Implementing a ‘bioeconomy’ approach on biodiversity credit project areas in the Amazon could help developers stay afloat at a time when demand for units has yet to pick up, the founder of a Brazil-based nature tech company has told Carbon Pulse.

The bioeconomy angle would involve maximising the economic benefits of non-timber forest products within the conservation areas, and where project developers intend to generate credits, according to Nathaniel Calhoun of Bioverse.

“Biodiversity credits are still trying to find their place of affordability, and there’s not enough money to reach the ground,” he said.

Although attention to the voluntary biodiversity credit market has increased after the 2022 Kunming-Montreal Global Biodiversity Framework, which carved out a role for nature-based solutions in plugging the financing gap on nature, companies have not yet translated their interest into transactions.

“Project developers that are just about to start may struggle to sell credits in the short term and, therefore, keep the project going, unless they fully understand how the area could be utilised in a bioeconomy perspective.”

Bioeconomy encompasses a wide range of activities and sectors, such as agriculture, forestry, food, and biotechnology. Its applications include combining sustainable agriculture with forest restoration in degraded lands.

In recent months, several initiatives have emerged to scale the bioeconomy, particularly in the Amazon basin, where Bioverse operates.

EXPANDING NBS IN THE AMAZON

Launched in 2020, Bioverse works with companies, international organisations, and local harvester cooperatives to expand nature-based solutions across Brazil, with a focus on non-timber products such as nuts and tree oils.

“We leverage a drone platform that can scan 40 square kilometres in a day, and outputs a forest inventory that locates and makes yield prediction around every non-timber forest specimen in that area,” Calhoun said.

Under the initiative, local communities are trained to use the platform, he added. “This helps organisations and local communities see where the clusters are, how close they are to the roads and rivers, and gives them a sense of the economic potential in their area.”

“If they were harvesting from five species, we might be finding somewhere between 25-75 times more potential for them economically.”

Adopting this approach could radically change the economics of how much money is coming out of each hectare of the project areas, he argued.

“After 10 years of development, you could have $10,000 per ha coming from non-timber forest products and $500 from credits. Also, biodiversity credits generated within these conservation areas are likely to emerge as the ones that are most attractive to the market.”

ECONOMIC ADVANTAGE

Project developers doing ecosystem restoration should consider whether there’s an opportunity to create highly productive buffers within that ecosystem, he added.

“This would give a massive economic advantage both to the developers and the people living on the edge of the forest. The economics are so favourable if you go about this correctly,” Calhoun added.

“Once the engine of the bioeconomy is humming, the project is more likely not only to be financially sustainable, but also to generate long-term environmental outcomes.”

Calhoun said Bioverse has already held conversations with major players in the biodiversity space, including Terrasos and RePlanet, on how to ramp up the focus on the bioeconomy in the emerging credit market.

Currently, the global bioeconomy is estimated at $4 trillion, with a potential to expand to as much as $30 trln by 2050, according to the World Bioeconomy Forum. China predicts that its bioeconomy will reach a value of $3.3 trln by 2025.

In March, Brazil and France announced a €1 billion plan to ramp up financing towards bioeconomy in the Amazon.

The Brazilian government is also leading a global initiative tasked with drafting high-level principles to be an integral part of the Rio Declaration, set to be adopted by G20 countries at the end of the Brazilian presidency in November.

By Sergio Colombo – sergio@carbon-pulse.com

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