EDITORIAL: Even with the SBTi's self-generated controversy it seems more is just around the corner for the VCM

25 Apr 2024

Quantum Commodity Intelligence – The row over the Science Based Targets initiative's announcement earlier this month about the possible use of some carbon credits to meet companies' scope 3, value-chain greenhouse gas (GHG) emissions shows no signs of abating, although the organisation leadership has now come out with follow-up statements to clarify the situation.

Nothing has currently changed, but it might once due process has been followed. No one seems to have resigned and it could be some time before there is final clarification on this. Just what the voluntary carbon market (VCM) needed as it tries to emerge from the media controversies of last year, another layer of uncertainty.

Research by Bloomberg New Energy Finance saying the situation could deliver a "mega boost" to the VCM, currently isn't what many market participants feel. "All this noise around SBTi is extremely unhelpful," one market source told Quantum over the last couple weeks.

The source indicated that even if SBTi agrees to allow offsets to be used for scope 3 emissions, it might not generate the expected demand as the move "will look tainted now because the scientists disagree with it and it was taken prematurely".

Therefore, corporates, already wary of the VCM over the media coverage and watching their own reputational risk to avoid claims of greenwashing, may well continue to avoid using carbon credits to meet GHG targets. That's only  a theory, but the way SBTi's leadership has come out to say on more than one occasion that their April 9 announcement does not change anything currently has only added to what is clearly a mess.

And the VCM may be in for some more controversy; this time from a familiar source: the mainstream media.

A social media post from the chief executive of a developer and financer of nature-based climate solutions said this week that a "major UK media outlet will publish another negative article concluding that Reduce Deforestation and Degradation projects (REDD+) do not produce real climate benefits". This may have been published by the time you read this, but, if not, we will have to wait and see how to judge the merits of the article.

Another project developer, Canada-based Carbon Done Right (formerly known as Klimat X), published a statement last week, mainly about a milestone being reached in its most advanced rewilding project in Sierra Leone. However, the same statement also made reference to an enquiry to the company by a UK-based mainstream media outlet.

Carbon Done Right said in a statement on April 16 that an enquiry had been made by The Times newspaper April 3 about the company's activities in West Africa with the possibility of the media outlet publishing a story. "The company has been engaging with the newspaper in an open and transparent way, providing detailed responses and context," it said.

The company continued: "Some of the questions that have been posed suggest that much of the newspaper's sourced information is inaccurate, incomplete or based on misunderstandings of the company's operations, which the company has responded to in clear and detailed terms." While we are not party to the newspaper's questions, I imagine the response from Carbon Done Right will be a very familiar one to companies in the VCM dealing with the mainstream media.

Let's be honest, it's hard to imagine The Times is planning a story outlining the merits of Carbon Done Right's project. Of course we can't be 100% sure, and as The Times didn't respond to my enquiry about their enquiry, we at this stage have to take the company's word about the newspapers investigation.

I understand from a colleague that the role of the media and the carbon market was the topic of a panel discussion at last week's IETA meeting in Florence.

The problem being that mainstream media is never going to be interested in the positives of carbon projects, they want bad news, unfortunately – it gets more hits and pick ups elsewhere. There isn't an answer to this; even if 99.9% of projects were perfect (and we know they're not), the 0.1% leaves enough out there to generate column inches or feed an anti-market group with what it needs to thrive.