COMPANY NEWS, INSIGHTS

Rightsizing carbon credits: addressing the over-crediting problem

Tuesday, 19 Sep 2023

There are a number of carbon credits available on the market that make an impact yet don’t fully deliver on the 1 tonne of CO2 avoided or removed that they promise. Carbon credit buyers could confidently use these credits if they had greater purview into their impact and adjusted their claims accordingly. Calyx Global’s Adjusted Portfolio Ratings addresses this problem by quantifying the “over-crediting” risk in credits and then identifying the number of additional credits necessary to compensate for that risk – helping organizations assemble a risk-mitigated portfolio. The risk-mitigated portfolio then receives an overall Calyx Global rating that recognizes the adjusted risk. Through Adjusted Portfolio Ratings, marketplaces and other resellers can provide high-value, risk mitigated bundles that they, and their customers, can be confident in.

What goes into an Adjusted Portfolio Rating

We have four requirements for a carbon credit to be considered for an Adjusted Portfolio Rating. These requirements ensure quality while creating transparency in hopes of more broadly elevating quality in the Voluntary Carbon Market. Find the details of the requirements in the Rightsizing Carbon Credits paper.

Who builds the portfolio

Calyx Global works with marketplaces and resellers to quantify the risk and amount of additional credits necessary to complete the portfolio but does not buy or sell credits. Once the carbon credits are acquired by the portfolio holder, Calyx Global then rates the resulting bundle. We’ve also worked with corporate sustainability teams to help them assemble similar portfolios.

oneshot.earth has assembled a risk mitigated bundle that received an A+ rating

Currently, oneshot.earth’s “High GWP Bundle” sold on Net Zero Marketplace contains three projects. They followed our four requirements required to receive the Calyx Global rating and are focused on further tackling issues with existing credits. oneshot.earth’s goal to develop the highest quality portfolio possible was notable. More on their approach can be found in the Rightsizing Carbon Credits paper.

To learn more about our Adjusted Portfolio Ratings, download Rightsizing Carbon Credits. If you’re a carbon marketplace, reseller or corporate carbon credit buyer interested in discussing Adjusted Portfolio Ratings, reach out.

About the author

Calyx Global

This article includes insights and input from multiple experts in Calyx Global.