S&P Global Platts (“Platts”), the leading independent provider of information, analytics, and benchmark prices for the commodities and energy markets, commenced publishing a new suite of voluntary carbon credit assessments across a variety of project types including removal, avoidance, renewable and methane collection credits, effective August 9, 2021. This brings the total number of project types covered by Platts first to seven.
The UN’s International Panel on Climate Change (IPCC) released its latest report just Monday, August 9, showing that global heating is accelerating. The voluntary carbon markets are essential to mitigating the effects of emissions that cannot be cut. Pricing transparency in this market is important to help channel investment into projects that can make a positive difference, including projects that can permanently capture and sequester carbon from the atmosphere.
Platts CAC reflects Avoidance-based carbon credit projects and comprises individual assessments of Platts Household Devices (launched June 14), Platts Industrial Pollutants, and Platts Nature-Based Avoidance. Avoidance credits are generated by voluntary carbon credit projects that reduce the volume of emissions generated and released into the atmosphere. Common types of Avoidance projects are avoided deforestation, distribution of clean cookstoves or waste gas projects that capture methane from landfills or livestock waste.
Platts CRC reflects Removals-based carbon credit projects and comprises individual assessments of Natural Carbon Capture and Tech Carbon Capture. Removals credits are generated by projects that actively capture and sequester emissions. Like Avoidance credits, these can be created by either nature-based or technology-based projects, but they are most commonly generated by reforestation, afforestation, and soil sequestration projects.
Platts has also begun publishing independent, stand-alone assessments for Renewable Energy carbon credits and Methane Collection Carbon Credits.
Paula VanLaningham, Global Head of Carbon at S&P Global Platts said: “Our window to manage the worst effects of global heating has grown ever more narrow. Carbon markets will play a key role in the management of GHG emissions moving forward, in conjunction with heavy cuts. Lack of transparency in voluntary carbon credit markets in the past has been a hindrance to growth and hampered large-scale investment in projects. Platts’ new assessments of Avoidance-based carbon credit projects and Removals-based carbon credit projects will help bring much needed further pricing transparency to the entire market.”
Each basket will incorporate individual assessments of different types of voluntary carbon credit projects, with the most competitive price within the basket setting the benchmark price on the day. As at 12:00 GMT, Platts is publishing all new assessments for both current year delivery and delivery one year forward and in a number of different global currencies.
Platts’ new voluntary carbon credit assessments showed the range of projects and prices currently available in the market: At the low end of the assessment range, Platts Renewable Energy was assessed at $2.30/mtCO2e for Current Year Delivery, while Platts Tech Carbon Capture was assessed at $100/mtCO2e. Platts CAC was assessed at $6.68/mtCO2e for current year delivery, with Platts CRC assessed at $15/mtCO2e.
Earlier this year, S&P Global Platts launched the market’s first daily voluntary carbon credit assessments with the publication of Platts CEC, representing CORSIA-eligible carbon credits. These new assessments will sit alongside Platts CEC and Platts CNC, which reflects nature-based carbon credits.