Excessive-quality worldwide carbon credit will complement home emission discount efforts to attain internet zero by 2050
JOINT NEWS RELEASE BETWEEN NEA AND MSE
Singapore, 4 October 2023 – The Ministry of Sustainability and the Setting (MSE) and the Nationwide Setting Company (NEA) have set out the Eligibility Standards below the Worldwide Carbon Credit score (ICC) Framework.
2. The ICC Framework was launched in November 2022, alongside the progressive improve in carbon tax charge below the Carbon Pricing (Modification) Invoice from the present S$5 per tonne of emissions to S$25 per tonne in 2024 and 2025, and S$45 per tonne in 2026 and past. This ICC Framework will permit carbon tax-liable corporations to make use of eligible ICCs to offset as much as 5 per cent of their taxable emissions from 1 Jan 2024.
3. The ICC Framework helps the event of carbon markets, by enabling the demand and provide of high-quality carbon credit to be matched. Firms can achieve entry to different decarbonisation pathways for hard-to-abate emissions, and within the course of, channel monetary assets to help emissions discount or removing tasks globally.
4. The ICC Framework will likely be aligned with Article 6 of the Paris Settlement, enabling Singapore to cooperate with different nations to help our respective local weather targets. Efficient worldwide cooperation, corresponding to by carbon markets, is a crucial a part of Singapore’s efforts to attain internet zero emissions by 2050, given Singapore’s nationwide circumstances as an alternative-energy deprived nation with restricted home mitigation potential.
Guaranteeing Excessive Environmental Integrity of ICCs
5. The Eligibility Standards requires ICCs to characterize emissions reductions or removals that happen throughout the timeframe specified below Article 6 of the Paris Settlement, and meet seven rules to display excessive environmental integrity. These seven rules have been developed in session with greater than 70 stakeholders throughout the trade and non-governmental organisations. They take reference from essentially the most rigorous and respected worldwide requirements, such because the Carbon Offsetting and Discount Scheme for Worldwide Aviation (CORSIA [1]).
6. The seven rules and their definitions are listed in Desk 1 beneath. Please see Annex A for an illustration of how a carbon credit score venture is assessed towards every precept. As environmental integrity requirements proceed to evolve, the Eligibility Standards will likely be reviewed periodically to align with developments in Article 6 of the Paris Settlement and high-integrity carbon markets.
Desk 1: Eligibility Standards for ICCs
|
Precept |
Definition |
|
To adjust to Article 6 of the Paris Settlement, the licensed emissions reductions or removals should have occurred between 1 January 2021 and 31 December 2030. |
|
|
Not double-counted |
The licensed emissions reductions or removals should not be counted greater than as soon as in contravention of the Paris Settlement. |
|
Further |
The licensed emissions reductions or removals should exceed any emissions discount or removals required by any legislation or regulatory requirement of the host nation, and that will in any other case have occurred in a conservative, business-as-usual situation. |
|
Actual |
The licensed emissions reductions or removals should have been quantified primarily based on a sensible, defensible, and conservative estimate of the quantity of emissions that will have occurred in a business-as-usual situation, assuming the venture or programme that generated the licensed emission reductions or removals had not been carried out. |
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Quantified and verified |
The licensed emissions reductions or removals should have been calculated in a fashion that’s conservative and clear, and should have been measured and verified by an accredited and impartial third-party verification entity earlier than the ICC was issued. |
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Everlasting |
The licensed emissions reductions or removals should not be reversible, or if there’s a danger that the licensed emissions reductions or removals could also be reversible, there should be measures in place to watch, mitigate and compensate any materials reversal of the licensed emissions reductions or removals. |
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No internet hurt |
The venture or programme that generated the licensed emissions reductions or removals should not violate any relevant legal guidelines, regulatory necessities, or worldwide obligations of the host nation. |
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No leakage |
The venture or programme that generated the licensed emissions reductions or removals should not end in a fabric improve in emissions elsewhere, or if there’s a danger of a fabric improve in emissions elsewhere, there should be measures in place to watch, mitigate and compensate any such materials improve in emissions. |
7. Because the administrator of the carbon tax regime below the Carbon Pricing Act, NEA will develop processes to find out which ICCs adhere to the Eligibility Standards earlier than carbon tax-liable corporations use the ICCs to offset their taxable emissions. Extra particulars on these processes and a listing of eligible host nations, carbon credit score programmes and methodologies that adhere to the Eligibility Standards will likely be launched by the top of this yr.
