Essential principles
Essential principles
Essential principles
for high-quality carbon dioxide removal
for high-quality carbon dioxide removal
for high-quality carbon dioxide removal
The following common set of shared principles are intended to help characterize high-quality CDR projects. Note that we distinguish between criteria that “must” or “should” be considered during project development and implementation. We use these terms to differentiate between minimum viable project characteristics (must) versus ideal project characteristics (should). These principles are not exhaustive but are intended to describe key considerations across all CDR pathways.
Read more
The following common set of shared principles are intended to help characterize high-quality CDR projects. Note that we distinguish between criteria that “must” or “should” be considered during project development and implementation. We use these terms to differentiate between minimum viable project characteristics (must) versus ideal project characteristics (should). These principles are not exhaustive but are intended to describe key considerations across all CDR pathways.
Read more
The following common set of shared principles are intended to help characterize high-quality CDR projects. Note that we distinguish between criteria that “must” or “should” be considered during project development and implementation. We use these terms to differentiate between minimum viable project characteristics (must) versus ideal project characteristics (should). These principles are not exhaustive but are intended to describe key considerations across all CDR pathways.
Read more
Essential principles
Social harms, benefits, and environmental justice
High-quality CDR projects contain strong elements of harm prevention, harm reduction, and meaningful benefits distribution. High-quality CDR projects prevent new social harms to people and communities and support a reduction in existing harms. Because concerns vary by CDR pathway and project, the harms that follow are not exhaustive, but are intended to describe some of the common and potentially negative impacts across all CDR pathways. Beyond preventing and reducing harm, high-quality CDR projects can provide additional social benefits to local communities by advancing environmental justice, building climate resilience, and supporting livelihoods.
Environmental justice focuses on improvements in the material conditions of frontline communities who experience disproportionate pollution exposure and other environmental burdens. This includes the equitable distribution of environmental benefits and harms resulting from CDR project development, implementation, and ongoing measurement, monitoring, reporting, and validation. Environmentally-just CDR projects facilitate meaningful participation and collaboration with local communities throughout the project life cycle. It is important that community involvement is equitable, inclusive, accessible, and centers perspectives from vulnerable or marginalized communities. This collaboration and shared project leadership starts by acknowledging past and present harms to frontline communities.
Social and environmental harms and benefits are closely interwoven. Harms and benefits that primarily impact ecosystems are discussed under the Environmental harms and benefits section.
Project developers must
Document evidence of a low risk of community health impacts and implement a strategy for monitoring, disclosing, and mitigating any such health risks.
Adhere to any country, state, and/or local protocols of community consultation near the project area in the early stages of project development (e.g., Free, Prior, and Informed Consent, State of California Tribal Consultation Laws, Government of Canada Public Consultations, etc.).
Comply with any country, state, or local laws related to benefit-sharing agreements with local communities.
Ensure that the project does not exacerbate or contribute new negative impacts on proximate and marginalized communities and provide a monitoring and mitigation strategy.
Guarantee that communities within and proximate to the project area will not be displaced, either through physical displacement or income-generating activity displacement (e.g., agricultural practices).
Document ongoing direct and transparent engagement with local communities, including Indigenous peoples if present, throughout the project lifetime. This should include outlining pathways for integrating community needs/input across project phases through “involvement,” as defined by the Movement Strategy Center's Spectrum of Community Engagement for evaluating procedural equity.
Avoid developing, disturbing, or restricting access to land legally designated as culturally sensitive and provide a mitigation plan for lands that communities and local stakeholders have identified as culturally and ecologically significant and that may be impacted by project activities.
Explicitly describe worker compensation in project proposals, detail how this compensation fits within the microeconomics of the region (e.g., whether wages are meaningfully above poverty wages), and ensure workers receive a living wage for that region.
Explicitly describe any worker-related health and safety impacts and provide best-in-practice training and reporting channels.
Project developers should
Engage with local communities at the level of “collaboration” as defined by the Movement Strategy Center's Spectrum of Community Engagement.
Promote long-term sustainable livelihoods and economic opportunities for local communities. This can include providing additional non-monetary benefits, such as training and education opportunities, improvements to local facilities, and access to the voluntary carbon market.
Ensure that any social benefits the project claims are being tracked using appropriate indicators in the monitoring plan. Provide robust evidence to support any claims of social benefits resulting from the project.
Clearly articulate distributive equity of project benefits to ensure underserved, marginalized, and vulnerable populations are involved, economically empowered, and generating wealth during the lifetime of the project.
Make and report progress on public carbon reduction targets and clean energy transition commitments.
Delineate the percentage of project revenues or profits paid to community members, land owners, and other local partners; the form of these payments (e.g., cash payments, in-kind payments, or funding for community services); and the timing of these payments.
Design projects with community-centered approaches that do not restrict the current use of or access to land and, where possible, that increase use or access over the course of the project lifetime.
Social harms, benefits, and environmental justice
Essential principles
High-quality CDR projects contain strong elements of harm prevention, harm reduction, and meaningful benefits distribution. High-quality CDR projects prevent new social harms to people and communities and support a reduction in existing harms. Because concerns vary by CDR pathway and project, the harms that follow are not exhaustive, but are intended to describe some of the common and potentially negative impacts across all CDR pathways. Beyond preventing and reducing harm, high-quality CDR projects can provide additional social benefits to local communities by advancing environmental justice, building climate resilience, and supporting livelihoods.
Environmental justice focuses on improvements in the material conditions of frontline communities who experience disproportionate pollution exposure and other environmental burdens. This includes the equitable distribution of environmental benefits and harms resulting from CDR project development, implementation, and ongoing measurement, monitoring, reporting, and validation. Environmentally-just CDR projects facilitate meaningful participation and collaboration with local communities throughout the project life cycle. It is important that community involvement is equitable, inclusive, accessible, and centers perspectives from vulnerable or marginalized communities. This collaboration and shared project leadership starts by acknowledging past and present harms to frontline communities.
Social and environmental harms and benefits are closely interwoven. Harms and benefits that primarily impact ecosystems are discussed under the Environmental harms and benefits section.
Project developers must
Document evidence of a low risk of community health impacts and implement a strategy for monitoring, disclosing, and mitigating any such health risks.
Adhere to any country, state, and/or local protocols of community consultation near the project area in the early stages of project development (e.g., Free, Prior, and Informed Consent, State of California Tribal Consultation Laws, Government of Canada Public Consultations, etc.).
Comply with any country, state, or local laws related to benefit-sharing agreements with local communities.
Ensure that the project does not exacerbate or contribute new negative impacts on proximate and marginalized communities and provide a monitoring and mitigation strategy.
