Forestry Sector Gains Momentum in Voluntary Carbon Market
Last week the first forestry investment was issued credits and in return, voluntary carbon market players could increase demand for carbon credits from the forestry sector.
Forestry credits have been eagerly anticipated within the market sector for a long period of time, so this will be a welcomed piece of news
The voluntary carbon market has been waiting for the news as players are prepared for participation in a multi-billion U.N. deforestation emissions reduction mechanism.
A Tanzanian reforestation project became the first forestry investment to earn carbon offsets under the Voluntary Carbon Standard (VCS). This assures investors that emission cuts are credible and long-term. Last week the first batch of credits have been issued and placed in the VCS registry.
According to scientists, one key way to fight climate change is to curb deforestation, as forests are able to soak up large amounts of carbon dioxide.
The scheme Reducing Emissions from Deforestation and Degradation (REDD), which is backed by the United Nations is not yet formally part of the broader U.N. climate deal. Although buyers of carbon credits are still investing in the sector as REDD is expected to be highly lucrative in the future.
The Climate Action Registry has been doing forestry for a while but the recent VCS news is far bigger, potentially injecting force to the growing support for a CDM (Clean Development Mechanism) and REDD’s plans to be verified.
The carbon offset organisation International Carbon Reduction and Offset Alliance (ICROA) mentioned that the voluntary market has helped bring forestry offset projects into the mainstream and could in effect potentially shape REDD’s future structure.
Back in 2009, both forestation and reforestation were among the top three most popular project types within the market. In separate developments by the American Carbon Registry approved the methodology this week, which was developed by Finite Carbon where owners of private industrial timberlands are enabled to earn credits for sequestering carbon better.