Institution of Worldwide Advisory Panel for Carbon Credit
8. An Worldwide Advisory Panel for Carbon Credit (IAPCC) has additionally been set as much as advise the Singapore Authorities on Singapore’s insurance policies referring to carbon credit, together with issues on environmental integrity and carbon market growth.
9. The Panel includes six esteemed members with experience throughout the fields of sustainability, worldwide growth and finance. The panel is chaired by Professor Bertil Andersson, President Emeritus of Nanyang Technological College (NTU). Membership of the IAPCC will be present in Annex B.
10. Professor Bertil Andersson stated, “Excessive-quality carbon credit have a lot potential to advance international local weather ambition. You will need to promote clear and strong carbon markets and uphold excessive environmental integrity of carbon credit. I look ahead, along with my fellow panel members, to working with the Singapore Authorities in efforts to unlock carbon financing to speed up the worldwide internet zero transition.”
Different Developments on ICCs
11. The institution of the ICC Framework and the Worldwide Advisory Panel for Carbon Credit are among the many newest initiatives to help Singapore’s place as a carbon companies and buying and selling hub. Different notable initiatives embrace:
12. Fostering worldwide partnerships within the international carbon market to open new sources of ICCs that meet Singapore’s Eligibility Standards.
a) Singapore has substantively concluded negotiations with Ghana and Vietnam on Implementation Agreements setting out the necessities and processes for Article 6 compliant carbon credit score cooperation. Carbon tax-liable corporations can supply for ICCs generated below these Implementation Agreements to offset their taxable emissions.
b) Memoranda of Understanding (MOUs) to work in the direction of Implementation Agreements have additionally been signed with different host nations: Bhutan, Cambodia, Chile, Colombia, Dominican Republic, Indonesia, Kenya, Mongolia, Morocco, Papua New Guinea, Peru and Sri Lanka. Singapore can be in lively dialogue with a number of different nations together with Brazil, Brunei and Thailand.
13. Growing enabling infrastructure and the carbon companies ecosystem. As a part of the ICC Framework, NEA is growing a nationwide registry to account and observe the ICCs surrendered by taxable services in compliance with Article 6 guidelines.
14. NEA has signed MOUs with 5 carbon credit score programmes to leverage on their capabilities in making certain that ICCs issued below their programmes and subsequently used to offset taxable emissions are robustly validated, verified, issued and retired. These programmes embrace the Gold Normal, Verra’s Verified Carbon Normal, International Carbon Council, American Carbon Registry and the Structure for REDD+ Transactions. We intend to develop our partnerships to extra programmes sooner or later.
15. Singapore has additionally partnered the World Financial institution and the Worldwide Emissions Buying and selling Affiliation (IETA) on the Local weather Motion Knowledge Belief (CAD Belief) initiative. CAD Belief is growing a Knowledge Dashboard to offer an open-source, decentralised blockchain infrastructure that permits the general public to entry details about carbon credit issued throughout completely different registries globally, enhancing transparency and minimising double counting danger. The Dashboard is anticipated to be launched later this yr.
[1] CORSIA requirements have been developed and backed by a multilateral course of led by the United Nations Worldwide Civil Aviation Organisation (ICAO) in session with inexperienced teams and specialists. It was adopted in 2016 to handle emissions from worldwide aviation.
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Annex A
Illustration of how a Carbon Credit score Challenge is Assessed below every Precept
1. Eligible ICCs should fulfil all rules below Singapore’s Eligibility Standards.
2. Desk A-1 illustrates a simplified evaluation of a carbon credit score venture towards every precept. That is meant to facilitate understanding, and is not consultant of the particular processes utilized in evaluating and verifying particular person tasks.
