New framework launched to tackle permanence concerns

Quantum Commodity Intelligence – A prestigious UK university has teamed up with an environmental monitoring start-up and a blockchain platform to provide a new framework that aims to address impermanence issues related to storage in the carbon market.

Cambridge University, Geotree and Tezos have launched Cambridge PACT, which they say is a framework to directly compare nature based solutions for carbon storage, such as forest preservation or reforestation, on an equal footing with carbon capture and storage, geo-sequestration or any other offset project.

The partners said that growth in investment in robust nature-based derived offsets is currently insufficient to meet the financing needs of project developers.

"We believe this is in large measure because many would-be buyers are not convinced by current assessments of the additionality and permanence of NBS offsets, and struggle to make like-for-like comparisons of diverse offsetting products. Nature-derived credits consequently attract discouragingly low prices," they said.

The trio's framework links economic assessments of impermanence with remote-sensing methods for addressing additionality to determine what they call a Permanent Additional Carbon Tonne or PACT.

The framework combines assessments of additionality, potential leakage and permanence issues, such as from fires or droughts, to result in prospective offsets buyers being informed how many impermanent credits are needed to make a PACT.

The partners argue that using the framework for PACT offers a better alternative to current "intrinsically flawed" systems set up to deal with permanence concerns, such as buffer pools, which assume all carbon is effectively permanently stored once the project ends both monitoring and access to the buffer pool ceases.

Different types of offset projects can also be compared using the framework.

"The PACT framework enables this by explicitly and transparently capturing differences in the performance of projects and in the durability of the net drawdowns they generate," the trio said.

Discussions are already underway with several corporates active in the carbon market about potentially utilising the framework, Quantum understands.

More details on the PACT framework can be found here.