Singapore carbon exchange restores sale of credits of Cambodian project after human rights review
Move comes after standards body Verra announces it has reinstated the venture to its registry
AIR Carbon Exchange (ACX) will restore the sale of carbon credits from a Cambodian carbon project to its spot exchange, after carbon standards body Verra announced that it had reinstated the project to its registry.
There will be no differentiated treatment for sellers wishing to list Southern Cardamom credits for the standardised contracts on its spot trading platform, said Hum Wei Mei, ACX’s head of Asia-Pacific and head of carbon and environmental products, in response to queries from The Business Times.
The carbon exchange previously stated in June 2023 that it would no longer accept credits from the project – jointly developed by Cambodia’s Ministry of Environment and conservation organisation Wildlife Alliance – after its suspension by Verra following allegations of human rights violations.
Following a 14-month “thorough review”, the certification body said on Tuesday (Sep 10) that Wildlife Alliance had demonstrated that “it is taking the required actions to address all alleged harm, mitigate the risk of future harm, and continually improve the project”.
Wildlife Alliance welcomed the lifting of the suspension in a statement to the media, and added that it was already taking actions to improve communication between communities and forest rangers, engage pro bono legal support for communities, expand human rights training for rangers, as well as create a new community-managed fund for community development even before Verra’s review.
Suwanna Gauntlett, chief executive officer of Wildlife Alliance, said that the project – which is under the United Nations-backed REDD+ framework – is now in urgent need of funding for community livelihoods, scholarship awards and clean water infrastructure because of the 14-month suspension.
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“Now, with the hold lifted, we can continue to get essential investments to the communities who need them the most. Forest rangers are also in great need of funds for their daily forest protection operations to maintain their task of preserving the 450,000 hectares of threatened rainforest, stopping the bulldozers and apprehending greedy land grabbers who are endlessly causing damage,” she added.
While ACX had decided to suspend Southern Cardamom credits during Verra’s review, its rival Climate Impact X had previously said it is keeping them in its flagship standardised contract.
The standardised contract, known as Nature X, delivers carbon credits drawn from a pool of 11 forest-based carbon reduction projects around the world, one of them being the Southern Cardamom project.
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The credits could also have been sold on ACX’s market board platform, which allows sellers to transact with buyers at a chosen price. Hum said that this option facilitates sophisticated buyers of credits who might rely on their own judgement to assess suitability of credits.
Despite still being available for sale on some platforms, the price of Southern Cardamom credits has dropped following Verra’s review.
The price of each of these credits issued in 2000 was US$6.96 on Jun 19 – the day that Verra announced its suspension. It dropped to US$1.32 on Sep 11, based on data by price reporting outfit Quantum Commodity Intelligence.
While prices of voluntary carbon credits have been on the decline over the last two years after the industry had been hit by several scandals, credits from the Southern Cardamom project have suffered a worse fate with a price decline of about 81 per cent.
Carbon credits from the Katingan REDD+ project in Indonesia with the same vintage saw their price drop to US$4.40 from US$8.34 over the same period, a decline of about 47 per cent.
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