Guarantee that communities within and proximate to the project area will not be displaced, either through physical displacement or income-generating activity displacement (e.g., agricultural practices).
Document ongoing direct and transparent engagement with local communities, including Indigenous peoples if present, throughout the project lifetime. This should include outlining pathways for integrating community needs/input across project phases through “involvement,” as defined by the Movement Strategy Center's Spectrum of Community Engagement for evaluating procedural equity.
Avoid developing, disturbing, or restricting access to land legally designated as culturally sensitive and provide a mitigation plan for lands that communities and local stakeholders have identified as culturally and ecologically significant and that may be impacted by project activities.
Explicitly describe worker compensation in project proposals, detail how this compensation fits within the microeconomics of the region (e.g., whether wages are meaningfully above poverty wages), and ensure workers receive a living wage for that region.
Explicitly describe any worker-related health and safety impacts and provide best-in-practice training and reporting channels.
Project developers should
Engage with local communities at the level of “collaboration” as defined by the Movement Strategy Center's Spectrum of Community Engagement.
Promote long-term sustainable livelihoods and economic opportunities for local communities. This can include providing additional non-monetary benefits, such as training and education opportunities, improvements to local facilities, and access to the voluntary carbon market.
Ensure that any social benefits the project claims are being tracked using appropriate indicators in the monitoring plan. Provide robust evidence to support any claims of social benefits resulting from the project.
Clearly articulate distributive equity of project benefits to ensure underserved, marginalized, and vulnerable populations are involved, economically empowered, and generating wealth during the lifetime of the project.
Make and report progress on public carbon reduction targets and clean energy transition commitments.
Delineate the percentage of project revenues or profits paid to community members, land owners, and other local partners; the form of these payments (e.g., cash payments, in-kind payments, or funding for community services); and the timing of these payments.
Design projects with community-centered approaches that do not restrict the current use of or access to land and, where possible, that increase use or access over the course of the project lifetime.
Social harms, benefits, and environmental justice
Essential principles
High-quality CDR projects contain strong elements of harm prevention, harm reduction, and meaningful benefits distribution. High-quality CDR projects prevent new social harms to people and communities and support a reduction in existing harms. Because concerns vary by CDR pathway and project, the harms that follow are not exhaustive, but are intended to describe some of the common and potentially negative impacts across all CDR pathways. Beyond preventing and reducing harm, high-quality CDR projects can provide additional social benefits to local communities by advancing environmental justice, building climate resilience, and supporting livelihoods.
Environmental justice focuses on improvements in the material conditions of frontline communities who experience disproportionate pollution exposure and other environmental burdens. This includes the equitable distribution of environmental benefits and harms resulting from CDR project development, implementation, and ongoing measurement, monitoring, reporting, and validation. Environmentally-just CDR projects facilitate meaningful participation and collaboration with local communities throughout the project life cycle. It is important that community involvement is equitable, inclusive, accessible, and centers perspectives from vulnerable or marginalized communities. This collaboration and shared project leadership starts by acknowledging past and present harms to frontline communities.
Social and environmental harms and benefits are closely interwoven. Harms and benefits that primarily impact ecosystems are discussed under the Environmental harms and benefits section.
Project developers must
Document evidence of a low risk of community health impacts and implement a strategy for monitoring, disclosing, and mitigating any such health risks.
Adhere to any country, state, and/or local protocols of community consultation near the project area in the early stages of project development (e.g., Free, Prior, and Informed Consent, State of California Tribal Consultation Laws, Government of Canada Public Consultations, etc.).
Comply with any country, state, or local laws related to benefit-sharing agreements with local communities.
Ensure that the project does not exacerbate or contribute new negative impacts on proximate and marginalized communities and provide a monitoring and mitigation strategy.
Guarantee that communities within and proximate to the project area will not be displaced, either through physical displacement or income-generating activity displacement (e.g., agricultural practices).
Document ongoing direct and transparent engagement with local communities, including Indigenous peoples if present, throughout the project lifetime. This should include outlining pathways for integrating community needs/input across project phases through “involvement,” as defined by the Movement Strategy Center's Spectrum of Community Engagement for evaluating procedural equity.
Avoid developing, disturbing, or restricting access to land legally designated as culturally sensitive and provide a mitigation plan for lands that communities and local stakeholders have identified as culturally and ecologically significant and that may be impacted by project activities.
Explicitly describe worker compensation in project proposals, detail how this compensation fits within the microeconomics of the region (e.g., whether wages are meaningfully above poverty wages), and ensure workers receive a living wage for that region.
Explicitly describe any worker-related health and safety impacts and provide best-in-practice training and reporting channels.
Project developers should
Engage with local communities at the level of “collaboration” as defined by the Movement Strategy Center's Spectrum of Community Engagement.
Promote long-term sustainable livelihoods and economic opportunities for local communities. This can include providing additional non-monetary benefits, such as training and education opportunities, improvements to local facilities, and access to the voluntary carbon market.
Ensure that any social benefits the project claims are being tracked using appropriate indicators in the monitoring plan. Provide robust evidence to support any claims of social benefits resulting from the project.
Clearly articulate distributive equity of project benefits to ensure underserved, marginalized, and vulnerable populations are involved, economically empowered, and generating wealth during the lifetime of the project.
Make and report progress on public carbon reduction targets and clean energy transition commitments.
Delineate the percentage of project revenues or profits paid to community members, land owners, and other local partners; the form of these payments (e.g., cash payments, in-kind payments, or funding for community services); and the timing of these payments.
Design projects with community-centered approaches that do not restrict the current use of or access to land and, where possible, that increase use or access over the course of the project lifetime.
Social harms, benefits, and environmental justice
Essential principles
High-quality CDR projects contain strong elements of harm prevention, harm reduction, and meaningful benefits distribution. High-quality CDR projects prevent new social harms to people and communities and support a reduction in existing harms. Because concerns vary by CDR pathway and project, the harms that follow are not exhaustive, but are intended to describe some of the common and potentially negative impacts across all CDR pathways. Beyond preventing and reducing harm, high-quality CDR projects can provide additional social benefits to local communities by advancing environmental justice, building climate resilience, and supporting livelihoods.
Environmental justice focuses on improvements in the material conditions of frontline communities who experience disproportionate pollution exposure and other environmental burdens. This includes the equitable distribution of environmental benefits and harms resulting from CDR project development, implementation, and ongoing measurement, monitoring, reporting, and validation. Environmentally-just CDR projects facilitate meaningful participation and collaboration with local communities throughout the project life cycle. It is important that community involvement is equitable, inclusive, accessible, and centers perspectives from vulnerable or marginalized communities. This collaboration and shared project leadership starts by acknowledging past and present harms to frontline communities.
