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Carbon Farming 101: What Are Carbon Offset Registries, and Why are They Important?

Written by Ryan Stockwell | October 07, 2022

What are carbon offset registries, and why are they important?

In simple terms, carbon offset registries ensure three things: 1) the highest level of quality and rigor in carbon credit production; 2) transparency in the standards and the process used to create the credits; and 3) independent verification of the credits before they are issued by the registry. These three factors give carbon credit buyers the confidence they need to know their investment is actually providing real and lasting environmental impact.

“Buyers need to have utmost confidence that what they're buying is going to be of the highest quality, and that they're getting their money's worth,” says Craig Ebert, President of the Climate Action Reserve, an independent registry that establishes scientifically rigorous processes, or protocols, for generating carbon credits. (Carbon by Indigo’s credits are issued by the Climate Action Reserve.) Carbon credits generated without a protocol will likely cause problems in the future for credit buyers, notes Ebert. If buyers or observers have doubts about any part of the process behind a carbon credit, then the value of that carbon credit is reduced. More importantly, credit buyers could potentially get accused of greenwashing, if their claims of carbon emissions reductions cannot be justified.

So just what is a protocol? In its simplest form, a protocol is a scientifically rigorous set of requirements that help define the process a project manager, in this case Indigo, must employ to ensure conformance. With registries, the protocol requirements include having a third-party verifier review the work.

In the ag carbon credit world, farmers may be hearing a lot about verification conducted by various carbon credit programs. Is verification the same thing as a registry-issued protocol? The simple answer is, no. Verification is simply a third-party review or audit. That review can be quite simple, covering just a few pieces of information; or complete, covering everything from reviewing documentation to measurement and quantification, and potentially physical site visits and farmer interviews. If the carbon platform is not using a registry protocol, then the verification process is quite limited. Simply put, verification is only as good as the process and information it is verifying.

As Ebert notes: “Precisely because we want to avoid that appearance of a conflict of interest, that independent third-party verifier will send us a verification report for every project that dictates the project developer followed the steps outlined in your protocol, and therefore they're deserving of issuing a certain quantity of credits.”

Ultimately, the value of registry-issued carbon credits lies in the reliability for accuracy, established through a rigorous process involving third-party experts, which allows buyers to have the confidence that the credits they purchase have the desired impact. “If buyers invest in carbon credits from the Climate Action Reserve, they are indeed getting one ton of reduction for every credit they're investing in. That confidence is fundamental to overcoming concerns that someone might be greenwashing or that the so-called reductions that are being achieved are actually not being achieved,” notes Ebert. The more a carbon credit platform improves accuracy and assures integrity in the system through adherence to scientifically established processes, the more that carbon platform will provide value to both buyers and sellers.