US VCM principles a strong statement of support – IETA

GENEVA – May 28 – The US government’s announcement today of a set of Principles for Responsible Participation in Voluntary Carbon Markets (VCM) is a very welcome development, and one which IETA wholeheartedly supports.

Presented by the U.S. Secretaries of Treasury, Agriculture and Energy and President Biden’s Special Envoy for Climate, Climate Envoy, the principles and the accompanying statements explicitly recognise the vital role that voluntary carbon markets can play in driving climate ambition. The principles provide a significant boost to the credibility of a carefully designed VCM.

“This is the first time the Biden-Harris Administration has spoken so positively about the critical role of the voluntary carbon markets,” said Dirk Forrister, CEO of IETA. “It’s positive, it’s a strong signal – and it comes at a critical moment when corporates are ready to scale up their climate action and market engagement.”

“We are delighted to welcome such a supportive approach from across the entirety of the US government,” Forrister added.

The government laid out seven key principles that should guide the development of VCM and companies that participate:

  • Carbon credits and the activities that generate them should meet credible atmospheric integrity standards and represent real decarbonization;
  • Credit-generating activities should avoid environmental and
    social harm and should, where applicable, support co-benefits and transparent and inclusive benefits-sharing;
  • Corporate buyers that use credits should prioritise measurable emissions reductions within their own value chains;
  • Credit users should publicly disclose the nature of purchased and retired credits;
  • Public claims by credit users should accurately reflect the climate impact of retired credits and should only rely on credits that meet high integrity standards;
  • Market participants should contribute to efforts that improve market integrity; and
  • Policymakers and market participants should facilitate efficient market participation and seek to lower transaction costs.

The US government has shown unequivocal support for the voluntary carbon market that industry has been striving for including robust guidelines for the use of credits with high integrity.

“These principles closely complement IETA’s own Guidelines for High Integrity Use of Carbon Credits, published earlier this year. They recognise explicitly that carbon credits can help towards meeting corporate emissions targets,” said Andrea Abrahams, managing director, VCM at IETA.

“The emphasis on liquidity and transparency also recognises the need for greater depth to these markets,” said Abrahams.