The Science Based Targets initiative (SBTi) expects a significant rise in demand for carbon credits, following the launch of an updated Corporate Net-Zero Standard. SBTi chief executive David Kennedy said companies that help fund carbon market development will gain greater recognition under the new framework, alongside rising standards of integrity.
Corporate representatives visiting a reforestation project supporting high-integrity carbon credits. AI generated picture.
The standard, known as CNZS2, introduces a ‘recognition mechanism for supplementary action’, allowing companies to use removal, reduction and avoidance credits alongside direct reductions in their own emissions.
Kennedy stated carbon credits cannot replace direct reductions in emissions. The two, he said, can work together. ‘For companies who see value in contributing and helping to develop those carbon markets, which are needed, then we will recognise it, we will give it a legitimacy, and that combined with the increasing integrity that we will have, and already have,’ he said. ‘Those two things combined will unlock significant demand for credits and high-integrity credits in particular through our ongoing emissions responsibility.’
Annette Nazareth, chair of the Integrity Council for the Voluntary Carbon Market (IC-VCM), welcomed the update, saying it would unlock further demand for removal, reduction and avoidance credits. ‘I can’t emphasise it enough how important it is, we believe, that the draft recognises something that many stakeholders have been discussing for years, which is that direct emissions reductions and mitigation beyond the value chain are not competing priorities,’ she said.
Read more: ISO opens consultation on first net zero standard
Michelle You, co-founder and chief executive of UK-based carbon removal marketplace Supercritical, said the update could generate demand for ‘hundreds of millions of tonnes’ of carbon dioxide removal a year within a decade. ‘So that is from a standing start of a million tonnes delivered to hundreds of millions,’ she added.
Nazareth described the SBTi’s approach as ‘highly complementary’ to the IC-VCM’s work as the leading supply-side integrity body for the verified carbon market. The updated standard ‘provides guidance on how companies should prioritise emissions reductions and how carbon credits can be used within a credible corporate climate framework,’ she said. The two organisations will ‘not be duplicating’ efforts, she added, since the SBTi plans to recognise standards that already exist in the space.
Kennedy said the SBTi will publish implementation guidance by the end of the year, including on the use of carbon credits. ‘We will recognise other organisations that are in the integrity space. We’re not going to invent integrity accreditation approaches ourselves where really good ones already exist,’ he said. The body will also publish guidance on energy certificates, including biomethane and sustainable aviation fuel certificates (SAFc).
Kennedy described a recently published draft net-zero standard from the International Organization for Standardization (ISO) as a ‘very useful complement’ to the SBTi’s framework. He does not see it as competition. The ISO has a ‘huge reach’ across corporates, he said, and the SBTi is working closely with it.
Read more: The new SBTi Corporate Net-Zero Standard: what it means for business
As demand grows for high-integrity carbon credits, the standards behind every credit matter more than ever. Green Earth develops large-scale, nature-based carbon projects accredited by leading international standards, with full oversight of every stage of the project lifecycle—from design and implementation to long-term monitoring and credit issuance. Our projects restore ecosystems, enhance biodiversity and improve community livelihoods, delivering verified environmental impact that stands up to scrutiny. For businesses meeting their environmental goals under frameworks like the SBTi’s updated standard, that integrity is what counts.
