Around 10 biodiversity credit project managers have expressed interest in selling units via an online marketplace, following the listing of credits from a company with South American sites, Carbon Pulse has learned.

The credit initiatives contacted voluntary carbon credit platform Emsurge to ask for more information, after the listing from US-based Savimbo went live last month, said Melissa Lindsay, CEO of the organisation.

Savimbo listed biodiversity credits for $5 a unit on Emsurge on Dec. 15. The company is creating land-based credits in cooperation with smallholder farmers and Indigenous groups mainly in the Colombian Amazon.

“We’ve had a lot of people on the supply side reach out,” Lindsay told Carbon Pulse. “The majority has been people looking to produce their own biodiversity credits. They’ve got pilot projects with Verra, Plan Vivo, and Gold Standard, in Africa and South America.”

“We’re onboarding people at the moment to upload their projects to the platform. I would imagine we would get a wave of offers as soon as there is clarity from the standard setters on how the measurement, verification, and issuance will work.”

Supply will increase following the release of the first iteration of Verra’s nature credit standard this year, as providers using the organisation’s carbon standard turn to biodiversity, Lindsay predicted.

“Our launch is early, but it is at a low cost. It means we can add structure to the market from its inception and start gathering data. In two years’ time, we will be where we are [now] in carbon, where we have got enough historical data to identify trends.”

Emsurge has received few enquiries about buying Savimbo’s available credits, but demand is “coming” as companies increasingly look to market themselves as nature positive, Lindsay predicted.

Texas-headquartered Savimbo also marketed its credits on carbon blockchain platforms Senken and Dovu last year, and has been in talks with Xpansiv about listing on its exchange.

LIQUIDITY

Savimbo uses Cercarbono’s standard, released for consultation in December, under which a unit represents improvements in biodiversity throughout one hectare over two months. At $5 a unit, one ha could generate $30 from six units over one year.

The Indicator Species Biodiversity Methodology (ISBM), developed by Savimbo, is built around the conservation of so-called indicator species – those that can only thrive in healthy ecosystems.

Savimbo’s projects have largely been focused on jaguars, but the methodology is open to other indicator species in any ecosystem type anywhere in the world, with documents saying some 20-30 species in each bioregion can be selected.

Biodiversity credits should be tradable with those from other companies using the same certification, Lindsay said.

“You can’t build liquidity and attract large institutional investment if everyone’s doing something different. If they at least have the same measurement, there might be some interchangeability between credits.”

“We are a long way off biodiversity credits becoming a standardised product, but in order to attract investors on top of end buyers, there needs to be line of sight of demand, and that demand needs to be centralised around the same core products.”

Financiers might speculatively invest in credits using a particular standard if they can see evidence of demand, she said.

STORYTIME

Emsurge recycled the digital formatting it uses for carbon credits for biodiversity. Details on the biodiversity credit include:

• Standard
• Overview
• Specification
• Registry
• Full name
• Country

The project specification category contains the main differences to Emsurge’s carbon listings for biodiversity. “We’re talking about which biomes and what kind of impact – whether it’s uplift or protection, and then whether it’s conservation, restoration, eradication, or pollination,” Lindsay said.

“I suspect people will like to story-tell around biodiversity credits. Corporates want to be able to sell some kind of marketing story, such as compensating supply chain nature impacts with corresponding credits.”

One of the main sources of demand for biodiversity  credits in the early stages of the market will be stacking them, where units from biodiversity and carbon markets are sold separately from the same piece of land, she said.

“You are already see buyers paying a premium for Verra’s Climate Community and Biodiversity standard, or certification of the UN’s Sustainable Development Goals, but these can take years to be verified and issued alongside the carbon.”

Biodiversity credits could provide a faster and more economical source of finance to buyers through digital monitoring, reporting, and verification, she said.

By Thomas Cox – t.cox@carbon-pulse.com

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