Social and environmental harms and benefits are closely interwoven. Harms and benefits that primarily impact ecosystems are discussed under the Environmental harms and benefits section.
Project developers must
Document evidence of a low risk of community health impacts and implement a strategy for monitoring, disclosing, and mitigating any such health risks.
Adhere to any country, state, and/or local protocols of community consultation near the project area in the early stages of project development (e.g., Free, Prior, and Informed Consent, State of California Tribal Consultation Laws, Government of Canada Public Consultations, etc.).
Comply with any country, state, or local laws related to benefit-sharing agreements with local communities.
Ensure that the project does not exacerbate or contribute new negative impacts on proximate and marginalized communities and provide a monitoring and mitigation strategy.
Guarantee that communities within and proximate to the project area will not be displaced, either through physical displacement or income-generating activity displacement (e.g., agricultural practices).
Document ongoing direct and transparent engagement with local communities, including Indigenous peoples if present, throughout the project lifetime. This should include outlining pathways for integrating community needs/input across project phases through “involvement,” as defined by the Movement Strategy Center's Spectrum of Community Engagement for evaluating procedural equity.
Avoid developing, disturbing, or restricting access to land legally designated as culturally sensitive and provide a mitigation plan for lands that communities and local stakeholders have identified as culturally and ecologically significant and that may be impacted by project activities.
Explicitly describe worker compensation in project proposals, detail how this compensation fits within the microeconomics of the region (e.g., whether wages are meaningfully above poverty wages), and ensure workers receive a living wage for that region.
Explicitly describe any worker-related health and safety impacts and provide best-in-practice training and reporting channels.
Project developers should
Engage with local communities at the level of “collaboration” as defined by the Movement Strategy Center's Spectrum of Community Engagement.
Promote long-term sustainable livelihoods and economic opportunities for local communities. This can include providing additional non-monetary benefits, such as training and education opportunities, improvements to local facilities, and access to the voluntary carbon market.
Ensure that any social benefits the project claims are being tracked using appropriate indicators in the monitoring plan. Provide robust evidence to support any claims of social benefits resulting from the project.
Clearly articulate distributive equity of project benefits to ensure underserved, marginalized, and vulnerable populations are involved, economically empowered, and generating wealth during the lifetime of the project.
Make and report progress on public carbon reduction targets and clean energy transition commitments.
Delineate the percentage of project revenues or profits paid to community members, land owners, and other local partners; the form of these payments (e.g., cash payments, in-kind payments, or funding for community services); and the timing of these payments.
Design projects with community-centered approaches that do not restrict the current use of or access to land and, where possible, that increase use or access over the course of the project lifetime.
Essential principles
Environmental harms and benefits
Environmental harm is defined as any impact on the environment as a result of human activity that has the effect of degrading the environment, whether temporarily or permanently. Minimizing environmental harms involves preventing and mitigating negative impacts on environmental systems. Common classes of harms seen across CDR project types include release of pollutants into air, soil, and water, thermal pollution, disruption of nutrient cycling, introduction of invasive species, and habitat fragmentation. Because concerns vary by CDR pathway and context, the harms that follow are not exhaustive, but are intended to describe some of the common and potentially negative impacts across all CDR pathways. In addition to preventing and mitigating harms, high-quality projects should strive to promote environmental benefits by enhancing ecosystem services and underlying ecological and environmental functions, such as maintaining or increasing biodiversity.
Social and environmental harms and benefits are closely interwoven. Harms and benefits that primarily impact communities and people are discussed under the Social harms, benefits, and environmental justice section. Impacts that have a significant bearing on both ecosystems and communities are addressed in both sections.
Project developers must
Obtain all required legal permits and operating permissions from the appropriate local, state/providence, and federal authorities.
Assess and document the likelihood and severity of project activities that may negatively impact surrounding ecosystems (e.g., soil health, biodiversity, and water resources).
Document a plan to monitor potential harms from acute impacts, such as fires and spills, and from chronic or accumulated impacts, such as land-use change or ongoing pollutant discharge.
Transparently report any use of toxic and/or persistent environmental pollutants, including agrochemicals, and the risk of their release into the environment.
Implement and document a comprehensive mitigation strategy and remediation plan for identified negative impacts resulting from project activities.
Regularly inform the local community of identified environmental risks along with plans to monitor and mitigate them.
Implement supply chain strategies that seek to minimize or mitigate air, water, and land impacts, including waste handling and disposal activities associated with the project.
Avoid using industrial chemicals and pesticides banned in the United States or the European Union (regardless of project geography) unless a comprehensive, public risk management plan accompanies the proposed chemical’s use in the project.
Project developers should
Implement a strategy for promoting ecosystem services, such as clean air, water, or habitat restoration, and the ecological and environmental functions that underpin them.
Implement a plan for monitoring and reporting against targeted benefits.
Prioritize partnering with local organizations and industries to reduce emissions and environmental risks associated with long supply chains.
Document robust evidence for claims of environmental benefits resulting from the project.
Environmental harms and benefits
Essential principles
Environmental harm is defined as any impact on the environment as a result of human activity that has the effect of degrading the environment, whether temporarily or permanently. Minimizing environmental harms involves preventing and mitigating negative impacts on environmental systems. Common classes of harms seen across CDR project types include release of pollutants into air, soil, and water, thermal pollution, disruption of nutrient cycling, introduction of invasive species, and habitat fragmentation. Because concerns vary by CDR pathway and context, the harms that follow are not exhaustive, but are intended to describe some of the common and potentially negative impacts across all CDR pathways. In addition to preventing and mitigating harms, high-quality projects should strive to promote environmental benefits by enhancing ecosystem services and underlying ecological and environmental functions, such as maintaining or increasing biodiversity.
Social and environmental harms and benefits are closely interwoven. Harms and benefits that primarily impact communities and people are discussed under the Social harms, benefits, and environmental justice section. Impacts that have a significant bearing on both ecosystems and communities are addressed in both sections.
Project developers must
Obtain all required legal permits and operating permissions from the appropriate local, state/providence, and federal authorities.
Assess and document the likelihood and severity of project activities that may negatively impact surrounding ecosystems (e.g., soil health, biodiversity, and water resources).
Document a plan to monitor potential harms from acute impacts, such as fires and spills, and from chronic or accumulated impacts, such as land-use change or ongoing pollutant discharge.
Transparently report any use of toxic and/or persistent environmental pollutants, including agrochemicals, and the risk of their release into the environment.
Implement and document a comprehensive mitigation strategy and remediation plan for identified negative impacts resulting from project activities.
Regularly inform the local community of identified environmental risks along with plans to monitor and mitigate them.
