In an interview with Environmental Finance, Dougal Heap, Head of TBS at ecosecurities, argues that the integration of technology-driven solutions could bolster the credibility of the voluntary carbon market and serve as a key factor in shaping the Article 6 mechanism set to be discussed at COP28.
Source: Carbon Engineering
Technology-based solutions (TBS) are projects that directly extract carbon from the atmosphere, and include carbon capture and storage, bioenergy storage, biochar and enhanced weathering.
"They're currently a small fraction of the market, and we're currently in a growth stage" Dougal Heap, head of technology based solutions at Ecosecurities, told Environmental Finance. He added that "everything [the market is] learning now, will save us money when we're doing it on a bigger scale".
These are still relatively new technologies, which leads to challenges when it comes to calculations and verification. "It's not necessarily more difficult than calculating the avoided emissions from a REDD+ project," he said, but because of its novelty "we have to be very conservative" in our calculations.
There has been major criticism of the nature-based solution carbon credit market over the past year, particular forestry projects and the REDD+ methodology, which Heap said can "push people in the other direction as a reflex".
While he admitted that "as with all methodologies, it's about doing it well, and using quality data, and making sure you ground the truth in all the numbers", he argued "there's an opportunity for [TBS] to be seen as a more certain carbon credit" than some others available in the market.
Technologies such as Direct Air Capture, for example, easily show how much carbon has been sequestered, and projects such as biochar can 'lock-in' carbon underground for the long-term – helping to overcome concerns about the short-term nature of some carbon credit projects.
Corporates could also be more keen to use TBS carbon credits, as they can often be more closely related to their actual activities – especially for those in engineering, manufacturing and technology-based industries. He said "this mean they're more tied into it, and it's more relatable".
Despite this, Heap argued that TBS and nature-based solutions should not be "pitted against each other". "There are many more synergies and things in common than I think people realise – as well as their own strengths and weaknesses," he said.
"There are opportunities for them to fill the gap of the other, by being implemented together and having a foot in both camps. That's something that will be more present in the future, because it's unnecessarily siloed at the moment", he concluded.
Heap predicted that TBS could play a major role in the Article 6 mechanism. This is a framework for countries to cooperate with each other to achieve their Nationally Determined Contributions (NDCs) under the Paris climate agreement, either through bilateral agreements or a market-based mechanisms. The latter market's rules are still being developed.
"It's unlikely these TBS will be in countries' unconditional NDCs, and so that means there's a great opportunity for generating carbon credits in these countries as part of the Article 6 mechanism", he said.
Many countries have indicated that nature-based solutions, which make up the majority of the voluntary carbon credit market, are "not the target" for Article 6-approved activities, because they're "the lowest hanging fruit", Heap said.
"Countries have been publishing a list of approved activities" such as India, and "it would be great if some of these TBS were included", he argued.
He admitted, however, that many might not include TBS in their list of approved projects because "they're not aware of them – so there's definitely education still needed".
Education is also required on the operation of the projects, as there is a perception that these will only take place in Europe or the US, typically where the technology "happened to be developed". However, "there's no real reason for this", he said, arguing that it should come down "to the availability of biomass or geology, or generally natural factors. It should be able to go where's best suited".
Heap added that the benefits to communities involved also needs further promotion. "Many of these solutions are an opportunity to contribute to development" through employment or skills training. It means "the societal benefits can be huge, so there should be just as much willingness for a TBS as there is for a NBS".
Ecosecurities recently won three Environmental Finance voluntary carbon market awards. Read more here.