reNature’s place in carbon trading
Published on: May 19, 2021
Insetting as a holistic approach to foster responsible business
Carbon emission reduction is a no-brainer for most organizations today. However, a credible contribution to climate change mitigation and adaptation requires front-runners to do more than buying credits. Through our Regenerative Agroforestry projects, reNature can offer carbon insetting through nature-based solutions and help companies on their path towards achieving net zero emissions. In partnership with leading third-party certification organisations we ensure that you are aligned with industry standards – and progressing beyond them. Carbon insetting will not only support the contribution to climate positive solutions, but also positively impact local farmers, communities, soils, and biodiversity.
Our contribution to the carbon market
The Voluntary Carbon Market is growing. As a recent McKinsey report indicates, the demand for carbon credits could increase by a factor of 15 or more by 2030 and by a factor of up to 100 by 2050, and overall, the market for carbon credits could be worth upward of $50 billion in 2030.
Indeed, more companies are aligning themselves with this agenda: in less than a year, the number of companies with net-zero pledges doubled, from 500 in 2019 to more than 1,000 in 2020, McKinsey counted.
However, there is not just one type of carbon credit, and not just one way in which the market works.
According to McKinsey, currently ‘high-quality’ carbon credits are scarce because accounting and verification methodologies vary and because credits’ co-benefits (such as community economic development and biodiversity protection) are seldom well defined.
Moreover, the idea of carbon offsets itself has been under scrutiny from critics.
“Planting trees for carbon offsets is little better than green-washing in many people’s eyes. But what if this sustainability cliche were turned on its head – if trees were planted to support agroforestry within a business’s direct supply chain?” this article in the Guardian read.
Although carbon offsetting through credits has become commonplace, over recent years offsetting has been challenged as it does not focus enough on reducing emissions at the source. As a result, the more holistic alternative of carbon insetting is gaining traction.
Insetting is the practice where carbon reductions are placed within a business’s direct supply chain, leading to the capture of carbon dioxide to offset the business’ operational emissions as well as several positive ecological, social, and economic outcomes. We follow ICROA’s ‘first working definition’ where a company invests in the development of a carbon offset project within its own supply chain, and purchases all generated carbon credits to offset its operational emissions. We at reNature applaud a shift towards insetting, and prioritise working within companies looking to work according to that model.
reNature can offer this service directly through our regenerative agroforestry Model Farm and Model School projects, instigating carbon drawdown through transitioning towards regenerative agroforestry and grazing practices that store more carbon in trees and soils. Working with ICROA affiliated partner organisations that work with ICROA recognised standards, we ensure we meet internationally recognised carbon market principles of additionality, uniqueness, measurability, and verifiability.
So, where does that position reNature in the carbon market?
Thanks to our extensive network of farmers and position in the ecosystem of carbon stakeholders, we can give access to project pipelines, connecting the different actors involved in the crediting process. reNature and partners can provide:
1) Nature-based solutions to carbon insetting through Model Farm and Model School projects, sequestering carbon in trees and soil
2) Feasibility check on carbon credits
3) Estimate sales and production volumes
4) Choice of standard
5) Finance acquisitions
Drawdown using regenerative agroforestry and grazing
Regenerative Agroforestry has a significant potential to draw down carbon from the atmosphere into living trees and the soil. One meta-analysis estimates that one hectare of a young agroforestry system annually takes 27 (+-14) tons of CO2 equivalents out of the atmosphere. Another meta-analysis finds that a mature agroforestry system has on average 74 tons/ha more C in tree biomass compared with sole cropland‐ or pasture‐based land uses without trees.
Seeing the potential on a global scale, a recent McKinsey report indicates that to achieve global warming limited to 1.5 degrees celsius, Natural Climate Solutions (NCS) projects could yield nearly a third of that target (close to 7 GtCO2 per year by the end of this decade), mainly from avoided deforestation and peatland impact, reforestation, and soil sequestration in agriculture.
Many are the ways of using carbon payments to support the work of farmers that are stewarding the land. They can provide the means for farmers to make long-term investments which they might otherwise not be able to do, along with the opportunity to transition towards regenerative practices. Payments for carbon can support the development of broader-scope regenerative projects.
Typically carbon benefits are paid for shortly after carbon reductions have been realised and credits have been generated, although there are also forms of up-front credits, supporting a project in its infancy, when cash flow is most needed. In other cases, up-front agreements on carbon credits generation can be used as a de-risking component in financing schemes, leading to lower interest rates and longer pay-back periods.
Either way, carbon benefits are not the only revenue that regenerative agroforestry brings. A holistic approach, regenerative agroforestry also benefits farmers and communities’ livelihoods as well as providing many other valuable ecosystem services, such as supporting biodiversity, fertile soils, a healthy hydrological cycle, and multiple sources of yield (be they food, fuel, fibers or timber).
Carbon sequestration with Agroforestry in Laikipia, Kenya
At reNature’s Model Farm with the Laikipia project in Kenya, carbon sequestration through agroforestry was translated into verified carbon credits together with Rabobank. Using remote sensing technology, carbon stored in the biomass of trees is translated into carbon credits available at the carbon market. 90 to 95% of the value of these credits flows back to the farmers. Microsoft has bought the first 500 credits generated through Laikipia, showing that the time is right for corporates to invest in the nature-based carbon sequestration solutions.
Join us as a Carbon Partner
reNature is working with partners worldwide to ensure we meet industry standards to ensure your peace of mind. We’re building a network of organizations worldwide that support us in the calculation and third-party verification and certification of carbon reductions and removals, and the generation of carbon credits that can be sold and used in the voluntary carbon market.
We have already established partnerships with Rabobank and Climate Neutral Group that can assist in the generation of verified carbon credits, and are welcoming others to join these frontrunners amongst our pool of carbon partners.
“Since industrialization began, we emitted huge amounts of CO2. If now everything would be CO2 neutral or net zero, all CO2 emitted in the last 200 years would still remain. Therefore and because we are still emitting, we need a system where we can reward CO2 removal. Incentivising a farmer sequestering carbon can have significant impact, not only to combat climate change, but also to increase food security and biodiversity and improve farmer livelihoods in developing countries.”Jelmer van de Mortel
Innovation Lead, Rabobank
Pushing the boundaries with cutting-edge technology
reNature’s Science Team is committed to co-create and push forward the use of cutting edge technologies for assessing carbon sequestration in our projects. We’re working together with bright minds worldwide – from universities to tech start-ups – to move the field of carbon assessments forward. By supporting new ways to collect and analyse data on carbon, we are at the forefront of the market, bringing cost-effective, innovative, and high-impact methods that support the measurement and evaluation of carbon insetting.
Together with potential Science Partners, we’re examining the latest development in technologies and innovations: ground-based measurements, remote sensing with satellites and drones, machine learning algorithms, and allometric equations are examined for their cost effectiveness and scientific robustness and accuracy to come to the most suitable monitoring and evaluation approach. We aim to work open source where possible, as open source ensures maximum transparency and fosters innovation in the carbon market.
Although our current projects are confidential due to the innovative nature of the topic, we are proud to work with several potential Science Partners, financial institutions, buyers, and producers in several geographies in further developing this concept.