Platts proposes to update its Voluntary Carbon Credits Methodology to better reflect the impact of host country credit export bans

Platts, part of S&P Global Commodity Insights, is proposing to update its Voluntary Carbon Credits methodology in order to better reflect the impact of host country credit export bans of voluntary carbon credits.

This change would look to cover both already introduced and future export bans of VCM credits by specific host countries.

Platts is proposing to amend its voluntary carbon credit methodology to explicitly state that its voluntary carbon credit assessments reflect the most internationally fungible carbon credits laid out in the Platts Voluntary Carbon Credit Methodology.

Currently, the Platts Voluntary Carbon Credit price assessments reflect the most competitive credits by project type that meet the specifications laid out in the Platts Voluntary Carbon Credit Methodology.

This proposal follows on from recent announcements by Indian government officials that the export of voluntary carbon credits produced in India could be banned under recently passed legislation developing a domestic carbon credit market. This announcement has had a significant impact on the price of voluntary carbon credits produced in India, particularly in the Renewable Energy carbon credit market, which has seen them trade at increasingly steep discounts to other comparable types of voluntary carbon credits.

Following the formal adoption of Article 6 of the Paris Climate Agreement, more host countries are exploring the implications of the Corresponding Adjustment mechanism and the development of domestic carbon credit markets, which is expected to impact the availability of Voluntary Carbon Credits available in the international market. Platts is continuing to monitor these changes as they develop.

Please send any feedback, questions or comments to platts_carbon@spglobal.com by Oct. 24, 2022.

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