South Pole, GenZero launch Asia centre for carbon project development

SUSTAINABILITY consultancy South Pole and its investor GenZero have launched a Singapore-based hub to develop carbon projects relevant to the region, such as the early retirement of coal power plants and the development of green shipping.

The hub, called the Asia Centre of Carbon Excellence (ACCE), is supported by the Singapore Economic Development Board. Its formation was announced at the Ecosperity sustainability conference on Wednesday (Apr 17).

Singapore has a big role to play in the implementation of Article 6 of the Paris Agreement, under which countries trade carbon credits to meet their carbon-reduction targets, South Pole and GenZero said. The ACCE will collaborate with regional companies and governments to explore opportunities for carbon project development in Asia and globally. This will enable clients to meet their emission-reduction targets cost-effectively, said the two parties.

Its projects include the:

• Early decommissioning of coal power plants;

• Development of green shipping, green hydrogen and green ammonia;

• Spurring the adoption of carbon capture and storage technologies; and

• Supporting the roll-out of carbon-pricing instruments, such as the European Union’s carbon border adjustment mechanism.

John Davis, interim chief executive of South Pole, said: “Public-private sector collaboration is the only way we will meet our climate goals under Paris, and ACCE exemplifies the best of this model.” He added that his team will work to boost Asia’s leadership in international carbon trading and mitigation.

Another Asian project that South Pole is working on is the Coal to Clean Credit initiative with the Rockefeller Foundation.

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The initiative, with a project in the Philippines, involves the use of carbon finance to accelerate the early retirement of coal power plants, and to replace them with renewable energy.

GenZero chief executive Frederick Teo said that carbon markets will play an important role in Asia’s green transition. “We need capabilities to develop new carbon credit methodologies and innovative approaches to accelerate decarbonisation, especially those with greater relevance in Asia,” he added.

Lim Wey-Len, executive vice-president at the Economic Development Board, said that the Asia-Pacific has “significant untapped potential to pioneer innovative decarbonisation pathways”.

Rocky market

The ACCE’s establishment, however, comes as the carbon credit market continues to be rocked by credibility issues. South Pole itself last year faced heat over its involvement in the Kariba Redd+ project in Zimbabwe. Media reports alleged that the project did not preserve as much of the forest as was claimed, nor did it benefit local communities. South Pole terminated its involvement with the Kariba project in October last year. In February, it announced that a new chief executive, Daniel Klier of sustainability data platform ESG Book, would replace Davis in May.

Asked about the credibility issues surrounding carbon credits, GenZero’s Teo said that the issue is more about governance. He noted that the carbon market is not as mature as conventional financial markets, which have known regulators and international standards.

“I think we do need to have a little bit of time to get to that level of governance, where the authority will rest on a body that will be broadly acknowledged by everyone to be the ultimate arbiter… We may not be quite there yet, but I think that there are bright spots,” he added.