Climate finance: UK-based standard setter VCMI’s introduction of flexibility to carbon credits market could unleash demand, much-needed investment
- VCMI is launching a ‘beta version of a scope 3 flexibility claim’ that will allow firms to use carbon credits to make up ‘some of the gap between where their emissions are and where they should be in any year’
- The flexibility introduced by VCMI is ‘dangerous’, Greenpeace says
Companies might be allowed some flexibility when it comes to buying voluntary carbon credits to offset the carbon footprint of their supply chains under an upgraded guidance by UK-based international standard setter the Voluntary Carbon Markets Integrity Initiative (VCMI).
While this flexibility has attracted criticism from environmental group Greenpeace, the VCMI said it will mobilise urgently needed climate finance otherwise not available.
The upgraded guidelines permit companies to make limited use of quality carbon credits to close the gap between their scope 3 greenhouse gas target emissions and their current emissions in a given year, as long as they have taken other steps to reduce their current emissions. Scope 1 refers to emissions emitted by facilities controlled by a company. Scope 2 emissions arise from bought energy, while scope 3 emissions relate to activities of its suppliers and during the consumption of its products.
The new guidelines will unlock demand for carbon credits from companies that are currently unable to fully meet them but are making progress towards targets aligned with the global goal of containing global warming at 1.5 degrees Celsius, VCMI said.
“Through surveys and analysing the performance of companies towards their targets, it is very clear that many companies all over the world are having challenges with both measuring and reducing their scope 3 emissions,” Mark Kenber, VCMI’s executive director, told reporters ahead of the upgrade guidelines’ announcement.