What role do carbon credit agencies play in carbon markets?

The Paris Agreement aims to limit the increase in the global average temperature to well below 2°C above pre-industrial levels and pursue efforts “to limit the temperature increase to 1.5°C above pre-industrial levels.” It will take ambitious collective action to achieve these goals.

Progress in this area requires government intervention, but the private sector plays a crucial role too. As it is not yet technologically or economically feasible to avoid 100% of emissions globally, carbon credits are an essential solution to meet net zero targets. 

Carbon offsetting, however, is largely scrutinized—and rightly so. It is difficult to find credits that actually minimize greenhouse gas emissions and deliver real climate impact. To address this challenge and offer greater transparency to credit quality and risk, carbon credit agencies have emerged. 

Based on independent and objective analysis, a carbon credit rating agency issues ratings - often in the form of letter grades - to assess the likelihood that a carbon project delivers real climate impact. Like debt ratings, carbon credit ratings help buyers understand the risk associated with a specific credit. For example, a low carbon credit rating would indicate the project is high risk (i.e. likely not meeting the carbon removal or avoidance goals it claimed it would).

The need for carbon markets to prioritize emission reductions  

A growing number of companies have stepped up to the challenge by setting and investing in net zero targets to decarbonize company operations and value chains. Today, organizations covering more than 90% of global GDP have made net zero commitments—a strong start to a low carbon economy. 

しかし、これらのネット・ゼロ目標のほとんどは2030年と2050年のものです。また、目標未達成の場合の影響を明確にしている企業はさらに少ない。

It is imperative companies mobilize direct decarbonization of Scope 1, 2, and 3 emissions at rates in line with 1.5°C pathways, but it is not yet possible to avoid 100% of GHG emissions globally. Technology to decarbonize with speed and scale is not readily available, particularly in sectors like aviation, construction, mining, and agriculture. 

気候変動リスクへのエクスポージャーは業種によって均等ではありませんが、緊急性はすべての業種に当てはまります。高品質の炭素クレジットは、残存排出量をカバーし、当面の年間排出量を補うためのギャップを埋めるために使用することができ、また使用すべきです。 

At Sylvera we are strong believers in pulling all the available levers we have to halt and avoid the worst impacts of climate change. SBTi also endorses and encourages the use of high-quality carbon credits, both avoided emissions and removals. 

地球温暖化がもたらす壊滅的な影響に直面している世界では、私たちは「イエス・アンド」あるいは「バイ・アンド」のパラダイムに移行しなければなりません。言い換えれば、現在利用可能なすべての解決策を活用する必要があるということです。炭素クレジットへの投資は、野心的な排出削減とネット・ゼロの道筋を補完する不可欠なものです。 

Just as one diligently makes deposits into their retirement account to take advantage of compounding interest, so too must we invest in deep decarbonization and emissions compensation today. The path to 1.5°C becomes a lot steeper and much more expensive if we drag our feet. 

To help eliminate friction in the decarbonization journey, carbon credit rating agencies enable buyers to better navigate and invest in carbon markets.  

How credit agencies help companies reduce carbon footprints

Agencies, like S&P or Moody's, emerged to create a global language and understanding of credit ratings that unlocked value in the debt markets. 

独立した客観的な分析に基づき、格付け機関は債務発行体が債務を履行できる可能性を評価するための等級を発行します。これらの格付けは、投資家がリスクとリターンを管理するために必要なデータを提供します。

炭素クレジットの品質について共有された言語や統一された理解がないため、あいまいな部分が生じ、結果的に炭素市場の成長と健全性を阻害してきました。炭素クレジットの格付けは、炭素市場の不透明さの中で灯台となり、買い手が信頼できる透明性と分析を提供することができます。 

Carbon credit ratings agencies like Sylvera, BeZero, Calyx and Renoster have emerged to help bring clarity and confidence to carbon credits. Today, each agency has a different approach to evaluating the quality and risk of carbon projects, and there is no universally agreed upon definition of “high-quality credit.” Work must be done to calibrate scales and educate buyers about different assessment approaches.

価格と品質の関係を示す透明性とデータは、市場が成長し、安定し、純粋かつ効果的に排出削減や炭素除去を行うプロジェクトに資本を供給するのに役立ちます。したがって、投資家が投資の正当性を確保し、リスクを管理し、受託者責任を果たすためには、カーボンクレジット 格付けデータが必要です。

VCMの複雑な仕組みと最適な進め方について詳しく知りたい方は、こちらをご覧ください、 サステナビリティ関係者向けガイドをダウンロード.

