Sustainable development charity Forum for the Future today releases a report highlighting the current and potential future role of the voluntary carbon market in supporting projects that help the poor.

The voluntary carbon market – where institutions and individuals can buy carbon reductions, usually to offset their own carbon emissions – is experiencing rapid growth.  International trades rose from $58.5 million in 2006 to $258 million in 2007. But as actvity has increased, concerns have been expressed that the voluntary carbon market is a distraction and, worse, that it undermines the need for fundamental change in corporate and individual behaviour. The quality of the credits being offered on the market has also come under scrutiny.  In this debate, the potential for the voluntary carbon market to deliver positive benefits, particularly for people in poorer countries, has been largely overlooked.

The report distils a series of interviews with a wide range of experts.  It explores the opportunities, the barriers and the actions that should now be taken to make the market more effective in delivering both carbon reductions and sustainable development.

Findings:

• Small-scale grass-roots projects, particularly in energy and forestry, are benefitting from a thriving voluntary carbon market.
• Clear standards are vital in maintaining the credibility of the market. 
• But the system should not be rigid and mechanical. It is critical to leave space for innovation and for meaningful connections between buyers of carbon credits and the projects they support.

Alice Chapple, author of the report, said, “Rich people emit most greenhouse gases, while people in the poorer countries are the most vulnerable to the consequences of climate change.  Reducing carbon emissions is vital to avoid dangerous climate change and to prevent increasing levels of poverty and inequality.  The voluntary carbon market enables investment in carbon reduction projects that are relevant to the poor such as forestry and cooking stoves. The best voluntary trading schemes innovate to identify new opportunities for carbon reductions, benefit the poor and inspire new buyers to enter the market.”

The report emphasises that the voluntary carbon market includes a wide range of projects, and there needs to be much clearer differentiation between them   For example, some are designed to be highly rigorous on carbon reduction while others are more innovative and experimental.  The report also highlights the need for buyers to be clear about their objectives in buying voluntary carbon credits and select those that best meet those objectives.  Chapple says, “We are urging individuals and institutions to reassess their approach to the voluntary carbon market.  Of course the first priority must be to reduce emissions, but people should also stop being apologetic about offsets and should engage actively in the debate about how to support offset activities that directly benefit the poor.” 

Download a copy of the report here 

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For more information or a hard copy please contact Ben Tuxworth:
b.tuxworth@forumforthefuture.org.uk or +44 0207324 3690 and +44 (0)7980 224 123     

NOTES TO EDITORS

The UK’s Department for International Development commissioned this report from Forum for the Future in order to explore how the voluntary carbon market works for the poor and how its effectiveness might be improved.  Forum for the Future interviewed 33 experts in this field, including project developers on the ground, offset providers, companies buying offsets, policy-makers and NGOs.  The Forum team also undertook some supplementary desk research.

Interviews were conducted with the following organisations:

BP plc, Carbon Disclosure, Project Christian Aid - Lower Marsh, Co-operative Financial Services Office, BioClimate Research and Development, Lloyds TSB Group plc, Corporate Responsibility Dept Climate Group, Virgin Atlantic Airways, Climate Care, Green Futures,  Global JT Group - Bristol Commons Institute Gold Standard Voluntary Carbon Standard Pioneer Carbon Carbon Neutral Company Care International UK PACE Mercy Corps Ecosecurities: South Africa Office Carbon Capital Ltd Standard Bank Overseas Development Institute Edinburgh Centre for Carbon Management IIED Carbon Trade Watch Carbon Aided FERN Go Zero; Converging World, Office of Climate Change (Eliasch Review Team) and DFID.

Forum for the Future – the UK-based sustainable development charity - works in partnership with over 130 leading organisations in business and the public sector.  Our vision is of business and communities thriving in a future that is environmentally sustainable and socially just. We believe that a sustainable future can be achieved, that it is the only way business and communities will prosper, but that we need bold action now to make it happen. We play our part by inspiring and challenging organisations with positive visions of a sustainable future; finding innovative, practical ways to help realise those visions; training leaders to bring about change; and sharing success through our communications.