The Architecture for REDD+ Transactions (ART) Wednesday issued 7.14 million 2021 vintage carbon credits to Guyana, as Georgetown simultaneously announced the world’s first Paris Agreement corresponding adjustment, which was authorised and reported to the United Nations Framework Convention on Climate Change(UNFCCC).
“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,” said John Verdieck, chair of the ART Advisory Board of Directors.
The process fulfils 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 International Civil Aviation Organisation’s (ICAO) global emission reduction programme, CORSIA.
ICAO is a specialised agency of the United Nations that manages the standards that govern international aviation. In 2016, ICAO approved the CORSIA as a global market-based mechanism to enable airlines to offset future emissions.
ART issued the TREES credits to Guyana 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+.
Guyana has subsequently authorised the credits to be used for a range of compliance and voluntary purposes in keeping with Article 6 of the Paris Agreement.
As a result of the authorisation 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 1 January 2024.
At least 126 countries are voluntarily participating in CORSI’s first phase, covering roughly 80 per cent of annual emissions from the aviation sector. 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 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, and that ART is one of only two crediting programmes to date that has received ICAO approval to supply credits for compliance in the first phase.
Guyana’s authorization 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.
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 authorised the international transfer of emission reduction credits and is the first to report a corresponding adjustment to the UNFCCC.
This is the official UN process to prevent double counting, which describes situations 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.
“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+ framework and private sector buyers. Its integrity and conservativism assure buyers of scientific rigor, as well as independent verification that social and environmental safeguards are being followed,” said Guyana’s Vice President Bharrat Jagdeo.
Guyana’s 2021 vintage TREES credits are available for a broad range of uses. Host country letters of authorisation and corresponding adjustments are required for transactions of post-2020 vintage credits for uses specified under Article Six of the Paris Agreement.
The credits are also available for use toward voluntary corporate climate commitments, where corresponding adjustments are not required, but may be desired by some buyers.
“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,” said Mary Grady, ART executive director.