Implement supply chain strategies that seek to minimize or mitigate air, water, and land impacts, including waste handling and disposal activities associated with the project.
Avoid using industrial chemicals and pesticides banned in the United States or the European Union (regardless of project geography) unless a comprehensive, public risk management plan accompanies the proposed chemical’s use in the project.
Project developers should
Implement a strategy for promoting ecosystem services, such as clean air, water, or habitat restoration, and the ecological and environmental functions that underpin them.
Implement a plan for monitoring and reporting against targeted benefits.
Prioritize partnering with local organizations and industries to reduce emissions and environmental risks associated with long supply chains.
Document robust evidence for claims of environmental benefits resulting from the project.
Environmental harms and benefits
Essential principles
Environmental harm is defined as any impact on the environment as a result of human activity that has the effect of degrading the environment, whether temporarily or permanently. Minimizing environmental harms involves preventing and mitigating negative impacts on environmental systems. Common classes of harms seen across CDR project types include release of pollutants into air, soil, and water, thermal pollution, disruption of nutrient cycling, introduction of invasive species, and habitat fragmentation. Because concerns vary by CDR pathway and context, the harms that follow are not exhaustive, but are intended to describe some of the common and potentially negative impacts across all CDR pathways. In addition to preventing and mitigating harms, high-quality projects should strive to promote environmental benefits by enhancing ecosystem services and underlying ecological and environmental functions, such as maintaining or increasing biodiversity.
Social and environmental harms and benefits are closely interwoven. Harms and benefits that primarily impact communities and people are discussed under the Social harms, benefits, and environmental justice section. Impacts that have a significant bearing on both ecosystems and communities are addressed in both sections.
Project developers must
Obtain all required legal permits and operating permissions from the appropriate local, state/providence, and federal authorities.
Assess and document the likelihood and severity of project activities that may negatively impact surrounding ecosystems (e.g., soil health, biodiversity, and water resources).
Document a plan to monitor potential harms from acute impacts, such as fires and spills, and from chronic or accumulated impacts, such as land-use change or ongoing pollutant discharge.
Transparently report any use of toxic and/or persistent environmental pollutants, including agrochemicals, and the risk of their release into the environment.
Implement and document a comprehensive mitigation strategy and remediation plan for identified negative impacts resulting from project activities.
Regularly inform the local community of identified environmental risks along with plans to monitor and mitigate them.
Implement supply chain strategies that seek to minimize or mitigate air, water, and land impacts, including waste handling and disposal activities associated with the project.
Avoid using industrial chemicals and pesticides banned in the United States or the European Union (regardless of project geography) unless a comprehensive, public risk management plan accompanies the proposed chemical’s use in the project.
Project developers should
Implement a strategy for promoting ecosystem services, such as clean air, water, or habitat restoration, and the ecological and environmental functions that underpin them.
Implement a plan for monitoring and reporting against targeted benefits.
Prioritize partnering with local organizations and industries to reduce emissions and environmental risks associated with long supply chains.
Document robust evidence for claims of environmental benefits resulting from the project.
Environmental harms and benefits
Essential principles
Environmental harm is defined as any impact on the environment as a result of human activity that has the effect of degrading the environment, whether temporarily or permanently. Minimizing environmental harms involves preventing and mitigating negative impacts on environmental systems. Common classes of harms seen across CDR project types include release of pollutants into air, soil, and water, thermal pollution, disruption of nutrient cycling, introduction of invasive species, and habitat fragmentation. Because concerns vary by CDR pathway and context, the harms that follow are not exhaustive, but are intended to describe some of the common and potentially negative impacts across all CDR pathways. In addition to preventing and mitigating harms, high-quality projects should strive to promote environmental benefits by enhancing ecosystem services and underlying ecological and environmental functions, such as maintaining or increasing biodiversity.
Social and environmental harms and benefits are closely interwoven. Harms and benefits that primarily impact communities and people are discussed under the Social harms, benefits, and environmental justice section. Impacts that have a significant bearing on both ecosystems and communities are addressed in both sections.
Project developers must
Obtain all required legal permits and operating permissions from the appropriate local, state/providence, and federal authorities.
Assess and document the likelihood and severity of project activities that may negatively impact surrounding ecosystems (e.g., soil health, biodiversity, and water resources).
Document a plan to monitor potential harms from acute impacts, such as fires and spills, and from chronic or accumulated impacts, such as land-use change or ongoing pollutant discharge.
Transparently report any use of toxic and/or persistent environmental pollutants, including agrochemicals, and the risk of their release into the environment.
Implement and document a comprehensive mitigation strategy and remediation plan for identified negative impacts resulting from project activities.
Regularly inform the local community of identified environmental risks along with plans to monitor and mitigate them.
Implement supply chain strategies that seek to minimize or mitigate air, water, and land impacts, including waste handling and disposal activities associated with the project.
Avoid using industrial chemicals and pesticides banned in the United States or the European Union (regardless of project geography) unless a comprehensive, public risk management plan accompanies the proposed chemical’s use in the project.
Project developers should
Implement a strategy for promoting ecosystem services, such as clean air, water, or habitat restoration, and the ecological and environmental functions that underpin them.
Implement a plan for monitoring and reporting against targeted benefits.
Prioritize partnering with local organizations and industries to reduce emissions and environmental risks associated with long supply chains.
Document robust evidence for claims of environmental benefits resulting from the project.
Essential principles
Additionality and baselines
Removal credits are additional if they would not have occurred without carbon finance. The baseline of a project is a conservative estimate of the carbon and other GHG impacts that would have occurred without carbon finance (the “counterfactual”).
Project developers must
Show that they require carbon finance to implement the project. When multiple finance streams support a project, projects are considered additional if revenue from the sale of carbon credits is required to initiate project activities.
Show that the project is not required by existing laws, regulations, or other binding obligations. If current laws or regulations mandate the project’s proposed activities, but are not being actively enforced, projects should provide justification for why enforcement is not expected to happen during the project’s crediting period.
Show that project activities are not common practice in the absence of financial or regulatory incentives.
Quantify the removals the project claims relative to the most scientifically-, economically-, and legally-plausible baseline for carbon stocks and flows (i.e., the counterfactual in the absence of carbon finance).
Baselines must account for both recent and projected changes in carbon and other GHG stocks and flows.
Baselines must be conservative, project specific, and site specific.
Project developers should
Provide full project financial information to demonstrate financial additionality (including any state support), particularly where multiple revenue streams are present.
Conduct a sensitivity analysis on the key project cost variables to determine how they impact CDR credit costs.
Document a rationale for the assumptions the project developer used for cost of debt and cost of equity when assessing project viability.
