{"id":9124,"date":"2024-04-30T14:45:29","date_gmt":"2024-04-30T18:45:29","guid":{"rendered":"https:\/\/www.fundamentalanalytics.com\/?p=9124"},"modified":"2024-05-06T14:46:33","modified_gmt":"2024-05-06T18:46:33","slug":"carbon-market-news-roundup","status":"publish","type":"post","link":"https:\/\/www.fundamentalanalytics.com\/pt\/carbon-market-news-roundup\/","title":{"rendered":"Carbon Market News Roundup"},"content":{"rendered":"\n\n\n
Welcome to our monthly newsletter,\u00a0Carbon Market News Roundup, the goal of which is to introduce our audience to a new asset class market in the making: the carbon market.\u00a0Our previous issues, along with the rest of our commentaries, may be read\u00a0here<\/a>.<\/p>\n

Last issue<\/a>, we focused the record-high greenhouse gas emissions that 2023 saw, as well as the $3 trillion clean energy investment gap in the way of achieving net-zero emissions by 2050.\u00a0This issue, we look at recent efforts to bolster confidence in voluntary carbon markets, as well as highlighting the development of carbon markets in Africa, which holds enormous implications for climate finance.<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n\n\n\n
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The Voluntary Carbon Market Needs Integrity<\/p>\n

US to Advance Carbon Offset Standards to Prevent Greenwashing<\/a><\/p>\n

Jennifer A Dlouhy,\u00a0Bloomberg<\/p>\n

Carbon Prices and Voluntary Carbon Markets Faced Major Declines in 2023, What\u2019s Next for 2024?<\/a><\/p>\n

Jennifer L,\u00a0Carboncredits.com<\/p>\n

Analysis: How some of the world\u2019s largest companies rely on carbon offsets to \u2018reach net-zero\u2019<\/a><\/p>\n

Josh Gabbatiss,\u00a0CarbonBrief<\/p>\n

The US is announcing tougher standards for carbon offsets in a bid to lend greater integrity to carbon markets, with the goal being to ensure that these markets drive real emission reductions rather than \u201cgreenwashing.\u201d Climate advisor John Podesta said that offsets should represent real, additional, and permanent emission reductions (meaning genuine emission reductions that wouldn\u2019t have occurred without action), that carbon trading regimes should avoid carbon leakage (where reductions in one area are offset by increased pollution in another), and that companies should not use carbon offsets to substitute efforts to reduce their emissions.<\/p>\n

Other organizations have also been calling for enhanced credibility in carbon markets in recent months, such as the\u00a0Commodities Futures Trading Commission<\/a>, the\u00a0International Emissions Trading Association<\/a>, and the\u00a0Integrity Council for the Voluntary Carbon Market<\/a>. These guidelines may inject some sorely needed confidence back into the voluntary carbon market, which had a tumultuous year in 2023. A handful of major corporations, including names such as Shell and Nestl\u00e9, retreated from public carbon offsetting schemes last year following a series of greenwashing scandals from major carbon offsetting projects. The crisis in confidence had a huge effect on prices; the Xpansiv market CBL (the world\u2019s largest spot carbon exchange) recorded carbon offset prices falling over 80% in an 18-20 month period.<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n\n\n\n
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Source<\/a><\/p>\n

Carbon markets play a vital role in achieving climate goals through the mobilization of private finance, and integrity in these markets is critical to achieve this. When companies or investors trust that offsets are genuine \u2013 that they represent real emissions reductions \u2013 they are more likely to participate in carbon markets. Because investors and companies seek reliable and transparent markets, high-integrity carbon markets attract investment, driving innovation and sustainable practices.<\/p>\n

Despite the recent troubles in voluntary markets, demand is undeniable. First, as seen in the chart below, over six thousand companies have committed to emissions reduction targets.<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n\n\n\n
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Source:\u00a0Nat Bullard<\/a><\/p>\n

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This includes around two-thirds of Fortune 500 companies, as seen below.<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n\n\n\n
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Source:\u00a0Nat Bullard<\/a><\/p>\n

These commitments drive corporate demand for carbon offsets. With many of these commitments being net-zero goals, these corporations will find that much of their emissions are not easily reduced in time to meet these goals. This is where carbon offsets come in \u2013 around two-thirds of the world\u2019s biggest companies with net-zero goals are using offsets to help meet their goals, which allow these firms to claim emissions reductions while they invest on long-term structural emission reduction strategies. A credible voluntary offset market is essential for stakeholder trust and investor confidence, as well as to make a real difference in the fight against climate change. Given this built-in demand, carbon markets are not likely to go anywhere in the near future despite their recent troubles.<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n\n\n\n
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The Development of Carbon Markets in Africa<\/p>\n

