Guyana has earned the distinction of being issued the world’s first Carbon Credits that will be eligible for use by airlines in their pursuit of the reduction of global emissions.
This announcement was made yesterday in an Architecture for REDD+ Transactions (ART) Guyana release which also informed that ART issued 7.14 million 2021 vintage carbon credits to Guyana yesterday as the Government of Guyana simultaneously announced the world’s first Paris Agreement corresponding adjustment, which was authorized and reported to the United Nations Framework Convention on Climate Change (UNFCCC).
The release explained that this process fulfills requirements to label the credits as the world’s first that are eligible for use by airlines toward their targets in the 2024-2026 phase of the Inter-national Civil Aviation Organization’s (ICAO) global emission reduction programme, CORSIA [Carbon Offsetting and Reduction Scheme for International Aviation]
TREES (The REDD+ Environmental Excellence Standard) issued by ART, are for actions taken to successfully reduce emissions from forest loss and degradation and maintain one of the world’s most intact tropical forests through a process known as jurisdictional REDD+. The Government of Guyana has subsequently authorized the credits to be used for a range of compliance and voluntary purposes per Article 6 of the Paris Agreement.
Further, as a result of the authorization and reporting to the UNFCCC, Guyana’s TREES credits are eligible for use by airlines to meet their compliance requirements in the first phase of CORSIA, which began on January 1, 2024. There are currently 126 countries voluntarily participating in CORSIA’s first phase, covering roughly 80 per cent of annual emissions from the aviation sector. As such, all participating airline operators with annual emissions over 10,000 tonnes of CO2 equivalent of greenhouse gas emissions, must monitor and report their emissions, and then purchase carbon credits to offset any remaining emissions that exceed a percentage of their 2019 baseline emissions.
Guyana’s ICAO-eligible credits therefore mark a “significant” milestone, given the projections that airline operators could need access to 100-200 million credits for CORSIA’s first phase from 2024 to 2026, coupled with the fact that ART is one of only two crediting programmes to date (the other being ACR) that has received ICAO approval to supply credits for compliance in the first phase. Guyana’s authorisation for the use of the credits, pursuant to Article 6 of the Paris Agreement, and its reporting of a corresponding adjustment to the UNFCCC are reflected in the credits being labelled as “CORSIA Eligible” on ART’s public registry.
The release also noted that while several countries have announced their intention to trade internationally transferred mitigation outcomes (ITMOs) pursuant to Article 6.2 of the Paris Agreement, Guyana has authorized the international transfer of emission reduction credits and is the first to report a corresponding adjustment to the UNFCCC. This, it was explained, is the official UN process to prevent “double counting”, a situation where a single greenhouse gas emission reduction or removal credit is used more than once to demonstrate compliance with international mitigation targets, such as Paris Agreement NDC or airlines’ obligations under CORSIA. Guyana’s completion of this process models a path forward for other governments using the rules that have been agreed upon to date.
Broad range
According to the release, Guyana’s 2021 vintage TREES credits are available for a broad range of uses. Host country letters of authorization and corresponding adjustments are required for transactions of post-2020 vintage credits for uses specified under Article 6 of the Paris Agreement, including for transfers for use towards meeting Nationally Determined Contri-butions (NDCs), as well as for use by airlines towards CORSIA targets. The credits are also available for use toward voluntary corporate climate commitments, where corres-ponding adjustments are not required, but may be desired by some buyers.
Executive Director of ART, Mary Grady, further explained. “ART was established to unlock finance at scale for countries that successfully protect and restore their forests. We are very pleased to have worked with the Government of Guyana to help navigate the Paris Agreement and ICAO processes and achieve the issuance of the first post-2020 CORSIA eligible credits in the market.”
ART’s Board-approved issuance of TREES credits for 2021 is Guyana’s second, following those from the 2016-2020 crediting period. The independent validation and verification process for the 2021 monitoring period was conducted by Aster Global Environmental Services, Inc., an internationally accredited environmental services company, which audited Guyana’s REDD+ results for conformance with both the car-bon accounting requirements and the rigorous social and environmental safeguards of TREES.
Meanwhile, Chair of the ART Advisory Board of Directors, John Verdieck, congratulated Guyana on its achievement. “The ART Board congratulates Guyana on its leadership and huge amounts of hard work to get to this exciting point. We must protect the world’s remaining intact forests if we are to achieve global climate goals and by working at a country-wide level, we can truly achieve the scale needed. We hope this encourages other countries to follow Guyana’s lead.”
Guyana’s Vice President Bharrat Jagdeo, spoke of his country’s vision for a low-carbon economy.
“Guyana’s CORSIA-eligible issuance marks the latest milestone in a journey that we began in 2009 when we set out a vision for forging a low carbon economy in Guyana – while also building a model for the world on how tropical forests can be maintained. The ART-TREES standard, recognized by ICAO, provided the basis to build the bridge needed between forest countries’ work within the United Nations REDD+ frame-work and private sector buyers. Its integrity and conservativism assure buyers of scientific rigor, as well as independent verifi-cation that social and environ-mental safeguards are being followed.”
The assigning of forested areas on Amerindian lands for carbon credits has evoked controversy over the argument that the individual communities have not given their consent. This was the point made when
Hess Corporation, one of the partners in Guyana’s lucrative offshore oil block, on December 2, 20202 announced the purchase of US$750m of this country’s carbon credits over 10 years.
The Hess purchase followed an announcement by the Archi-tecture for REDD+ Transactions (ART) of the issuance of over 33 million carbon credits to this country. Hess purchased the first 30 per cent of that amount for a minimum of US$750 million over a ten-year period.