Desk A-1: Simplified evaluation of a carbon credit score venture towards every precept
|
ICC Challenge kind |
Provision of biogas digesters that convert natural waste into clear vitality for heating and cooking |
|
Precept below Singapore’s Eligibility Standards |
Key concerns in assessing this precept in relation to the ICC Challenge |
|
Not double-counted |
Singapore has an Implementation Settlement in place with Nation X, which units out the necessities and processes for carbon credit to return with corresponding changes, i.e., the emissions reductions represented by the carbon credit score utilized by carbon tax-liable corporations in Singapore to offset their taxable emissions will solely be counted in the direction of Singapore’s local weather targets. These emissions reductions will not even be counted in the direction of Nation X’s local weather targets. |
|
Further |
Underneath a business-as-usual (BAU) situation the place the venture didn’t happen, residents would have continued to gather and burn firewood to warmth up their houses and prepare dinner meals. This may have resulted in carbon emissions from deforestation. Nonetheless, with the implementation of the venture and the financing from carbon credit, households are supplied with biogas digesters which ferment natural waste corresponding to manure, providing another supply of unpolluted vitality within the type of biomethane. This reduces the reliance on firewood, and the ensuing carbon emissions from deforestation. Therefore, the venture fulfils the “further” precept. |
|
Actual |
With the implementation of the venture, emissions have been lowered from a reputable and conservative baseline, leading to actual emissions reductions. This baseline is the BAU situation whereby firewood proceed for use, and was decided from subject research that confirm the prevalence and entrenchment of firewood use as a group follow. |
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Quantified and verified |
Unbiased, third-party verifiers have quantified and verified the emissions lowered by the venture throughout the complete venture timeframe, primarily based on a sturdy measurement, reporting and verification framework. |
|
Everlasting |
The emissions reductions derived from biogas digesters and ensuing discount in use of firewood are not reversible, because the vitality wants of the agricultural group throughout the venture timeframe have already been met by biomethane from biogas digesters as an alternative of firewood or different emissive fuels. |
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No internet hurt |
Biogas digesters has resulted in no internet hurt, and even delivered co-benefits to native communities in Nation X, corresponding to cleaner air high quality from burning biomethane, a smokeless gas, as an alternative of firewood. |
|
No leakage |
The usage of biogas digesters locally didn’t result in a rise in deforestation in different communities or elsewhere. Therefore, the venture doesn’t trigger leakage, i.e., a rise in emissions elsewhere. |
Annex B
Membership of the Worldwide Advisory Panel for Carbon Credit (IAPCC)
|
No. |
IAPCC Members |
Designation |
|
1 |
Prof Bertil Andersson [Chairperson] |
President Emeritus, Nanyang Technological College (NTU) |
|
2 |
Ms Catherine McKenna |
Chair, United Nations Excessive-Stage Professional Group on the Internet-Zero Emissions Commitments of Non-State Entities |
|
3 |
Prof Koh Lian Pin |
Affiliate Vice President and Chief Sustainability Scientist, Nationwide College of Singapore (NUS) |
|
4 |
Ms Patricia Espinosa |
Chief Govt Officer and Founding Companion, Onepoint5 |
|
5 |
Ms Usha Rao-Monari |
Former Underneath-Secretary-Normal and Affiliate Administrator, United Nations Growth Programme (UNDP) |
|
6 |
Ms Yuki Yasui |
Regional Director of Asia Pacific, Glasgow Monetary Alliance for Internet Zero (GFANZ) |
Annex C
Factsheet on ICCs and Article 6
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Determine C-1: Life cycle of ICCs Article 6 1. Article 6 of the Paris Settlement units out the framework for nations to voluntarily cooperate to attain their Nationally Decided Contributions (NDCs) and advance international local weather motion and ambition. As a substitute-energy deprived nation with restricted home mitigation potential, Singapore is keenly exploring cooperation on carbon markets. 2. The foundations and pointers below Article 6 facilitate the switch of carbon credit between nations, and was finalised on the 26th United Nations Local weather Change Convention (COP-26) in November 2021, following negotiations co-facilitated by Singapore and Norway. Underneath the Article 6 guidelines, the switch of carbon credit between nations requires corresponding changes to be made to every nation’s nationwide greenhouse gasoline stock. Corresponding changes stop the double-counting of emissions reductions in the direction of each the customer and host nation’s NDCs [2]. 3. Article 6 additionally doesn’t permit the usage of carbon credit that characterize emissions reductions or removals that occurred exterior of the present NDC interval. As an instance, as nations’ 2030 NDCs embody the years 2021 to 2030, nations ought to not commerce carbon credit that characterize pre-2020 emissions reductions or removals. 4. In compliance with Article 6 guidelines, Singapore’s Eligibility Standards require ICCs to be authorised by the host nation for corresponding adjustment, and characterize emissions reductions or removals that occurred between 1 January 2021 and 31 December 2030. |
[2] Corresponding adjustment is the switch of emissions reductions throughout nations’ greenhouse gasoline stock. For instance, when Nation X (purchaser) receives 5 tonnes of carbon dioxide equal (tCO2e) of carbon credit from Nation Y (host nation), Nation Y (host nation) has so as to add 5 tCO2e to its greenhouse gasoline stock whereas Nation X (purchaser) will cut back 5 tCO2e from its greenhouse gasoline stock.
