Remarks by Under Secretary for Domestic Finance Nellie Liang on Voluntary Carbon Market Integrity

The speaker at the conference emphasized the importance of high integrity carbon markets in achieving climate goals. Secretary Yellen highlighted the need for creative and scaled use of all tools to combat climate change. The US government s Voluntary Carbon Markets Joint Policy Statement and Principles, issued in May, acknowledged the market s shortcomings in supply, demand, and integrity. The speaker focused on market integrity issues in voluntary carbon markets (VCMs) and acknowledged efforts around supply and demand integrity. Institutions like the Integrity Council for the Voluntary Carbon Market (IC-VCM) are simplifying the search process for high-quality credits. Credit standard bodies are updating methodologies, and carbon credit rating firms are helping buyers discern credits. The CFTC s final guidance for regulated exchanges allows industry-recognized standards to be used for evaluating carbon credits. The VCM Principles state that stakeholders should improve transparency and publicly available data of credit-generating projects and programs. The speaker suggested ideas to strengthen VCMs, such as developing interoperable data protocols for carbon credits and enhancing price transparency. The speaker noted that most transactions in voluntary carbon markets are over-the-counter (OTC), with pricing and transaction details often remaining confidential. The speaker called for market participants to consider the benefits of price and transaction transparency. The Treasury Department supports a high-integrity voluntary carbon market and will contribute expertise and convene power to help develop solutions to market integrity. The speaker concluded that with improved integrity and marketplace function, VCMs can reach their full potential. The speaker thanked the IC-VCM, VCMI, and GCMU for co-hosting the event and organizing the session.

Source: marketswired.com
Published on 2024-09-26

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