Climate action projects
Our Expertise
Theme - Apr 10, 2023
Here we release the results of our research on climate action projects, which embrace sets of activities aimed at GHG emissions reduction. There’s a good chance to offset non-reducible emissions by introducing climate projects or purchasing carbon credits. In this research you will figure out different aspects of work within climate action projects.
Key takeaways
- Setting and, most importantly, delivering against ambitious corporate decarbonisation or net zero targets can prove a major challenge. A company can complete all stages on the path of developing a climate management system: identify all emissions sources, quantify them, analyse the results, and develop and implement a reduction strategy. And yet, all those efforts notwithstanding, there is a chance some of the emissions will still linger, as reducing or avoiding them is currently not technically feasible.
- For a project to truly contribute to combating climate change, it must rely on a number of fundamental principles. Transparency and double counting avoidance are among the most essential of those. To ensure alignment with them, as well as confidence in the final impact of the project, a system is needed that establishes the requirements for the project and monitors the implementation.
- Crediting mechanisms set out the basic principles of project implementation within the respective framework, along with detailed project requirements depending on the sector of implementation, unified project description forms developed or adopted by the standard methodology for quantifying greenhouse gas reductions or removals, etc.
- Demand for carbon credits is driven by a series of obligations established by international agreements and national laws, as well as voluntary commitments made by companies, governments, and other organizations.
- After the Kyoto Protocol ratification, various initiatives emerged in the area of accounting for carbon credits. The most notable ones were proposed by the Emerging Issues Task Force (EITF) and the International Financial Reporting Interpretations Committee (IFRIC) but were not pursued due to controversies. Another approach was developed by the International Accounting Standards Board (IASB) with the Financial Accounting Standards Board (FASB) in 2007 and is currently the most widely used approach for carbon credit transactions. There are some options available to account for Certified Emission Reductions (CER) depending on their form:
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