Increased focus on using carbon offset projects to remove greenhouse gases is prompting greater interest in "blue carbon" projects, which use coastal and marine ecosystems to cut or altogether avoid GHGs.
Receive daily email alerts, subscriber notes & personalize your experience.Register Now
Such ecosystems include mangroves, tidal marshes, seagrass meadows and peatlands. Such coastal ecosystems sequester carbon in the body of the plants but also especially in underlying sediments. For example, more than 95% of the carbon sequestered by seagrass meadows is sequestered in the soil, according to data from the Blue Carbon Initiative.
Data from the same organization shows that about half of the total carbon sequestered in ocean sediments is stored in coastal habitats. But with 340,000 to 980,000 hectares of coastal ecosystems destroyed each year, the CO2 trapped in these ecosystems is being released back into the atmosphere.
Currently, there are two types of Blue Carbon Initiative projects active and issuing carbon credits: the conservation and restoration of mangrove forests and the restoration of wetlands, such as peatlands.
Moving beyond mangroves and wetland projects, however, is proving challenging.
Projects under consideration by the world's largest certifiers of carbon projects include kelp and seaweed farming, seabed management, sustainable fishing, and conserving and restoring seagrass meadows and salt marshes. The main obstacle in creating methodologies for these projects lies in the measurement of the carbon removed and stored in the marine ecosystem.
"The sediments or organic material that are trapping carbon under the algae could be coming from elsewhere, brought there by currents," said Giancarlo Raschio, senior manager-land use at Gold Standard, the world's second-largest certifier of carbon projects in terms of credits issued. "So how do you know that your project is increasing the carbon sequestration?"
Lack of data
Understanding a project's additionality -- under which carbon credits can only be issued when a project proves it would not exist in the absence of carbon finance, meaning that there are no other financing streams available -- for some of these projects could also be challenging, Raschio said. For example, some existing seaweed farming projects rely of the sale of seaweed, which is used both as a fuel or as food, to finance themselves, he added.
One more challenge comes from the lack of data currently able to show if any of these projects would undermine marine life.
"Are large algae forests good for ocean life?" Raschio asked. "Will they reduce amount of light that reached underwater?"
Rashcio said there could be side effects, "and this all needs to be researched."
According to Amy Schmid, manager for Blue Carbon Innovations at Verra, the world's largest certifier, the permanence of these type of projects would also be hard to prove.
"A challenging question for kelp projects lies in their permanence," Schmid said. "Major storms can uproot kelp roots, and this impacts their sequestration ability since the soil underneath would also be impacted."
Permanence is another core principle of carbon markets, under which the impact of GHG reduction is at risk of reversal and should result in a permanent drop in emissions.
Given all these question marks, Gold Standard is evaluating if there really is a possibility of launching other blue carbon projects beyond mangroves.
Verra, meanwhile, has decided to partner with other participants in the sector to catalyze research in the area and develop new methodologies faster. These include the Blue Carbon Initiative, the Blue Marine Foundation, Ocean 2050 and Silvestrum Climate Associates.
"In the past, we would dedicate few years to research and then a few more years to write the project's methodology," Schmid said. "With this collaboration, we are able to do it all together and rely on research that has already been done."
Verra is moving fast on launching its first seagrass meadows project.
"The first project is about to reach validation under VCS," Schmid said. "First carbon credits could be issued as early as 2022, depending on the length of the validation process."
The project is being carried out in the US by the Nature Conservancy in collaboration with the Virginia Institute of Marine Science. It aims to restore eelgrass and the former scallop population in Virginia's coastal bays, both wiped out in the 1930s by disease and hurricanes.
Mangrove projects represent the largest share of blue carbon currently issuing carbon credits. Verra has certified 10 mangroves of them.
Verra created the first methodology for mangrove conservation and restoration projects a year ago, in September 2020. The methodology was modeled on the already existing one for REDD+, or avoided deforestation, projects.
Gold Standard is developing its own methodology for mangrove projects. Unlike Verra, Gold Standard doesn't certify REDD+ projects (it doesn't believe in the possibility of proving the additionality of these types of projects), so instead of adapting an avoided deforestation project, it had to create new stand-alone methodology.
In line with its stance on avoided deforestation projects, Gold Standard has decided that once certified, a Gold Standard mangrove project will only issue credits for the sequestration targets met by the project, and not the avoided deforestation.
"We are going to credit the increase in biomass obtained by the project," Raschio said.
Gold Standard is hoping to have its methodology ready by the end of the year or Q1 2022 at the latest. It also expects to have its first mangrove project submitted by Q3 2022, Raschio said.
Mangrove carbon credits issued by projects in Asia and Central America are currently being offered in the $13-$35/mtCo2e range, a trader told S&P Global Platts.
Mangrove carbon credits can trade at a higher price compared with other nature-based credits because they help meet several targets beyond carbon absorption or sequestration: preventing floods; preserving mangrove and ocean biodiversity; filtering pollutants; and offering food security to local communities.
Mangrove credits fall within the nature-based removal credits category, and they are reflected by Platts Nature-Based Removal price assessment, along with other criteria, such as afforestation, reforestation and soil sequestration like biochar projects. This price was assessed Oct. 25 at $13.05/mtCO2e.
A third certifier, American Carbon Registry, has two active methodologies for wetland carbon: Restoration of Pocosin (bog) Wetlands and Restoration of California Deltaic and Coastal Wetlands.
"To date there is one project that has received offset credits using the California methodology, and there is one project that is still undergoing its first verification using the Pocosins methodology," said Jessica Orrego, forestry director at ACR, a division of Winrock International.
With demand for carbon credits sustained, new types of blue carbon credits beyond those now available should continue to be of strong interest to markets -- and the public -- ever more concerned about greenhouse gases.