Identify and report any potential conflicts or overlap between project activities and national or subnational policies for climate mitigation, such as Nationally Determined Contributions to the Paris Agreement.
Ensure that all credits retired outside the host country are accompanied by a Letter of Authorization from the host government, explicitly confirming that the transfer is approved and that corresponding adjustments will be applied to the host country’s national inventory.
Additionality and baselines
Essential principles
Removal credits are additional if they would not have occurred without carbon finance. The baseline of a project is a conservative estimate of the carbon and other GHG impacts that would have occurred without carbon finance (the “counterfactual”).
Project developers must
Show that they require carbon finance to implement the project. When multiple finance streams support a project, projects are considered additional if revenue from the sale of carbon credits is required to initiate project activities.
Show that the project is not required by existing laws, regulations, or other binding obligations. If current laws or regulations mandate the project’s proposed activities, but are not being actively enforced, projects should provide justification for why enforcement is not expected to happen during the project’s crediting period.
Show that project activities are not common practice in the absence of financial or regulatory incentives.
Quantify the removals the project claims relative to the most scientifically-, economically-, and legally-plausible baseline for carbon stocks and flows (i.e., the counterfactual in the absence of carbon finance).
Baselines must account for both recent and projected changes in carbon and other GHG stocks and flows.
Baselines must be conservative, project specific, and site specific.
Project developers should
Provide full project financial information to demonstrate financial additionality (including any state support), particularly where multiple revenue streams are present.
Conduct a sensitivity analysis on the key project cost variables to determine how they impact CDR credit costs.
Document a rationale for the assumptions the project developer used for cost of debt and cost of equity when assessing project viability.
Identify and report any potential conflicts or overlap between project activities and national or subnational policies for climate mitigation, such as Nationally Determined Contributions to the Paris Agreement.
Ensure that all credits retired outside the host country are accompanied by a Letter of Authorization from the host government, explicitly confirming that the transfer is approved and that corresponding adjustments will be applied to the host country’s national inventory.
Additionality and baselines
Essential principles
Removal credits are additional if they would not have occurred without carbon finance. The baseline of a project is a conservative estimate of the carbon and other GHG impacts that would have occurred without carbon finance (the “counterfactual”).
Project developers must
Show that they require carbon finance to implement the project. When multiple finance streams support a project, projects are considered additional if revenue from the sale of carbon credits is required to initiate project activities.
Show that the project is not required by existing laws, regulations, or other binding obligations. If current laws or regulations mandate the project’s proposed activities, but are not being actively enforced, projects should provide justification for why enforcement is not expected to happen during the project’s crediting period.
Show that project activities are not common practice in the absence of financial or regulatory incentives.
Quantify the removals the project claims relative to the most scientifically-, economically-, and legally-plausible baseline for carbon stocks and flows (i.e., the counterfactual in the absence of carbon finance).
Baselines must account for both recent and projected changes in carbon and other GHG stocks and flows.
Baselines must be conservative, project specific, and site specific.
Project developers should
Provide full project financial information to demonstrate financial additionality (including any state support), particularly where multiple revenue streams are present.
Conduct a sensitivity analysis on the key project cost variables to determine how they impact CDR credit costs.
Document a rationale for the assumptions the project developer used for cost of debt and cost of equity when assessing project viability.
Identify and report any potential conflicts or overlap between project activities and national or subnational policies for climate mitigation, such as Nationally Determined Contributions to the Paris Agreement.
Ensure that all credits retired outside the host country are accompanied by a Letter of Authorization from the host government, explicitly confirming that the transfer is approved and that corresponding adjustments will be applied to the host country’s national inventory.
Additionality and baselines
Essential principles
Removal credits are additional if they would not have occurred without carbon finance. The baseline of a project is a conservative estimate of the carbon and other GHG impacts that would have occurred without carbon finance (the “counterfactual”).
Project developers must
Show that they require carbon finance to implement the project. When multiple finance streams support a project, projects are considered additional if revenue from the sale of carbon credits is required to initiate project activities.
Show that the project is not required by existing laws, regulations, or other binding obligations. If current laws or regulations mandate the project’s proposed activities, but are not being actively enforced, projects should provide justification for why enforcement is not expected to happen during the project’s crediting period.
Show that project activities are not common practice in the absence of financial or regulatory incentives.
Quantify the removals the project claims relative to the most scientifically-, economically-, and legally-plausible baseline for carbon stocks and flows (i.e., the counterfactual in the absence of carbon finance).
Baselines must account for both recent and projected changes in carbon and other GHG stocks and flows.
Baselines must be conservative, project specific, and site specific.
Project developers should
Provide full project financial information to demonstrate financial additionality (including any state support), particularly where multiple revenue streams are present.
Conduct a sensitivity analysis on the key project cost variables to determine how they impact CDR credit costs.
Document a rationale for the assumptions the project developer used for cost of debt and cost of equity when assessing project viability.
Identify and report any potential conflicts or overlap between project activities and national or subnational policies for climate mitigation, such as Nationally Determined Contributions to the Paris Agreement.
Ensure that all credits retired outside the host country are accompanied by a Letter of Authorization from the host government, explicitly confirming that the transfer is approved and that corresponding adjustments will be applied to the host country’s national inventory.
Essential principles
Measurement, monitoring, reporting, and verification
Carbon measurement, or project-level carbon accounting, reports all GHG emissions associated with a CDR project using repeatable and verifiable GHG quantification methods. In general, this requires the use of a cradle-to-grave life cycle assessment (LCA) and/or models that accurately estimate CDR, calibrated by periodic direct measurement.
Monitoring, reporting, and verification (MRV) involves developing and adhering to a plan for long-term monitoring of the project. Measurement and MRV are often closely linked. Developers should consider the interactions between these two criteria during project planning and execution.
Project developers must
Develop a credible MRV plan prior to the start of the project, designed with the requisite lifetime to establish ongoing validation of all project performance claims.
Adapt the MRV plan throughout the project by incorporating the best available science and evolving industry practices.
Use peer-reviewed and scientifically supported measurement methods to quantify the net volume of removals the project claims, and disclose the specific methods used.
Adhere to best practices (e.g., ISO standards 14040 and 14044) when preparing and submitting a project LCA, using a cradle-to-grave system boundary inclusive of the relevant MRV time window and end-of-life project activities.
Conservatively incorporate uncertainty to avoid overstating the estimated CDR from a project, both overall and by time period (e.g., annual CDR).
Design a regular cadence for LCA updates into the MRV plan, over the project lifetime, to ensure that carbon accounting remains tightly bound to project operations, data, and emerging science.
Separately quantify and report emissions removal, reductions, and other avoided emissions, and delineate by GHG type.
