What is a Carbon Standard?

Cool Effect
Cool Effect
Published in
6 min readOct 26, 2023

When it comes to carbon projects, we have very high standards. Every project represented by Cool Effect must first have carbon credits that have been issued by one of the major international Carbon Standards. But we are often asked, what is a carbon standard? And, how is that different from a carbon registry?

Our colleagues at Stockholm Environmental Institute provide a helpful starting point:

“The distinction between protocols, programs, standards, and registries can be confusing since the terms are loosely defined. For example, several offset programs call themselves “standards” (e.g., Verified Carbon Standard, Gold Standard) and “registries” (e.g., American Carbon Registry) though these are offset programs that have the same basic functions and components.”

In other words, a ‘carbon standard’ and a ‘carbon registry’ are often used interchangeably in conversation but technically may have different functions.

Let’s go back to how it all started. In 1997, 192 countries signed the Kyoto Protocol, making it the first global agreement by nations to combat climate change. Article 12 called for the creation of “Clean Development Mechanism” which became known as “CDM.” The mechanism was a trailblazer because it provided the first global, environmental credit scheme of its kind — a CER ( Certified Emission Reduction) which we now call “carbon credit.” Carbon projects now had a measurable way to sell their emission reductions to buyers that were required by law to offset emissions. CDM became the registry that tracked each carbon credit issued to a project and sold to the buyer who could then count the emissions reduction towards Kyoto targets.

CDM became the first carbon registry.

In 2003, World Wildlife Fund along with a broad group of NGOs launched Gold Standard. A few years later, another group of NGOs launched The Verified Carbon Standard which is now known as VERRA. This was followed by regional players such as American Carbon Registry, Climate Action Reserve and Australia Carbon Credit Unit. Each has its own system of issuing credits against methodologies and accounting for certified carbon credits. Hence, the use of “standards” and “registries.”

At their most basic level, carbon standards are simply sets of rules, regulations, reporting criteria, and methodologies used to verify that carbon reduction projects are legitimate, effective, and are delivering on the environmental and community benefits they claim to be delivering. Without carbon standards to help provide guidance on verifying the legitimacy of carbon credits, there’d be no way to effectively gauge the actual effectiveness of carbon reduction projects.

Look at it this way — you shouldn’t eat at a restaurant whose kitchen doesn’t follow food safety best practices, and you shouldn’t purchase carbon credits from providers who don’t adhere to guidelines established by the carbon standards.

But carbon standards do not necessarily have consistent protocols and methodologies. The fact that a carbon credit program uses a particular standard is the price of entry but not enough to guarantee that the carbon credit is high-quality. That’s why buyers should also utilize additional metrics to ensure what they are buying has real environmental integrity.

So now that you know what a carbon standard is, let’s dig a little deeper. There are two main types of carbon credit marketplaces to understand when talking about carbon standards: those that are compliance based, and those that are voluntary.

Compliance based markets, also known as mandatory markets, are. . .well, mandatory, in accordance with standards established by the Kyoto Protocol. Companies, organizations, and governments that are mandated to offset their emissions deal within this market. The carbon standards they follow are set and enforced in accordance with the Framework of the United Nations Convention on Climate Change (UNFCCC). Each ton of CO2 reduced here is measured in carbon credits or Certified Emission Reductions (CERs).

The voluntary market is where the majority of people come face-to-face with the world of carbon credits, so we’ll be focusing on that market, and those standards, going forward. Voluntary markets deal in Verified Emission Reductions (VERs) credits and can’t be used to reach emission reduction goals outlined under the Kyoto Protocol. Other than that, in this market, companies and individuals can acquire or purchase carbon credits directly, but the programs providing those credits must be verified by an independent third party before they become available.

As these voluntary carbon credits grew in popularity, so did the number of their critics, who attacked everything from a lack of transparency in the market to a simple lack of quality assurance for projects. As a response, over a dozen standards were developed to combat the issue. The existing standards differ in their methodologies, categories, and locations, but they all have a few things in common — namely, they demand that carbon projects must meet the following criteria to meet their standards:

  • Do not engage in double-counting, meaning that each credit is only retired once and properly registered
  • Prevent leakage, meaning they ensure that the emissions are actually being reduced through the project and not simply displaced to another geographic location
  • Adhere to accounting methods to ensure standardized recording and reporting of the project’s co-benefits
  • Ensure the project’s additionality and permanence, meaning the project would not happen without support and its net effect will remain fixed

Standards you should keep an eye out for include Verra’s Verified Carbon Standard, the Gold Standard, Climate Action Reserve, and the American Carbon Registry. If you see one or more of these standards affiliated with a project, it’s a good sign that you can (and should!) support the project and that your contribution will go towards verifiably reducing carbon emissions.

Verified Carbon Standard — Formerly the Voluntary Carbon Standard, this standard was established in 2005 by a team of global carbon market experts, and is now administered by Verra, a registered 501(c)(3) non-profit organization that also serves as “. . .an incubator of new ideas that can generate meaningful environmental and social value at scale.”

Gold Standard Launched in 2003 by the World Wide Fund for Nature (formerly the World Wildlife Fund, SouthSouthNorth, and Helio International, the Gold Standard has certification programs available for both mandatory and voluntary carbon programs. A non-profit headquartered in Geneza, Switzerland, they’re recognized as a primary example of voluntary standards in action.

Climate Action Reserve Originally known as the “The California Climate Action Registry“ this Los Angeles based non-profit was founded in 2001 by the California State Legislature as a way to mitigate climate change through voluntary calculation and public reporting of emissions.

American Carbon Registry — Founded in 1996 as “the first private voluntary greenhouse gas registry in the world,” this program is managed by American non-profit Winrock International. They operate in both global voluntary and regulated carbon markets, and operational experience in carbon credit project registration, verification oversight and offset issuance.

But like we said earlier, just because a carbon program adheres to these standards doesn’t mean that they’re providing high quality carbon credits. Cool Effect was founded to provide buyers access to carbon credits from transparently run, high-quality, trusted projects, and we encourage individuals and businesses to expect those high standards when considering their own commitments to sustainability. We call it Carbon Done Correctly, because that’s exactly what it is.

Carbon Done Correctly is why on top of ensuring that every single carbon project on our platform is verified in accordance with at least one of the major standards above, we also take extra steps. Every international carbon standard requires a project to provide and prove measurements based on peer-approved scientific methodologies, and this documentation is reviewed by two additional independent Technical Advisory Committees. Cool Effect verifies, once more, the work of these committees, as well as validates the financial sustainability and health of the project.

Carbon Done Correctly is why we scour the globe to find the best projects that measurably reduce greenhouse gases. Starting with the carbon standards is the first step. They are a crucial tool for us as we work to ensure that each project on our platform is stable, sound, and capable of doing good for both people and the planet.

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Cool Effect
Cool Effect

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