Standard to give CO2 emissions market a boost

A NEW global carbon offset standard has been launched to help
boost confidence in the voluntary carbon market.

The Voluntary Carbon Standard (VCS) will provide quality assurance
for the certification of credible voluntary offsets in what is a
booming market.

Market analysts estimate that annual transactions in the voluntary
carbon market could reach $4bn in the next five years.

Although direct cuts in emissions are key to minimising the effects
of climate change, carbon offsetting allows additional investment
in carbon reduction over and above what Government regulations have
achieved so far.

Voluntary carbon offsetting allows companies, public bodies and
consumers to purchase “credits” generated from projects
that either carbon-reducing or carbon capturing.

However, the number of different voluntary carbon markets and
companies offering offset schemes, and its intrinsic links with
mandatory carbon markets has led to concerns over its legitimacy.

According to Mark Kenber, policy director of non-governmental
organisation (NGO) The Climate Group and co-chaiman of the VCS
Steering Committee, VCS means that businesses and consumers can now
trust the offsets they buy.

“It's robust quality assurance will trigger a new global
confidence in the voluntary market from corporate buyers, consumers
and policy makers. It is vital for the environment and for the
growth of an important global market.”

VCS's introduction marks the end of a two year consultation led
by The Climate Group, The International Emissions Trading
Association, and the World Business Council for Sustainable
Development (WBCSD) with industry sectors, NGOs, and market
specialists.

Adam Kirkham, programme manager for the WBCSD, said that the VCS
would provide an additional incentive to business to invest
internationally in low carbon technologies.

“This will allow firm to monetize gains from their early
voluntary actions via a robust standard supported by third-party
verification that delivers environmental integrity, consumer
confidence and market credibility.”

Currently only larger firms with high energy consumption can
benefit from carbon trading initiatives such as the EU Emission
Trading Scheme (EUETS), which is designed to give firms financial
encouragement to reduce their CO2 output.

Each company is given a certain number of allowances and if
emissions are reduced below that figure, companies can then sell
the unused allowances for profit.

Earlier this year a new voluntary carbon trading exchange – CredEx
– was set up in the Tees Valley to allow firms not subject to caps
on carbon emission to offset all or some of their carbon emission
for the first time in the UK.