IETA Issues New Guidelines For Corporates On Carbon Credits

IETA Issues New Guidelines For Corporates On Carbon Credits - Carbon Herald

The International Emissions Trading Association (IETA) has unveiled new guidance for businesses looking to utilize carbon credits in their pursuit of the Paris Agreement’s goals. 

IETA‘s annual European Climate Summit served as the launchpad for the organization’s “Guidelines for High Integrity Use of Carbon Credits.”  

These guidelines provide clear and well-defined recommendations for companies on incorporating carbon credits into their climate strategies in a way that aligns with the Paris Agreement’s objectives.

Relevant: New Report From IEA And GenZero Examines The Roles Of Carbon Credits, Public And Private Funding For Reaching Net Zero

The document emphasizes establishing clear use cases for carbon credits within corporate strategies. 

However, it underscores that such use should always be complemented by internal efforts to directly reduce emissions across all relevant categories, while adhering to ambitious near and long-term goals. 

While the guidelines address these broader issues, they don’t delve into the specifics of setting net-zero roadmaps.

According to Andrea Abrahams, IETA’s managing director for voluntary carbon markets, a staggering 81% of the world’s largest companies lack net-zero targets (data from Allied Offsets).

Relevant: Bursa Carbon Exchange Joins IETA To Expand The Voluntary Carbon Market

“The IETA Guidelines serve as a strategic framework for companies to mobilise finance and incorporate carbon credits into their climate strategies. The private sector has a critical role to play and we need to act now,” Abrahams said.

New modeling suggests a high probability of companies falling short of their near and long-term net-zero targets, potentially jeopardizing the Paris Agreement’s objectives.

Carbon Growth Partners chimed in, stating: “The world’s best companies are setting targets to meet a critical path to net-zero carbon emissions. IETA’s new guidelines for companies make it clear that the path involves reducing emissions and offsetting the remainder until they hit that target. This clarity is much needed in an arena that has suffered from confusion for too long.”

A Global Trend

IETA’s announcement comes only a week after a similar, but very controversial statement was issued by the Science Based Targets initiative (SBTi), which said it would provide clearer guidance on how companies can address their Scope 3 emissions with carbon credits. 

The announcement made headlines and stirred up conflict within the organization, as staff members protested against the Board’s decision. 

The scandal resulted in the SBTi Board of Trustees issuing a clarification to its original statement, which says that ‘any use of EACs (Energy Attribute Certificates) for Scope 3 will be informed by evidence’.

Both IETA’s and the SBTI’s announcements, however, are clear signals of a rising awareness of the importance of carbon credits and the voluntary carbon market (VCM) in reaching net zero and carving out a sustainable future. 

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