Use models that are calibrated and validated for the specific conditions the project will operate in, if applicable.
Specify model assumptions that cannot be calibrated or revised due to practice constraints, if applicable. Developers should periodically review MRV measurements and other scientific advancements to revise all other assumptions.
Avoid double issuance and double use of credits by following best-in-class carbon accounting guidelines, including allocating GHGs at the project level.
Ensure that the project’s MRV plan is or will be certified or endorsed by a third party (e.g., via a registry).
Project developers should
Use regionally appropriate sampling and data collection methods to quantify emissions and removals associated with a project, instead of using solely model-based or statistical methods.
Obtain third-party verification of calculated net removal volumes (e.g., via a registry).
Directly measure carbon removed and stored throughout the duration of the project, to the maximum practical extent possible.Store this data in a shared repository or facilitate data access to advance MRV for CDR projects and accelerate CDR market development.
Contribute data and/or project learnings to advance the development and improvement of robust global datasets and models.
Measurement, monitoring, reporting, and verification
Essential principles
Carbon measurement, or project-level carbon accounting, reports all GHG emissions associated with a CDR project using repeatable and verifiable GHG quantification methods. In general, this requires the use of a cradle-to-grave life cycle assessment (LCA) and/or models that accurately estimate CDR, calibrated by periodic direct measurement.
Monitoring, reporting, and verification (MRV) involves developing and adhering to a plan for long-term monitoring of the project. Measurement and MRV are often closely linked. Developers should consider the interactions between these two criteria during project planning and execution.
Project developers must
Develop a credible MRV plan prior to the start of the project, designed with the requisite lifetime to establish ongoing validation of all project performance claims.
Adapt the MRV plan throughout the project by incorporating the best available science and evolving industry practices.
Use peer-reviewed and scientifically supported measurement methods to quantify the net volume of removals the project claims, and disclose the specific methods used.
Adhere to best practices (e.g., ISO standards 14040 and 14044) when preparing and submitting a project LCA, using a cradle-to-grave system boundary inclusive of the relevant MRV time window and end-of-life project activities.
Conservatively incorporate uncertainty to avoid overstating the estimated CDR from a project, both overall and by time period (e.g., annual CDR).
Design a regular cadence for LCA updates into the MRV plan, over the project lifetime, to ensure that carbon accounting remains tightly bound to project operations, data, and emerging science.
Separately quantify and report emissions removal, reductions, and other avoided emissions, and delineate by GHG type.
Use models that are calibrated and validated for the specific conditions the project will operate in, if applicable.
Specify model assumptions that cannot be calibrated or revised due to practice constraints, if applicable. Developers should periodically review MRV measurements and other scientific advancements to revise all other assumptions.
Avoid double issuance and double use of credits by following best-in-class carbon accounting guidelines, including allocating GHGs at the project level.
Ensure that the project’s MRV plan is or will be certified or endorsed by a third party (e.g., via a registry).
Project developers should
Use regionally appropriate sampling and data collection methods to quantify emissions and removals associated with a project, instead of using solely model-based or statistical methods.
Obtain third-party verification of calculated net removal volumes (e.g., via a registry).
Directly measure carbon removed and stored throughout the duration of the project, to the maximum practical extent possible. Store this data in a shared repository or facilitate data access to advance MRV for CDR projects and accelerate CDR market development.
Contribute data and/or project learnings to advance the development and improvement of robust global datasets and models.
Measurement, monitoring, reporting, and verification
Essential principles
Carbon measurement, or project-level carbon accounting, reports all GHG emissions associated with a CDR project using repeatable and verifiable GHG quantification methods. In general, this requires the use of a cradle-to-grave life cycle assessment (LCA) and/or models that accurately estimate CDR, calibrated by periodic direct measurement.
Monitoring, reporting, and verification (MRV) involves developing and adhering to a plan for long-term monitoring of the project. Measurement and MRV are often closely linked. Developers should consider the interactions between these two criteria during project planning and execution.
Project developers must
Develop a credible MRV plan prior to the start of the project, designed with the requisite lifetime to establish ongoing validation of all project performance claims.
Adapt the MRV plan throughout the project by incorporating the best available science and evolving industry practices.
Use peer-reviewed and scientifically supported measurement methods to quantify the net volume of removals the project claims, and disclose the specific methods used.
Adhere to best practices (e.g., ISO standards 14040 and 14044) when preparing and submitting a project LCA, using a cradle-to-grave system boundary inclusive of the relevant MRV time window and end-of-life project activities.
Conservatively incorporate uncertainty to avoid overstating the estimated CDR from a project, both overall and by time period (e.g., annual CDR).
Design a regular cadence for LCA updates into the MRV plan, over the project lifetime, to ensure that carbon accounting remains tightly bound to project operations, data, and emerging science.
Separately quantify and report emissions removal, reductions, and other avoided emissions, and delineate by GHG type.
Use models that are calibrated and validated for the specific conditions the project will operate in, if applicable.
Specify model assumptions that cannot be calibrated or revised due to practice constraints, if applicable. Developers should periodically review MRV measurements and other scientific advancements to revise all other assumptions.
Avoid double issuance and double use of credits by following best-in-class carbon accounting guidelines, including allocating GHGs at the project level.
Ensure that the project’s MRV plan is or will be certified or endorsed by a third party (e.g., via a registry).
Project developers should
Use regionally appropriate sampling and data collection methods to quantify emissions and removals associated with a project, instead of using solely model-based or statistical methods.
Obtain third-party verification of calculated net removal volumes (e.g., via a registry).
Directly measure carbon removed and stored throughout the duration of the project, to the maximum practical extent possible. Store this data in a shared repository or facilitate data access to advance MRV for CDR projects and accelerate CDR market development.
Contribute data and/or project learnings to advance the development and improvement of robust global datasets and models.
Measurement, monitoring, reporting, and verification
Essential principles
Carbon measurement, or project-level carbon accounting, reports all GHG emissions associated with a CDR project using repeatable and verifiable GHG quantification methods. In general, this requires the use of a cradle-to-grave life cycle assessment (LCA) and/or models that accurately estimate CDR, calibrated by periodic direct measurement.
Monitoring, reporting, and verification (MRV) involves developing and adhering to a plan for long-term monitoring of the project. Measurement and MRV are often closely linked. Developers should consider the interactions between these two criteria during project planning and execution.
Project developers must
Develop a credible MRV plan prior to the start of the project, designed with the requisite lifetime to establish ongoing validation of all project performance claims.
Adapt the MRV plan throughout the project by incorporating the best available science and evolving industry practices.
Use peer-reviewed and scientifically supported measurement methods to quantify the net volume of removals the project claims, and disclose the specific methods used.
