- Verra disqualified 37 low-emission rice projects in China after a review revealed significant issues with emissions reductions.
- Verra has permanently deactivated the methodology used to calculate credits for these projects due to overstated emissions reductions.
- Global oil giant Shell, which used offsets from the disqualified projects, remains committed to ensuring its credits have a “verifiable carbon benefit.”
Verra, a U.S.-based registry for the voluntary carbon market, announced late Wednesday, August 28, that it had rejected 37 low-emission rice cultivation projects in China. The quality control review exposed significant issues with the projects’ emissions reductions.
The voluntary carbon market allows companies to buy credits to offset emissions and meet climate targets. However, the market has faced increasing scrutiny. Critics argue that many credits are “junk” and enable companies to engage in “greenwashing.”
Last year, the integrity of the Chinese rice projects came under question. These projects use alternative irrigation methods to cut methane emissions from rice fields. Verra discovered that the projects had overstated their size and emissions reduction potential.
As a result, Verra has permanently deactivated the methodology used to calculate the credits. This methodology allowed project developers to measure and verify emission reductions. With the deactivation, credits based on this methodology are no longer valid.
In an unprecedented move, Verra has ordered project developers to compensate for the excess credits issued. This decision followed the discovery of severe calculation failures. Farhan Ahmed, Verra’s Chief Programme Management Officer, said this action demonstrates Verra’s commitment to improving the integrity and transparency of the carbon market.
Shell, the global oil giant, will be affected by this decision. Shell used offsets from the Chinese rice projects to help meet its climate goals. The company has stated that it remains committed to ensuring its credit portfolio has a “verifiable carbon benefit.”
Rice production significantly contributes to greenhouse gas emissions, accounting for around 10% globally. Alternate wet and drying (AWD) techniques could reduce these emissions. AWD shortens the time rice fields stay submerged, cutting methane emissions.
New projects aim to use the carbon market to encourage farmers to switch to AWD. Verra is also developing a new methodology to calculate and verify emission reductions from these practices. This new methodology seeks to provide a more accurate assessment of the environmental benefits of rice cultivation projects.