eBusiness Weekly
Martin Kadzere
The guidelines to establish a national entity to issue carbon credits to local projects are complete, according to Environment, Climate, Tourism, and Hospitality Industry Minister Mangaliso Ndlovu.
“A lot of work has been done and are (the guidelines) ready for approval by the Cabinet,” Ndlovu told Business Weekly in a phone interview this Tuesday.
The Government has been working with experts to craft the guidelines in a bid to establish an entity to certify and issue carbon credits to local climate change projects.
A carbon credit is a permit that represents the removal of carbon dioxide from the atmosphere and can be purchased by an individual or a company to offset emissions resulting from their industrial production processes, delivery vehicles, or travel.
For every tonne of avoided greenhouse emissions, the project owner receives credits, which can be sold to firms with a voluntary or compliance carbon reduction strategy.
While carbon credits are often created through forestry practices, a credit can be made by nearly any project that reduces, avoids, destroys, or captures emissions.
Some climate change experts, however, said while having a local entity mandated to issue carbon credits was a noble idea, the high costs involved in engaging international institutions and achieving global recognition might be “very difficult.”
“Projects that generate carbon credits are getting verified and satisfied by bodies outside Zimbabwe, which is an expensive process,” a climate analyst, who preferred not to be named told Business Weekly recently.
“So in a way, it could make sense to have a national entity, which issues carbon credits. But will it gain international recognition given Zimbabwe’s perceived record internationally? Can anybody legitimately say these carbon credits have been issued by a Zimbabwean entity and say that the credit is legitimate,” the analyst quipped.
With global demand for carbon offsets picking up as more companies seek to lower their carbon footprint, there are already growing calls from stakeholders calling for the setting up of an organisation that certifies and issues carbon credits in the country.
At the moment, Carbon Green Africa (CGA) verifies and validates REDD+ projects in Zimbabwe to generate carbon credits to offset footprints by every player across the globe thereby mitigating the effects of climate change.
CGA has a local team and network of partners, which has created core competencies, which has enabled successful conservation projects governed by the rules of the Verified Carbon Standard and the community, climate and Biodiversity Standard (CCBS) at gold level while at the same enabling the project to be financially viable for all parties involved.
REDD+ is a framework created by the United Nations Framework Convention on Climate Change Conference of the Parties (COP) to guide activities in the forest sector that reduces emissions from deforestation and forest degradation, as well as the sustainable management of forests and the conservation and enhancement of forest carbon stocks in developing countries.
Recently, Invictus Energy entered a 30-year contract with the Forestry Commission of Zimbabwe for the development of the Ngamo-Gwayi-Sikumi (NGS) REDD+ project for a further 30 years, as part of the oil and gas company’s plan to manage carbon emissions.
The project will enable Invictus to fully offset all scope 1 and 2 emissions generated across the entire lifecycle of the Cabora Bassa (Muzarabani) project.
The oil and gas industry is among the most emissions intensive, with the production and use of oil and gas accounting for over half of global greenhouse gas emissions associated with energy consumption.
This equates to more than 17 gigatonnes of carbon dioxide equivalent per year, with about 90 percent of these emissions coming in the downstream use of hydrocarbons.
Oil and gas companies are coming under increasing pressure to demonstrate portfolio resilience and adapt business models to align with a low-carbon energy transition
Carbon market analyst Jeff Gogo told Business Weekly that in an era where major corporates throughout the world were using voluntary offsets to work towards carbon neutrality, it was not surprising that Invictus would be towing a similar line given the extent of the threat of climate impact from its oil and gas project in Muzarabani.
“It is noteworthy that the company is looking to offset its own carbon emissions via a forest-based project,” Gogo said.
“The IPCC, that is Intergovernmental Panel on Climate Change, says we can’t fix the climate mess without developing carbon capture and storage technologies, but the only technology proven to capture and store carbon at a meaningful scale is trees.
“In that sense, Invictus says that it is offset programme is purely voluntary, ostensibly in pursuit of a mission to combat climate change. A cynic would say that’s just corporate posturing.
“But it would even be more interesting to see whether the company continues with such advocacy beyond the scope of its current project.”
Invictus was hoping to avoid on average one billion tonnes of carbon dioxide equivalent per year, which would completely offset its entire emissions from what it calls scope 1 and 2 phases of its project, with the excess sold on global carbon markets.
“We are talking of over 30 million carbon credits over 30 years,” said Gogo.
“With the average price of forest-based credits currently at around US$7,34 per tonne, the project could become a large source of revenue not only for Invictus but also for local communities within which the project would be undertaken.
“It may be the first REDD+ in Zimbabwe which, provides direct income to the government through the Forestry Commission, with whom profits are to be shared.”
Gogo however noted carbon markets have historically been marred by accusations of projects selling “hot air” — meaning that they sell falsified carbon credits, some of which “don’t even exist.”
“So, there’s still a lot of independent auditing that needs to take place to verify the credits. Also, Invictus remained vague about how it intends to work with local communities and how exactly they will benefit from its carbon offset programme.
“Ideally, REDD+ projects must be designed in a way that deliberately targets community benefit,” said Gogo.
