• August 20, 2024

Carbon Credits from Peatlands – an exchange of experience with Rewilding Europe

An initial discussion on verification standards and approaches for reductions of greenhouse gas emissions from peatlands.

On June 6, 2024, the projects LIFE Multi Peat and Peat Carbon hosted a workshop on the methodological aspects of carbon credit verification standards. Experts from both projects, and the Dutch programme, Valuta Voor Veen, discussed how landowners can effectively sell carbon credits from peatlands. Since there is still much lack of knowledge, suspicions, and downright confusion surrounding this topic, Rewilding Europe was invited to introduce the process, showing participants how they work with landowners to sale carbon credits. 

As a project developer, the Rewilding Europe Foundation aims to make rewilding a financially competitive land use, showing that it has investment potential and, above all, enabling restoration on a large scale with benefits for local communities. The Foundation is already helping University of Galway, the Multi Peat partner in Ireland, develop carbon credits from their peatland site. This initiative may lead to the first sale of carbon credits from peatlands in Ireland. 

Carbon Credit Verification standards

During Rewilding Europe’s presentation, we learned that to develop carbon credits from a peatland area, a carbon credit verification standard must be applied. There are regional, national, and international standards, which set the framework that will guide the landowner from the beginning until the sale of the carbon credits generated; the process includes preparatory work and planning, establishment of a baseline, the actual restoration, as well as the continued monitoring of the site after implementation. Basically, the standard regulates the rules surrounding measurement, reporting, and verification of the carbon credits. 

Which standard is chosen may depend on whether the country where the site is located has developed their own standards. Many countries are developing national or regional standards; for example, Germany’s states of Brandenburg, Mecklenburg-Western Pomerania, and Schleswig-Holstein have Moorfutures. Netherlands and the United Kingdom have recently developed Valuta Voor Veen and UK Peatland Code, respectively. At the international level, the Verra standard is one of the most recognised. The white paper from the project Interreg Care-Peat provides a great overview and analysis of the various applicable standards.

From the perspective of the landowner, following the standards can be complicated and expensive, moreover, the financial return is uncertain, as it depends on carbon prices and the natural features of the site, for example, the level of degradation. Indeed, many aspects need to be considered to have an eligible site, whereby GHG reductions can be verified and sold as carbon credits. These may vary according to the applied standard but will, generally, address land ownership structure, allowed activities within as well as surrounding the site, criteria for peatland definitions, and several other important elements that were discussed by Rewilding Europe in the presentation, like monitoring requirements to establish baseline and future scenarios. 

The breakout group session

During the breakout sessions, where participants were divided into smaller groups, the following questions were discussed: 

1. What makes you hesitate in trying to sale carbon credit from peatland areas?
2. What is missing or what are the practical or institutional limitations?
3. Would you pursue alone or prefer to outsource?

According to experts, the most common causes for hesitation touched upon the concept of additionality, revenue uncertainty, lack of national frameworks, insecurities about the quantification methods of emissions reductions, questions surrounding timescale of carbon credit, as well as greenwashing concerns. For instance, regarding additionality, how do carbon credit schemes fit with the countries’ own international and national commitments to carbon reductions from peatlands?

A further cause for hesitation is the fear of perverse incentives, whereby carbon credit schemes reward landowners with more degraded peatlands as opposed to the landowners that kept their peatlands in good conditions. This way, landowners from countries that still have larger proportion of peatlands in good condition will not benefit from carbon credit schemes.

When it came to answering the second question of practical and institutional limitations, experts cited technical, legal, and financial barriers. Referring to monitoring techniques, the primary system of verification should still be direct measurement, as it serves to calibrate and correct modelling. However, this technique tends to be very expensive and can represent a barrier for most landowners. 

Furthermore, the question of trust was often raised. Regional and national standards were considered more trustworthy compared to bigger international standards. The general approach of one size fits all is not ideal. Standards should be more appropriate to the local area, as conditions vary in each country, and even if countries have similar landscapes and features, land use may vary a lot. For example, a fragmented landownership structure, with multiple smaller land areas, acts as a significant limitation, due to the de facto veto power of neighbouring lands.

Finally, there was little time remaining to discuss the last question. The general attitude was that outsourcing would only increase costs of an already very expensive endeavour without guarantee of proper return. Though, it was also recognised that, given the complexities of the carbon credit process and schemes, outsourcing services could greatly help landowners. 

Takeaway

There are still myriad questions, uncertainties, and shortcomings surrounding carbon credit schemes for peatlands. Nevertheless, the urgent biodiversity and climate crises demand immediate action. Already, there are international and, in some cases, regional and national standards in place that can be applied. Extended use of these schemes is needed to continue to improve their reliability along with increasing public acceptance; with the underlying aim of enabling significant upscaling of restoration initiatives. Ultimately, the sense is that we cannot wait for the perfect scheme and an exhaustive knowledge of the dynamics of greenhouse gas fluxes. We must work with what we have and continue to try to improve along the way.

A more detailed summary of the workshop can be found below with the title 'Workshop summary report'