Trove Research: Do you know the types of projects that could issue carbon credits ?

Trove Research updated its Carbon Industry Classification (TR CIC), that provides a complete picture of the entire voluntary carbon market by classifying circa 4,000 registered projects and 2,500 pipeline projects across the major crediting registries, such as Verra, Gold Standard, CAR and ACR.

"These range from reforestation in Uruguay, to distributing cookstoves in Malawi to building a wind farm in Turkey." Buyers of carbon credits also have differing needs. For example, support natural ecosystems, or actually removing of CO₂ from the atmosphere, or monitor prices for indexes and trades.

According to Trove, in terms of the number of projects that generate credits, the situation is as follows:

• 31% Renewable energy

• 31% Energy efficiency

• 18% Non-CO2 gases

• 16% Nature-based, i.e.REDD+ and restoration

• 4% Fuel Swith and emerging removal technologies (Carbon Engineering)

In terms of volumes of CO2, the picture is different:

• 43% Nature-based

• 32% Renewable energy

• 8% Energy efficiency

That is, on average a nature-based project involves 1.575 million tons (Mt) of CO2, while a renewable energy project about 0.250 Mt of CO2 and an energy efficiency project 0.066 Mt of CO2.

Trove's article concludes: "When looking at just the four major crediting registries (Verra, Gold Standard, CAR and ACR) very few projects are focused on emerging removal technologies – only 14 of the 6,500 registered and pipeline projects. Currently most of these project types are held on other smaller registries. For example, PuroEarth, has 37 Carbon Engineering projects, of which 24 are Biochar. Given the high expectations for these newer removal technologies (and the reliance various bodies such as SBTi place on them in corporate net zero strategies) we expect these numbers will increase."

Trove Research builds on 30 years’ experience across financial services and carbon markets. In 2021 launched an intelligence subscription platform including details of companies that have set climate targets, price evolution and types of carbon credits, integrity and reputational issues, policies and guidance.

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