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Summer U.S. Policy Roundup

Published: October 30, 2024 by Allyah Keith, The Climate Trust/Project Associate

After a seasonal hiatus, our weekly newsletter is back! Our team had a summer full of project site visits, conference presentations, connecting with other market participants, and reviewing methodology and policy updates. Our goal is to continue to provide you with the latest insights into carbon markets and climate solutions. Let’s start by taking a look at some timely policy updates:

Movement at the Federal Level

This summer marked a significant shift with increased participation from the federal government in supporting climate-smart initiatives. The White House and partnering agencies published the Voluntary Carbon Markets Joint Policy Statement, which serves as a guide outlining what market participants should uphold to promote market effectiveness. The guide emphasizes high integrity, real impact, and public disclosures- through seven criteria and its publication dovetails with Growing Climate Solutions Act (GCSA) developments.

The USDA solicited GCSA input via an RFI process regarding the establishment of regulatory guidelines for the Greenhouse Gas Technical Assistance Provider and Third-Party Verifier Certification Program. This monitoring will evaluate the protocols and methodologies in the Voluntary Carbon Market, ensuring ranchers, farmers, and forest owners have credible guidance and accessibility. The comprehensive list will include accepted programs that ensure “consistency, reliability, effectiveness, efficiency, and transparency”. The USDA also just closed an application period to establish an Advisory Council for the Certification program.

The Commodity Futures Trading Commissions (CFTC) published voluntary carbon credit derivative contract guidelines applicable to the designated commodity market in an effort to support transparency, liquidity, and integrity. Federal carbon market guidelines and program recognition should serve to bolster broader market integrity and transparency initiatives currently underway.

USDA Forest Service’s initiative to support landowners will make a significant impact through a series of Forest Landowner Support Program grants, made possible by the Inflation Reduction Act. The Service allocated well over $150 million to connect underserved and small-acreage forest landowners with emerging climate markets. These investments underscore the current administration’s commitment to ensuring carbon market access and funding is available to all US landowners.

ACR’s Revised Methodology

Finally, a major change in the market also included the American Carbon Registry‘s (ACR) substantial update of the Improved Forest Management on Non-Federal U.S. Forestland protocol. The main change from version 2.0 to version 2.1 is the revision of baseline requirements, making them dynamic and significantly more conservative.