Carbon Challenge Accepted!

November 19, 2022

Carbon Challenge Accepted!

Canada launches its carbon pricing initiative at COP27, while India reveals its long-term, net zero strategy. Switzerland and Ghana also approve the first-ever international emissions trading. 

Meanwhile, a climate tech startup BeZero Carbon secures $50 million to expand its carbon rating platform. 

It has been a busy week for nations as the COP27 summit winds down.

Canada’s Carbon Challenge

At COP27, Canada formally rolls out the Global Carbon Pricing Challenge. It’s an initiative calling on all nations to expand the use of pollution pricing in fighting climate change.

Carbon pricing works because there’s a financial incentive for emitters to pollute less; the more they pollute the air, the more it will cost them.

Will other countries accept the challenge? That’s what we should watch out for beyond COP27.  

India’s Long-Term LEDS 

India aims to reach net zero emissions by 2070 and it just unveiled its long-term strategy to the COP27 delegates, detailing how it will achieve its climate goals.

This plan is called the Long-Term Low Emissions and Development Strategies (LT-LEDS) and is submitted to the UNFCCC. 

What’s new in India’s LT-LEDS is its focus on slashing consumption at the household level and the inclusion of Carbon Capture, Use & Storage (CCUS). The strategy zeroes in on 6 key areas: electricity, urbanization, transport, forests, finance, and industry.

But same with other developing nations’ net zero targets, India needs tens of billions of climate finance to get there. 

The First-Ever “ITMO”

Article 6.2 of the Paris Agreement acknowledges that nations can enter voluntary cooperation in implementing their NDCs for more ambitious climate goals.

This creates a new carbon market mechanism known as “ITMO” - Internationally Transferred Mitigation Outcome. 

ITMO is a carbon emissions trading system where countries can buy or trade carbon credits from other countries, opening doors for new carbon markets and larger emissions reductions.

Ghana and Switzerland, along with Vanuatu, have approved the first-ever ITMO projects at COP27, while UNDP is creating a strong demand for them. And as countries begin to build their ITMO capacity, we can expect to see more of these carbon credits in the VCM.

$50M for BeZero

London-based climate tech startup BeZero Carbon secured $50 million in its Series B round. The funding will be for scaling up its carbon rating platform and expanding into the US and Asia.

The BeZero Carbon Rating (BCR) gives users a risk-based assessment for evaluating carbon credit of any type in any sector and country via a 7-point rating scale. 

That’s to ensure that the VCM grows in a transparent way and delivers a real impact on the planet, giving more confidence to buyers and investors alike. 

Carbon Fact of the Week

According to the 26th Congress of the Parties (COP26), about US$125 trillion in investment is needed to reach net zero emissions globally by 2050 and fight climate change. 

As per the 2021 report of the International Energy Agency (IEA), World Bank and World Economic Forum, over US$1 trillion per year will need to be invested in emerging carbon markets through 2030 to get them on track with net zero by 2050.

For India alone, it needs about US$2.5 trillion until 2030 for its NDCs and US$10.1 trillion to achieve net zero emissions by 2070, according to an independent report.

Source: https://carboncredits.com/