What is a CCP-labelled carbon credit?

The climate crisis demands urgent, innovative solutions. And climate action costs money. Addressing this challenge requires a paradigm shift.

We must move away from business-as-usual practices and identify all the impactful, sustainable tools and solutions available to us to reduce and remove greenhouse gas emissions. The voluntary carbon market (VCM) – if it is rooted in high integrity – is one such tool that has the potential to unlock untapped private finance.

To reach that potential, this finance must be directed towards projects that offer genuine impact and that would not happen otherwise. That’s where the Core Carbon Principles (CCPs) and CCP-labelled carbon credits come in. The CCP label denotes high integrity, raising the standard of carbon credits in the market, directing investments to people and initiatives that work for the planet.

Our work sits hand-in-glove with the Voluntary Carbon Market Integrity Initiative, which has developed a Claims Code for the credible use of carbon credits by companies.

We see this as the start of a new, reformed chapter for the VCM – with the rules now in place to help it fulfil its potential. This will drive a fresh surge of demand for high-integrity carbon credits – enabling companies to take responsibility for the emissions they cannot yet cut. Credits must, of course, only be used by companies as a supplement to, never instead of, deep value chain emissions cuts.

What is a CCP-labelled credit?

The CCPs were established to help increase the integrity of the VCM by setting a global benchmark for quality carbon credits.

CCP-labelled carbon credits will make it easier for buyers to ensure they are investing in a VCM that contributes meaningfully to reducing and removing greenhouse gas emissions, while supporting sustainable development goals.

To be tagged with the CCP label, carbon credits must undergo a rigorous assessment process. At the Integrity Council for the Voluntary Carbon Market, we assess carbon-crediting programs and Categories of carbon credit methodologies for adherence to the CCPs ten fundamental principles.

Only if a program is approved as CCP-Eligible and the methodology used to design and implement a project is labelled as CCP-Approved, can programs then issue CCP-labelled carbon credits. This is our ‘two tick’ process.

What makes a CCP-labelled credit high integrity?

The ten Core Carbon Principles establish a global benchmark for high-integrity and are similar to standards set by financial regulators. They set rules relating to a product – carbon credits – and to the carbon-crediting programs that issue them. 

A high integrity CCP-labelled carbon credit will deliver genuine emissions reductions: one credit is equal to a tonne of emissions reduced or removed. Where projects have social impacts, a CCP-labelled credit will also deliver sustainable development benefits that support Indigenous People and local communities (IPs & LCs).

To verify the emissions impact of credits, carbon-crediting programs need to ensure that the methodologies used to design and implement projects ensure that reductions or removals are additional (i.e., they would not have occurred without the incentive created by carbon credit revenues). They must also be permanent; measured robustly and conservatively; and verified by independent experts.

Furthermore, programs must guarantee that high-integrity credits come from projects with robust social and environmental safeguards that also deliver positive sustainable development impacts. For example, ensuring that projects assess and mitigate risks to IPs & LCs, securing their free, prior and informed consent, and being transparent about how benefits are shared.

The programs issuing the carbon credits must meet high standards of governance to establish the overall quality of carbon credits. This includes providing comprehensive and transparent information on projects issuing credits so people can understand their impact on emissions, society and the environment.

It is also essential that programs support the transition to net zero and do not lock in fossil fuel emissions or carbon-intensive technologies.

In addition, optional CCP Attributes will enable programs to highlight additional features that may be of interest to buyers:

• whether host country authorisation and a corresponding adjustment are applied;
• whether the project makes a voluntary contribution to the Adaptation Fund of the UNFCCC;
• whether the project quantifies a positive contribution to the UN Sustainable Development Goals.

How do CCP-labelled credits relate to climate and sustainable development goals?

To be CCP-Eligible, carbon-crediting programs must have clear guidance, tools and compliance procedures to ensure mitigation activities conform with or go beyond widely established industry best practices on social and environmental safeguards while delivering positive sustainable development impacts.

All new projects ensure climate finance raised through CCP-labelled carbon credits will support the UN Sustainable Development Goals.

High-integrity CCP-labelled credits will make it easier to channel climate finance to countries in the Global South, helping them achieve their national climate goals. This finance goes into a range of climate projects from action to protect and restore forests to scaling innovative clean technologies that are hard to commercialise.

CCP-labelled credits will:

• Adhere to a new, globally established benchmark: The carbon crediting programs issuing them have passed a rigorous assessment, as have the methodologies used in the projects from which the credits are issued.
• Build trust in the VCM: CCP-Eligible carbon-crediting programs have demonstrated their commitment to transparency, impact, and sustainable development, which reassures buyers, investors, and stakeholders that the credits they issue will deliver impact.
• Ensure good governance: The CCP principles for governance include requirements for transparency and verification by independent experts. Such governance measures are crucial for maintaining the quality and credibility of carbon-crediting programs.
• Effectively mobilise climate finance: Carbon credits with the label will attract funding for those projects capable of having substantive, sustainable impact, and help accelerate flows of finance to Global South economies and communities.
• Safeguard the rights of Indigenous Peoples and local communities: The CCPs include criteria establishing robust social and environmental safeguards, ensuring a VCM that protects and promotes the rights and livelihoods of Indigenous Peoples and local communities.
• Change global policies: The CCPs are gaining international recognition as the standard for high-integrity carbon credits. Policymakers, regulators, and financial institutions are increasingly looking to incorporate the CCPs as a framework into their policies and guidance.