Voluntary carbon credits market 2023: global challenges and more local regulations

In an article dated March 1, 2023, the law firm Andersen Ballão analyzes the current situation of the carbon credit market in Brazil: in the process of regulation!

• PL 528/21 in the Chamber of Deputies, which aims to structure the regulated market and the voluntary market (VCM)

• Decree No. 11,075/22 which established procedures for the preparation of Sectoral Plans for Mitigating Climate Change and instituted the National System for Reducing Greenhouse Gas Emissions

• BNDES Carbon Credits Program, launched in November 2022, stimulating projects that generate credits

And while there is no definition of the legislation, the lawyers warn: “It is necessary to be up to date on ongoing projects involving the carbon market and carbon capture and storage initiatives, whether in the regulated or voluntary market. And it is of the utmost importance that these organizations seek reliable partners who are in tune with the company's sustainability context... to ensure that the business partner is in compliance with the global standards of this market, which is not at all simple”.

On the global perspective of VCM in 2023, yesterday we previewed on LinkedIn a great article by Bain & Company "Voluntary Carbon Markets in 2023: A Bumpy Road Behind, Crossroads Ahead" . Four uncertainties are highlighted:

• Long runway to reach consensus on credit quality and integrity of demand

• Shifting policy frameworks

• Persistent uncertainty about the eligibility of carbon credits

• Growing public scrutiny and “greenwashing” accusations

Click on the image below for more details from this helpful Bain & Company report.

And in the same vein, be sure to review these two recent posts:

• 1st Plenary Meeting of the "Partnership for the Implementation of Article 6 of the Paris Agreement"

• The Integrity Council for the Voluntary Carbon Market (ICVCM) will release the "Carbon Core Principles" in March

2023 will be an important year from a regulatory and integrity (rules) point of view for Voluntary Carbon Markets (VCM).