You have probably heard about the voluntary carbon market (VCM) in Colombia and have asked yourself questions such as, what is it? How does it contribute to climate action? What and how does it sell?
Below, we will shed light on this dynamic world, where new information is constantly circulating around the topic.
What is the voluntary carbon market in Colombia and what are carbon certificates?
As its name implies, the VCM is a market where commercial transactions are carried out for the purchase and sale of carbon certificates. It is called voluntary because it allows individuals and companies to acquire certificates to offset or willingly contribute to the reduction of greenhouse gas emissions.
Martin Perez, Director of Impact and Monitoring of Forest Climate Solutions at WWF US, points out that a carbon certificate is a document that certifies a certain region, sector or actor “stopped emitting a ton of carbon, or that it was captured, for example, in trees and other components of ecosystems, thanks to the implementation of actions to protect forests and jungles that are in danger of deforestation.”
According to Perez, “it is also possible to generate certificates that avoid carbon emissions associated with sectors other than land use, but it is here where welfare is maximized.” The state and VCM actors must ensure that the market operates with integrity and thus guarantee that the agreements with the communities that participate in the development of these projects are fair and equitable.
How do carbon markets contribute to climate action in Colombia?
Colombia's mitigation goal is to reduce greenhouse gas emissions by 51% by 2030. To achieve adequate emissions reduction at the national level, a strategy was designed with actions, including a carbon tax. This tax includes a mechanism called “non-causation” that aims to stimulate carbon markets, especially nature-based mitigation projects.
Likewise, the National Development Plan 2022-2026 has required that in the execution of carbon markets, social safeguards must be complied and reported. In this context, voluntary market projects have the potential to contribute to national climate goals if they are implemented within a framework of environmental and social integrity.
What role do forests play in the carbon market, and how does the carbon market reach forest regions and communities?
To understand how the market works, it is important to recognize the relevance of the ecosystems within the territories where a project will be carried out, as well as the relationship and participation between community, business and governmental actors involved in the project.
For Colombia, the Amazon and Pacific regions are important for the development of carbon projects, as they have a large percentage of conserved forests, which makes them excellent carbon sinks. However, they are currently threatened by deforestation and degradation due to activities like mining, cattle ranching and illegal logging—the carbon market is thus a valuable tool used to reverse and mitigate the adverse effects that these harmful activities inflict on the integrity and health of the forests.
The participation of the local communities that inhabit these territories and their own governing bodies—alongside their representative organizations, who through projects can access negotiations and reach agreements with private companies that manage the market—are key to the success of these markets and projects. Although agreements can be made with fair rules for all parties where the communities can thrive and flourish the most from their own projects, there have also been several examples where unfair deals and negotiations have led to harmful risks to the communities, affecting their cultural heritage, safeguards and territories.
UK PACT (Partnering for Accelerated Climate Transitions) through the British Embassy in Colombia, funded CCAP and WWF Colombia to develop the document linked above (“Fair and Equitable REDD+ Agreements: A Guide for the Amazon and the Pacific”). This guide is a tool designed to understand how REDD+ projects operate in Colombia (particularly in the Amazon and Pacific), addressing risks and opportunities pertaining to these types of forestry initiatives.
The above-mentioned document is an updated version of the original guide created by WWF Colombia for the Colombian Amazon in 2022. This updated version of the guide provides inputs, that include the Pacific region, to achieve fair and equitable agreements in the development of VCM REDD+ projects.
What is CCAP’s role in VCM REDD+ projects?
CCAP does not partake in the VCM value chain or obtain resources from the implementation of such projects. As an independent, non-profit think tank in Washington, DC, CCAP studies the state of play, including challenges, risks, needs and opportunities that carbon market and pricing instruments produce in terms of environmental integrity and local community welfare. CCAP works with multiple stakeholders and decision-makers to promote best practices for projects with an emphasis on environmental and social safeguards, as well as directly with local community organizations to support capacity and knowledge building processes and to strengthen community-based governance instruments related to REDD+ projects and the VCM.
What is WWF’s role in VCM REDD+ projects?
WWF Colombia does not participate in carbon markets or obtain resources from this type of implementation. WWF Colombia promotes the urgency of establishing parameters that guarantee the legal frameworks towards obtaining fair and equitable REDD+ agreements. Supported by community governance, fair agreements could be an arm for the safeguards framework to be implemented, expanding its scope of action from the prevention of damage to achieve the maximization of community benefits.
Fair and Equitable REDD+ Agreements is a project implemented by WWF and CCAP and supported by the British Embassy in Colombia and UK PACT (Partnering for Accelerated Climate Transitions) between 2023-2024.
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CCAP’s mission is to support every step of climate action, from ambition to implementation. A recognized world leader in climate policy and action, CCAP creates innovative, replicable climate solutions, strengthens capacities, and promotes best practices across the local, national, and international levels to accelerate the transition to a net-zero, climate resilient future. CCAP was founded in 1985 and is based in Washington, DC.