The Sylvera difference 

1900年代初頭に格付け会社が登場したことで、金融市場が恩恵を受け、買い手にとって信頼性と透明性が高まったのと同じように、炭素市場も信頼と規模を拡大するために、プロジェクトの設計と継続的なパフォーマンスを明確にする、強固で独立した最新のデータが必要です。 

Sylvera's carbon credit Ratings give nuanced insight into the quality and risks of individual carbon projects. This is what makes our ratings the most accurate and reliable.

プロジェクト・タイプに特化し、専門家の査読を経た独自のフレームワーク

Our innovative approach works from the bottom up. First, we build rigorous frameworks and production systems to accurately test project design, carbon accounting, and climate impact claims. This means for each project category (i.e. REDD+, ARR, RES, IFM, Biochar, etc), we develop and apply different frameworks, as it is the only way to accurately assess quality across fundamentally different activities. 

Simply put, if you evaluate an improved forest management project (IFM) projects and a biochar project with a generic framework, the results will be inaccurate. 

Unlike other credit ratings agencies, Sylvera's frameworks are peer-reviewed by a committee of experts and carbon market stakeholders—including project developers & registries—to ensure scientific consensus, and ensure our ratings reflect the parameters for a market-defined high-quality credit. In the spirit of transparency, we publish our frameworks, so buyers understand exactly what we test and how we do it.‍

炭素会計、付加性、永続性、コベネフィットのスコア

Sylvera Ratings are derived from the holistic analysis of a project's carbon accounting, additionality, and permanence. Each project we rate receives a discrete letter rating (AAA-D) and an in-depth report. 

For co-benefits, we produce a separate score based on our examination of the project activities' impact on local biodiversity and communities. Corporate buyers are increasingly interested in understanding the co-benefits of carbon projects. A crucial dimension of carbon credits, strong co-benefits can often have a strong impact on price.‍

圧倒的な深さと正確さ

Sylvera is the only carbon credit rating agency that has invested millions of dollars and thousands of hours conducting field research; synthesizing optical, radar, and LiDAR data to validate emissions reductions claims; and building and calibrating machine learning models to reconstruct individual carbon, strength of baseline, and financial additionality models to validate emissions reductions or removals claims and to evaluate project economics. 

‍Independent data validation

Our expert analysts leverage independently verified data and advanced machine learning (ML) technology to test the accuracy of credit issuances and claims. Comparing independent data specific to each project against the data reported in the project's documentation is the cornerstone of high-quality due diligence. For example, we use market-leading geospatial ML models when rating nature-based solutions to assess additionality and permanence, and ensure pinpoint accuracy.

‍The world's largest dataset of carbon stored in trees 

Sylvera is LiDAR scanning forests to build the world's largest dataset of carbon stored in trees and above-ground biomass. By collecting vast quantities of this data around the world in different biomes, it Sylvera can estimate both biomass and carbon stocks for forests at an unprecedented accuracy using satellite data. Access to this data makes tackling climate change much easier.

‍Building legitimacy in the carbon markets‍

Sylvera engages with several initiatives, like the Integrity Council for the Voluntary Carbon Market (IC-VCM), that are focused on building integrity and clarity in carbon markets. The IC-VCM is built on a simple principle: build integrity and scale will follow.

Sylvera engages with both supply-side and demand-side initiatives:

• On the supply-side to ensure that investments in carbon credits are channeled to effective climate solutions
• On the demand-side to give buyers and the wider public confidence in the integrity of the market

Sylvera also supports supply-side integrity as a member of Verra's digital MRV working group. The multi-stakeholder advisory committee identifies opportunities for the application of digital technologies within carbon project standards and methodologies to increase accuracy and efficiency, as well as the impact of projects. 

Sylvera Ratings are a complementary solution to integrity-building initiatives. We will continue to engage with market initiatives to ensure carbon markets have the biggest and most positive impact on the climate, nature, and local communities. 

Companies engaging with carbon markets can often find themselves in the crosshairs of greenwashing claims from the press and other stakeholders. Sylvera's in-depth carbon Ratings give buyers access to reliable and accurate information. That way, companies understand risks to their portfolio before a project is called out for not meeting its climate obligations.

Moreover, our comprehensive Ratings enable companies to easily invest in and build a high-quality carbon credits portfolio, which means confidently delivering on climate action commitments while managing reputational risks.

Want to learn more about Sylvera? Request a free demo to see our industry-leading solution in action.