In response to a call for input from the United Nations regarding a public consultation on removal activities, Sky Harvest provided the input included below.
June 15, 2023
Dear Supervisory Body,
We submit this feedback in response to the public consultation regarding removal activities under the Article 6.4 mechanism: A6.4-SB005-A02. Prior to answering the specific questions, we would like to summarily express our view:
Summarily expressed viewpoint:
Our view is that the questions posed for public consultation [1] were previously and superbly answered by the Supervisory Body in its prior information note through the proposal of tonne-year accounting [2]. We are disappointed that the Supervisory Body declined further pursuit of tonne-year accounting in its 5th meeting and request that the Supervisory Body reconsider the inclusion of tonne-year accounting to answer the very questions posed for public consultation.
Of the 104 responses received to the prior information note, only 18 commented on tonne-year accounting. It is immediately apparent to us that the “silent majority” consenting to tonne-year accounting through its omission of commentary has been ignored in favor of the “vocal minority” submitting criticism at the behest of its own interests – namely, lobbying for high-cost engineered solutions that will take a decade or more to ramp up. These corporations, startups, and trade groups currently benefit from ambiguity in how the permanence of those credits should be valued. Tonne-year accounting provides a rigorous and quantitative framework for valuing the duration of carbon storage, and its adoption would undermine their perceived value proposition by effectively demonstrating how nature-based solutions, with proper accounting, can provide the same durability/permanence value as DACCS credits at lower cost.
Lastly, we would like to submit for consideration A Better Yardstick for Carbon Markets, a white-paper specifically addressing the shortfalls of our current tonne-tonne accounting system, the solutions provided by tonne-year accounting, and answers to its common criticisms. Though this white paper was published in October 2022, you will find the conclusions are the same as those of the Supervisory Body in its previously published information note [2]. This is no coincidence. This is convergent thinking – the process through which better ideas can replace the overly simplistic ideas that are currently inhibiting the growth of carbon markets.
Of note:
Sky Harvest would advocate that the Supervisory Body adopt a time horizon of infinity (or the effective mathematical equivalent of one million years), in lieu of the 100-year or 200-300-year time horizon. Because of the adoption of a discount rate, there is no need to arbitrarily limit the time horizon considered (see our calculator).
While Sky Harvest advocates the use of a higher discount rate, we acknowledge the normative nature of this selection, and think the Supervisory Body has proposed a reasonable approach to narrowing in on what appears to be a 2.0% discount rate. More importantly, the only discount rate that we know to be wrong – 0.0% – is the very discount rate assumed by the status quo: tonne-tonne accounting.
We acknowledge that tonne-tonne accounting is the status quo of carbon markets today, and think the Supervisory Body’s proposal to allow both tonne-tonne accounting and tonne-year accounting simultaneously is an important interim step in transitioning towards a market that can employ tonne-year accounting universally in the future.
Responses to specific questions:
2.1 | No comment
2.2 | No comment
2.3(a) | Consistent with ex-post tonne-year accounting, the “monitoring period” should span the time horizon of all sequential crediting periods for any specific project and is the time period over which the project is monitored. The monitoring period should end with the end of the final crediting period, after which no further credits will be generated. If a project is renewed or extended, such action would add additional crediting periods and extend the project’s monitoring period.
2.3(b) | Consistent with ex-post tonne-year accounting, the “crediting period” represents any period for which the carbon benefit is quantified, and credits are issued. A carbon project may have multiple subsequent crediting periods. For example, the first crediting period represents Years 1-10, the second Years 11-15, the third years 16-25, and the fourth Years 26-30 for a 30-year project. Credits would be issued after Year 10, 15, 25, and 30. The monitoring period would be Years 1-30.
2.3(c) | Consistent with ex-post tonne-year accounting, reversals do not need to be addressed and therefore no timeframe for addressing them is needed. Note: Reversals do not need to be addressed because there is no dependence on future storage of carbon like that of tonne-tonne accounting; the credits issued are for climate benefits that have already occurred. [3]
2.A | “Removals” should include all approaches to removing greenhouse gases from the atmosphere, including engineered solutions (e.g., DACCS, enhanced weathering) and nature-based solutions (e.g., IFM, afforestation, ocean-based methods).
2.B.1 | Using ex-post tonne-year accounting, there is no risk of reversal [3]. That said, the maximum timeframe between monitoring should be the shorter of the crediting period and 10-years. This will ensure that there are not large fluctuations in carbon stocks which may not be measured if the maximum period between monitoring is greater than 10 years. There should be no minimum timeframe for monitoring, which may in the future unlock continuous monitoring as technology advances.
2.B.2 | No comment
2.C.1 | We advocate minimum project activity periods as a necessary companion to tonne-year accounting for reasons of additionality. It is our current view that minimum activity periods are activity-specific and should be determined accordingly in the respective methodologies. For the activity with which we are most familiar, Improved Forestry Management, the minimum activity period should be five years. Five years is conservatively longer than the lead time for procuring logging services, ensuring that the deferral extends beyond a landowner’s known intent to harvest, which better demonstrates additionality. This is confirmed by feedback in a Verra public consultation which advocated a minimum five-year project activity period for the same reason.
2.C.2 | Simplistically, removals should include the storage of any greenhouse gas that was previously in the atmosphere (including that stored in the biosphere) and reductions should include the avoidance of emissions from the geosphere into the atmosphere.
This definition of removals would include various types of credits sold as removals, like biochar and BECCS, that are in fact avoiding emissions of carbon previously sequestered from the atmosphere.
We acknowledge this definition is a simplistic framework for the current carbon market. In the future, we think a better framework would monitor the flow of carbon in and out of the atmosphere, which appropriately side-steps the imprecision of the false removal-reduction dichotomy. However, current carbon markets are not prepared to adopt such a framework in the near term.
2.D | Assuming the option of ex-post tonne-year accounting, the crediting period should have a minimum of one year and a maximum of 10 years, in between which it is at the discretion of the project proponent. This minimum – which must be subject to the minimum project activity period (see response to 2.C.1) – ensures that the project is measuring over a reasonable time horizon. The maximum crediting period ensures consistency with the maximum timeframe between monitoring for the same reasons (see response to 2.B.1)
2.E.1-6 | The need to address reversals is eliminated when using ex-post tonne-year accounting. [3] This is a primary benefit of tonne-year accounting. Other methods for addressing reversals have proven their inadequacy. Moreover, future sources of reversals (e.g., geological leakage) are unknown and therefore impractical to address through such mechanisms as buffer-pools or insurance.
2.F | No comment
2.G | No comment
About Sky Harvest
Sky Harvest is an independent carbon project developer seeking to solve integrity issues in the carbon market, through the development of new methodologies that solve legacy issues undermining the credibility of carbon markets and inhibiting their growth.
Thank you for the invitation to provide input, and thank you for your thoughtful consideration and due process with which you have approached this important decision.
Best regards,
Will Clayton
CEO, Sky Harvest
3. Note: Reversals do not need to be addressed because there is no dependence on future storage of carbon like that of tonne-tonne accounting; the credits issued are for climate benefits that have already occurred.
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