BeZero: Higher Quality Carbon Credits Command Greater Price Premiums

BeZero: Higher Quality Carbon Credits Command Greater Price Premiums - Carbon Herald
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According to rating agency BeZero Carbon, higher-quality carbon credits appear to command much greater price premiums, when compared to their lower-quality counterparts. 

The findings were made based on data from the agency’s own rating scale, where carbon credits were and their respective pricing were traced since April 2022. 

As a result, BeZero Carbon found that projects rated in the three highest notches of its rating scale delivered credits with a price premium of roughly 80% higher than credits with a lower rating. 

According to BeZero Carbon’s observations, the correlation between price and quality has been noticeably reinforced in the latter half of 2023 all across the voluntary carbon market (VCM). 

The same goes to show that the importance of ratings is increasing rapidly and can safely be considered a driving force for prices in the VCM. 

Relevant: Xpansiv Started Consultation On Instruments Aligned With ICVCM Core Carbon Principles

The BeZero Carbon Rating determines the quality of carbon credits with the help of an eight-point scale, which ranges from ‘lowest likelihood’ to ‘highest likelihood’ of achieving of removed or avoided CO2 equivalent (CO2e).

Sebastien Cross, co-founder and Chief Innovation Officer at BeZero Carbon, said: “Independent carbon ratings are vital if the voluntary carbon market is to become more efficient and scale up. This research demonstrates that the market is maturing and moving towards a pricing structure that better reflects the underlying risk of individual carbon projects.” 

“We are proud that our ratings are moving the market and are being used effectively by businesses to incorporate high-quality carbon credits into their net zero strategies, and hope to see these trends continue through into 2024,” Cross concluded.

Read more: BeZero Revolutionizes Carbon Credit Tracking With New Tool

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