As more and more organisations enter the biodiversity market, Verra strives to ensure that the high standards of projects are maintained, as Naomi Swickard, Chief Program Officer, outlines.
The UN says biodiversity continues to deteriorate and decline across the globe. How do we reverse that? And what role do standards organisations like Verra play in that?
Standards organisations like Verra play a catalytic role in this context. We set the rules by which you can develop projects, issue credits, or make claims. These projects implement a variety of activities, including emission reductions, biodiversity conservation, and socio-economic improvements. The credits and claims the projects make are of interest to buyers and investors and can therefore drive demand for investment in the space. When you're talking about a carbon offset, we have a built-in demand coming from the fact that countries have targets under the Paris Agreement and that there's a growing realisation among companies that if we don't invest in climate mitigation then it's going to hit their bottom line. We can use these incentives to drive investment in activities that reduce emissions and increase sequestration.
On the biodiversity side, it's a little more complicated because we don't have this same type of signal that requires people to invest. However, we have the ability to package biodiversity benefits with emission reductions. And because we're seeing an increased focus on sustainable development, which includes biodiversity, in carbon markets, there is a chance for these markets to also significantly impact biodiversity.
How do you see successful land management for conservation, biodiversity and carbon sequestration all being connected with sustained economic benefits?
The same measures that protect forest carbon and help improve and protect biodiversity also have socio-economic benefits. Verra has specialized in nature-based solutions, and in this category, a properly designed project that may have a primary role as a carbon project is generally also going to focus on alternative livelihoods, conservation, and biodiversity protection. We know that the end goal is to move towards more decarbonisation and an increase in sequestration.
However, if we take away the finance for existing standing forests – in other words for preventing deforestation and degradation – then we have so much more to lose. Not only will this increase carbon pollution, but we'll also lose all the biodiversity and the community benefits from those forests as well.
One of the best things we can do is look at this holistically, within project areas and landscapes, so that we're maximising outcomes not only on carbon but also on biodiversity, livelihoods, and the plethora of sustainable development benefits that can be attached to these projects.
We also have two other standards, in addition to our Verified Carbon Standard (VCS), which are related to the UN Sustainable Development Goals (SDGs): The Sustainable Development Verified Impact Standard (SD VISta) is a framework for measuring and monitoring any sustainable development impact, including on biodiversity, health, environmental, or community issues. Then you can either create a claim based on those impacts or even go all the way to an asset, so a tradeable unit like a carbon credit. We're seeing a lot of projects use SD VISta to quantify the benefits around things like biodiversity.
We have also developed, with several partners including Rainforest Alliance and Conservation International, an assessment framework called LandScale, which is similar but focused on an entire landscape. Existing certifications in this field either tend to focus on just one aspect of sustainability or are site-specific.
However, when it comes to conservation, biodiversity and sequestration you can't actually address any of these issues without looking at the whole landscape, they're all interconnected. Water quality and quantity issues in one part of the landscape can impact forest growth or agriculture in another part, for example.
LandScale is about measuring and monitoring the whole landscape, holistically, across a range of indicators to drive finance to address key sustainability issues and see improvement overall.
So, through VCS, SD VISta, or LandScale you can look at maximising those outcomes across the connection between biodiversity, carbon, conservation, and the economy.
Has there been a big uptick in projects looking for certification? How do you encourage more projects so more companies are offsetting their emissions?
There has been a huge growth in the market. From our side, our issuance volume has doubled from 2020 to 2021. A lot of developers are also doubling or tripling the size of their businesses over the next few years, so there's clearly growth. I think that's a reflection of companies waking up to the fact that climate change is going to impact their core business, so they're looking to address their environmental impact.
That said, our goal is not to grow the size of the pie, our goal is to make sure we are supporting the transition to a decarbonised world. So, companies first need to set their net zero targets and focus on internal mitigation, making sure there's a concrete plan to be working towards net zero and reducing their internal emissions.
Offsets are a bridge to help us compensate for those emissions that cannot be avoided or reduced today as a transition to decarbonised economies.
For us the key is about using our work to drive investment as quickly as possible in climate mitigation and biodiversity conservation today, while we're all aiming for a net zero goal.
Annual issuance of VCS projects that are also certified under the Climate, Community & Biodiversity (CCB) Standards
Looking at the biodiversity COP, do you feel more emphasis is placed on the transition to green energy and more effort, attention, and financing is needed on a global governance scale on biodiversity preservation and carbon sequestration?
Renewable energy is important and there's a lot of attention on that, especially at a national scale. As countries are trying to meet their climate targets, they tend to focus first on the biggest point sources of emissions, which is why we see energy production regulated first. But the biggest growth in carbon markets has been on nature-based solutions and that is partially because how critical they are to the overall climate solution. A second important reason is the fact that these solutions have biodiversity and livelihoods benefits as well as other outcomes that companies look at beyond carbon.
Nature-based solutions have additional complexities as they are related to the livelihoods and rights of local communities. This is the reason governments regulate these large point sources of emission first, but we should not lose sight of the importance of tackling the more complex solutions as well.
Governance is critical for the implementation of mitigation within countries but putting the necessary policies and regulations in place is very time-consuming and we really can't wait for that if we want to avert disastrous climate change and loss of biodiversity. Here is where voluntary markets come in; they help drive that finance to emission reduction and biodiversity conservation while governments take the time they need to invest in and establish policy. Private finance moves quickly, it's nimble and can be directed to site-based interventions.
When we're talking about biodiversity, it's critical that we're protecting those forests that are most threatened – and they're being lost every single day. Because we can move private finance to forest conservation more quickly, we can help protect the biodiversity in those forests while governments are getting their policies in place and implementing them.
What's next for Verra?
We continue to focus on expanding and refining our standards programmes and to increase their potential and reach. SD VISta and LandScale help direct finance to measuring and therefore increasing the impacts in these areas beyond emission reductions. The essential value of standing forests is critical in this context, so I think a lot of that of our focus will continue to be on growing and continuing to update our work in that sector – and on communicating this value so we can continue to drive finance to it and don't lose those critical ecosystems.
