Monday, February 6, 2023

Issuance of ART credits to Guyana a breakthrough for global carbon market, says Norway

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Norway’s Minister for Climate and Environment, Espen Barth-Eide, said the validation and issuance of certified carbon credits on the register of Architecture for REDD+ Transactions (ART) is a breakthrough for the emergence of a high-quality global carbon market to protect tropical forests.

He made this statement in a congratulatory message posted by Norway’s International Climate and Forest Initiative. Guyana is the first country to be issued carbon credits under a the new high-integrity carbon standard. ART issued 33.47 million legacy credits for carbon stored in the period 2016-2020. Norway said this marks an important step for how tropical forest countries can sell high-integrity carbon credits for preventing and reducing deforestation.

Guyana is the first country to conclude the ART process out of 15 jurisdictions that have so far entered the ART pipeline.

Following the recent announcement of the issuance by ART, the Guyana government and Hess Corporation announced a deal for the international oil company (IOC) to purchase 37.5 million credits, expected to be accumulated between 2016-2030, over the period 2022-2032. The deal is valued at least US$750 million.

Eide said, “It is great to see Guyana fulfilling its vision from 2009, to mobilise international private capital in support of its Low Carbon Development Strategy. Norway is proud to have been a partner of Guyana in this journey.”

Norway and Guyana had worked together first on a similar forest conservation initiative. The country supported Guyana with US$220 million for maintaining low deforestation rates. Norway noted that this was the first international commitment of support to the Low Carbon Development Strategy (LCDS) developed by Guyana. The money went toward funding initiatives included in the strategy, such as climate adaptation projects and programs to strengthen the rights of indigenous groups.

Guyana’s more than 18 million hectares of rainforests (almost one and a half times the area of England) are estimated to store approximately 20 billion tonnes of carbon dioxide equivalent. The forests cover most of Guyana’s landmass. It plans to maintain 99.5% of its forests.

In a similar congratulatory message, the Wildlife Conservation Society (WCS) pointed out that this is not only the first time a country has been issued carbon credits, but also the first time a jurisdiction with high forest cover and low rates of deforestation has the potential to access carbon market finance at scale.

“This is huge,” said Joe Walston, Executive Vice President for WCS Global Conservation. “Guyana’s issuance of the world’s first market-oriented jurisdictional REDD+ credits through the ART TREES standard is a testament to its commitment to pursuing equitable economic development through the safeguarding its forests. We must prioritise global support for countries and jurisdictions that follow this approach.”

Vice President Dr. Bharrat Jagdeo has said that the purchase by Hess Corporation amounts to 30% of the credits Guyana has to offer.

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