Adhere to best practices (e.g., ISO standards 14040 and 14044) when preparing and submitting a project LCA, using a cradle-to-grave system boundary inclusive of the relevant MRV time window and end-of-life project activities.
Conservatively incorporate uncertainty to avoid overstating the estimated CDR from a project, both overall and by time period (e.g., annual CDR).
Design a regular cadence for LCA updates into the MRV plan, over the project lifetime, to ensure that carbon accounting remains tightly bound to project operations, data, and emerging science.
Separately quantify and report emissions removal, reductions, and other avoided emissions, and delineate by GHG type.
Use models that are calibrated and validated for the specific conditions the project will operate in, if applicable.
Specify model assumptions that cannot be calibrated or revised due to practice constraints, if applicable. Developers should periodically review MRV measurements and other scientific advancements to revise all other assumptions.
Avoid double issuance and double use of credits by following best-in-class carbon accounting guidelines, including allocating GHGs at the project level.
Ensure that the project’s MRV plan is or will be certified or endorsed by a third party (e.g., via a registry).
Project developers should
Use regionally appropriate sampling and data collection methods to quantify emissions and removals associated with a project, instead of using solely model-based or statistical methods.
Obtain third-party verification of calculated net removal volumes (e.g., via a registry).
Directly measure carbon removed and stored throughout the duration of the project, to the maximum practical extent possible. Store this data in a shared repository or facilitate data access to advance MRV for CDR projects and accelerate CDR market development.
Contribute data and/or project learnings to advance the development and improvement of robust global datasets and models.
Essential principles
Durability
Durability is the capacity for stored carbon to withstand reversal, or reemission, to the atmosphere. We use the term “durability” because it is less absolute than “permanence” and acknowledges the temporal variability inherent to most forms of carbon storage. The durability of stored carbon is limited by both natural and anthropogenic risks of reversal, which can prematurely release carbon from storage. Reversals can be either intentional (e.g., changing management practices) or unintentional (e.g., natural disturbances). Longer and more durable storage terms are preferable (until widely accepted methods enable comparison of varied durability terms).
Project developers must
Document and substantiate the projected duration (in years) over which removed carbon will be stored using a combination of the best available science and relevant system performance metrics, both measured and modeled.
Implement an MRV plan to monitor the stored carbon, reliably detect reversal events over the monitoring period, and collect enough evidence to reliably predict the likelihood of reversal events in the post-monitoring period up to the stated durability term.
Conservatively estimate a project’s risk of reversal using the best available science, including planning for present and future climate change.
Identify who is liable for remediating the reversal of stored carbon and the length of this liability (e.g., number of years), including any intended transfer of liability.
Project developers should
Site projects in areas with a low risk of reversal and implement ongoing risk-mitigation measures to minimize the impact of future reversal events, including future risks associated with climate change.
Ensure that agreements made during project execution include measures that mitigate the risk of reversals throughout and beyond the project operational lifetime.
Rely on insurance-type products, such as a buffer pool, to address the risk of reversal and that satisfy the following criteria.
Reflect a scientifically substantiated, conservative risk of reversal, including possible increases in risks associated with climate change.
Dictate that intentional reversals must be entirely remediated, even exceeding all buffer pool contributions from the project.
Retire a project’s buffer pool credit contributions at the end of the project monitoring period.
Draw upon like-for-like CDR for compensation, wherever possible.
Durability
Essential principles
Durability is the capacity for stored carbon to withstand reversal, or reemission, to the atmosphere. We use the term “durability” because it is less absolute than “permanence” and acknowledges the temporal variability inherent to most forms of carbon storage. The durability of stored carbon is limited by both natural and anthropogenic risks of reversal, which can prematurely release carbon from storage. Reversals can be either intentional (e.g., changing management practices) or unintentional (e.g., natural disturbances). Longer and more durable storage terms are preferable (until widely accepted methods enable comparison of varied durability terms).
Project developers must
Document and substantiate the projected duration (in years) over which removed carbon will be stored using a combination of the best available science and relevant system performance metrics, both measured and modeled.
Implement an MRV plan to monitor the stored carbon, reliably detect reversal events over the monitoring period, and collect enough evidence to reliably predict the likelihood of reversal events in the post-monitoring period up to the stated durability term.
Conservatively estimate a project’s risk of reversal using the best available science, including planning for present and future climate change.
Identify who is liable for remediating the reversal of stored carbon and the length of this liability (e.g., number of years), including any intended transfer of liability.
Project developers should
Site projects in areas with a low risk of reversal and implement ongoing risk-mitigation measures to minimize the impact of future reversal events, including future risks associated with climate change.
Ensure that agreements made during project execution include measures that mitigate the risk of reversals throughout and beyond the project operational lifetime.
Rely on insurance-type products, such as a buffer pool, to address the risk of reversal and that satisfy the following criteria.
Reflect a scientifically substantiated, conservative risk of reversal, including possible increases in risks associated with climate change.
Dictate that intentional reversals must be entirely remediated, even exceeding all buffer pool contributions from the project.
Retire a project’s buffer pool credit contributions at the end of the project monitoring period.
Draw upon like-for-like CDR for compensation, wherever possible.
Durability
Essential principles
Durability is the capacity for stored carbon to withstand reversal, or reemission, to the atmosphere. We use the term “durability” because it is less absolute than “permanence” and acknowledges the temporal variability inherent to most forms of carbon storage. The durability of stored carbon is limited by both natural and anthropogenic risks of reversal, which can prematurely release carbon from storage. Reversals can be either intentional (e.g., changing management practices) or unintentional (e.g., natural disturbances). Longer and more durable storage terms are preferable (until widely accepted methods enable comparison of varied durability terms).
Project developers must
Document and substantiate the projected duration (in years) over which removed carbon will be stored using a combination of the best available science and relevant system performance metrics, both measured and modeled.
Implement an MRV plan to monitor the stored carbon, reliably detect reversal events over the monitoring period, and collect enough evidence to reliably predict the likelihood of reversal events in the post-monitoring period up to the stated durability term.
Conservatively estimate a project’s risk of reversal using the best available science, including planning for present and future climate change.
Identify who is liable for remediating the reversal of stored carbon and the length of this liability (e.g., number of years), including any intended transfer of liability.
Project developers should
Site projects in areas with a low risk of reversal and implement ongoing risk-mitigation measures to minimize the impact of future reversal events, including future risks associated with climate change.
Ensure that agreements made during project execution include measures that mitigate the risk of reversals throughout and beyond the project operational lifetime.
Rely on insurance-type products, such as a buffer pool, to address the risk of reversal and that satisfy the following criteria.