Could carbon credits be Africa\u2019s next big export?<\/a><\/p>\n

The Economist<\/p>\n

Can carbon markets solve Africa\u2019s climate finance woes?<\/a><\/p>\n

Ashoka Mukpo, Mongabay<\/p>\n

Africa Clean Sweeps into $900B Global Carbon Credit Economy<\/a><\/p>\n

Saptakee S,\u00a0Carboncredits.com<\/p>\n

A UN-backed consortium, the African Carbon Markets Initiative (ACMI), sees a golden opportunity for Africa in carbon credits. They estimate the continent could become a major seller, raking in $100 billion annually by 2050. This would be a massive boost, considering Africa’s foreign direct investment has never exceeded $80 billion a year. Kenyan president William Ruto is particularly enthusiastic, calling carbon credits an “unparalleled economic gold mine” and Kenya’s “next significant export.”<\/p>\n

Africa has participated in carbon markets for decades, but in a limited way. It only captured 3% of credits issued under the Clean Development Mechanism, the first UN-backed international carbon market.<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n\n\n\n
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Source:\u00a0The Economist<\/a><\/p>\n

Climate finance initiatives in Africa has led to benefits outside of environmental ones. For example, carbon markets have been a boon for cooking-fuel startups in Africa, which aim to develop and scale cookstoves that are cheaper to fuel, healthier for African households, and produce fewer emissions that traditional charcoal or firewood cookstoves. Nearly a quarter of all African carbon credits on voluntary markets come from such projects. The Clean Cooking Alliance, a donor-funded organization, reports that over half of the 30 companies they support have used or plan to use carbon markets to attract financing.<\/p>\n

ACMI is determined to expand Africa’s voluntary carbon market. At the September Africa Climate Summit in Nairobi, the United Arab Emirates pledged a significant $450 million to buy credits, and the Johannesburg Stock Exchange even launched its own dedicated voluntary marketplace. ACMI’s efforts, coupled with growing international interest, could turn the continent\u2019s environmental potential into a real economic engine for the continent.<\/p>\n

The development of carbon markets in Africa hasn\u2019t come without problems. African policymakers have been frustrated with persistently-low prices for carbon credits, leading to a UN official calling for a common carbon registry that would align closer to the continent\u2019s free trade area, which analysts expect would boost prices. The official also expressed the need for carbon markets to not be only based on revenues from the sale of credits, but also be focused on the creation of businesses and projects that generate carbon credits alongside co-benefits such as economic development.<\/p>\n

With Africa being one of the continents\u00a0hit the hardest<\/a>\u00a0by\u00a0climate change<\/a>, the development of carbon markets in the continent could support job creation, investment, and increase revenue in some of the places in the world that need it most. As Africa holds such potential in conservation, climate finance, and\u00a0renewable energy<\/a>, it would be nothing less than a tragedy for the continent to be left behind again in the fight against climate change.<\/td>\n<\/tr>\n<\/tbody>\n<\/table>","protected":false},"excerpt":{"rendered":"

Welcome to our monthly newsletter,\u00a0Carbon Market News Roundup, the goal of which is to introduce our audience to a new asset class market in the making: the carbon market.\u00a0Our previous issues, along with the rest of our commentaries, may be read\u00a0here. Last issue, we focused the record-high greenhouse gas emissions that 2023 saw, as well […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"default","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"set","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[1],"tags":[],"class_list":["post-9124","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"_links":{"self":[{"href":"https:\/\/www.fundamentalanalytics.com\/pt\/wp-json\/wp\/v2\/posts\/9124","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.fundamentalanalytics.com\/pt\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.fundamentalanalytics.com\/pt\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.fundamentalanalytics.com\/pt\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.fundamentalanalytics.com\/pt\/wp-json\/wp\/v2\/comments?post=9124"}],"version-history":[{"count":1,"href":"https:\/\/www.fundamentalanalytics.com\/pt\/wp-json\/wp\/v2\/posts\/9124\/revisions"}],"predecessor-version":[{"id":9125,"href":"https:\/\/www.fundamentalanalytics.com\/pt\/wp-json\/wp\/v2\/posts\/9124\/revisions\/9125"}],"wp:attachment":[{"href":"https:\/\/www.fundamentalanalytics.com\/pt\/wp-json\/wp\/v2\/media?parent=9124"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.fundamentalanalytics.com\/pt\/wp-json\/wp\/v2\/categories?post=9124"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.fundamentalanalytics.com\/pt\/wp-json\/wp\/v2\/tags?post=9124"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}