both due to mandatory disclosure and reporting initiatives such as the TCFD, and from the voluntary carbon market. More than 3,000 corporations have so far set net zero targets and are increasingly motivated to demonstrate their climate credentials to end consumers. This means many more are opting to voluntarily purchase credits to counterbalance their residual emissions in the near to medium term.

As more corporates are turning to carbon credits, organisations such as the VCMI focuses on regulating the environmental claims which can be made following purchase. Its work on the Provisional Claims Code of Practice is designed to address allegations of greenwashing and to ensure any claims made are entirely science-based and credible. 

Speaking of the growing body of regulation and guidance, our Director of Business Development Will Close-Brooks said: 

“If we take all of these together, we see an increasingly robust foundation from which the market can grow with integrity over the coming years.”

Indeed, operating under these guidelines, carbon credits are truly a mechanism to celebrate. Sourced from high quality projects and implemented with integrity, they hold enormous potential to drive climate action.

 

For more information on what makes a good carbon credit, please consider our previous article here.

9 May 2023
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