Reflect a scientifically substantiated, conservative risk of reversal, including possible increases in risks associated with climate change.
Dictate that intentional reversals must be entirely remediated, even exceeding all buffer pool contributions from the project.
Retire a project’s buffer pool credit contributions at the end of the project monitoring period.
Draw upon like-for-like CDR for compensation, wherever possible.
Durability
Essential principles
Durability is the capacity for stored carbon to withstand reversal, or reemission, to the atmosphere. We use the term “durability” because it is less absolute than “permanence” and acknowledges the temporal variability inherent to most forms of carbon storage. The durability of stored carbon is limited by both natural and anthropogenic risks of reversal, which can prematurely release carbon from storage. Reversals can be either intentional (e.g., changing management practices) or unintentional (e.g., natural disturbances). Longer and more durable storage terms are preferable (until widely accepted methods enable comparison of varied durability terms).
Project developers must
Document and substantiate the projected duration (in years) over which removed carbon will be stored using a combination of the best available science and relevant system performance metrics, both measured and modeled.
Implement an MRV plan to monitor the stored carbon, reliably detect reversal events over the monitoring period, and collect enough evidence to reliably predict the likelihood of reversal events in the post-monitoring period up to the stated durability term.
Conservatively estimate a project’s risk of reversal using the best available science, including planning for present and future climate change.
Identify who is liable for remediating the reversal of stored carbon and the length of this liability (e.g., number of years), including any intended transfer of liability.
Project developers should
Site projects in areas with a low risk of reversal and implement ongoing risk-mitigation measures to minimize the impact of future reversal events, including future risks associated with climate change.
Ensure that agreements made during project execution include measures that mitigate the risk of reversals throughout and beyond the project operational lifetime.
Rely on insurance-type products, such as a buffer pool, to address the risk of reversal and that satisfy the following criteria.
Reflect a scientifically substantiated, conservative risk of reversal, including possible increases in risks associated with climate change.
Dictate that intentional reversals must be entirely remediated, even exceeding all buffer pool contributions from the project.
Retire a project’s buffer pool credit contributions at the end of the project monitoring period.
Draw upon like-for-like CDR for compensation, wherever possible.
Essential principles
Leakage
Economic leakage (“leakage”) is the displacement of GHG emissions from the project site to another geographic location. Economic leakage typically occurs because market demand for the output of the emitting activity is unchanged, while the CDR project decreases local supply. Leakage should not be confused with physical leakage of stored CO₂, which is discussed in the Durability principle.
There are two forms of economic leakage: activity-shifting and market. Activity-shifting leakage occurs when agents operating within a project boundary shift production to outside the project boundary. Market leakage occurs when a project reduces the production of a good, and this local reduction induces increased production of that good elsewhere to meet demand. Market leakage can be very difficult to predict and measure.
Project developers must
Conservatively account for the carbon impacts of market leakage the project causes, accounting for both domestic and international leakage, or conclusively demonstrate that the project avoids any leakage.
Design projects to avoid directly inducing activity-shifting leakage, and conservatively account for any such leakage that occurs.
Document all potential sources of leakage and implement mitigation strategies to minimize unwanted leakage outcomes over the lifetime of the project.
Justify the assumptions and methods used to quantify leakage.
Project developers should
Design project activities to reduce the probability of inducing market leakage.
Leakage
Essential principles
Economic leakage (“leakage”) is the displacement of GHG emissions from the project site to another geographic location. Economic leakage typically occurs because market demand for the output of the emitting activity is unchanged, while the CDR project decreases local supply. Leakage should not be confused with physical leakage of stored CO₂, which is discussed in the Durability principle.
There are two forms of economic leakage: activity-shifting and market. Activity-shifting leakage occurs when agents operating within a project boundary shift production to outside the project boundary. Market leakage occurs when a project reduces the production of a good, and this local reduction induces increased production of that good elsewhere to meet demand. Market leakage can be very difficult to predict and measure.
Project developers must
Conservatively account for the carbon impacts of market leakage the project causes, accounting for both domestic and international leakage, or conclusively demonstrate that the project avoids any leakage.
Design projects to avoid directly inducing activity-shifting leakage, and conservatively account for any such leakage that occurs.
Document all potential sources of leakage and implement mitigation strategies to minimize unwanted leakage outcomes over the lifetime of the project.
Justify the assumptions and methods used to quantify leakage.
Project developers should
Design project activities to reduce the probability of inducing market leakage.
Leakage
Essential principles
Economic leakage (“leakage”) is the displacement of GHG emissions from the project site to another geographic location. Economic leakage typically occurs because market demand for the output of the emitting activity is unchanged, while the CDR project decreases local supply. Leakage should not be confused with physical leakage of stored CO₂, which is discussed in the Durability principle.
There are two forms of economic leakage: activity-shifting and market. Activity-shifting leakage occurs when agents operating within a project boundary shift production to outside the project boundary. Market leakage occurs when a project reduces the production of a good, and this local reduction induces increased production of that good elsewhere to meet demand. Market leakage can be very difficult to predict and measure.
Project developers must
Conservatively account for the carbon impacts of market leakage the project causes, accounting for both domestic and international leakage, or conclusively demonstrate that the project avoids any leakage.
Design projects to avoid directly inducing activity-shifting leakage, and conservatively account for any such leakage that occurs.
Document all potential sources of leakage and implement mitigation strategies to minimize unwanted leakage outcomes over the lifetime of the project.
Justify the assumptions and methods used to quantify leakage.
Project developers should
Design project activities to reduce the probability of inducing market leakage.
Leakage
Essential principles
Economic leakage (“leakage”) is the displacement of GHG emissions from the project site to another geographic location. Economic leakage typically occurs because market demand for the output of the emitting activity is unchanged, while the CDR project decreases local supply. Leakage should not be confused with physical leakage of stored CO₂, which is discussed in the Durability principle.
There are two forms of economic leakage: activity-shifting and market. Activity-shifting leakage occurs when agents operating within a project boundary shift production to outside the project boundary. Market leakage occurs when a project reduces the production of a good, and this local reduction induces increased production of that good elsewhere to meet demand. Market leakage can be very difficult to predict and measure.
Project developers must
Conservatively account for the carbon impacts of market leakage the project causes, accounting for both domestic and international leakage, or conclusively demonstrate that the project avoids any leakage.
Design projects to avoid directly inducing activity-shifting leakage, and conservatively account for any such leakage that occurs.
Document all potential sources of leakage and implement mitigation strategies to minimize unwanted leakage outcomes over the lifetime of the project.
Justify the assumptions and methods used to quantify leakage.
Project developers should
Design project activities to reduce the probability of inducing market leakage.
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