Keeping carbon markets honest

Verifiers and registries act as the accountants and bankers of the industry

 

As you begin to navigate emerging carbon markets, you will no doubt encounter new terminology and some confusing jargon. It’s got a language all its own! Two of the terms you may have heard are “verifiers” and “registries.” The best analogy we know comes from an entirely different industry – banking.

Verifiers: the carbon accountants

Simply put, verifiers are the accountants of greenhouse gases. Like an accountant confirming the financial books are accurate, verifiers check that reductions claimed in a program like RegenConnect are correct. Verifiers don’t make the rules. They’re trained by carbon standards and the International Organization for Standardization (ISO) to follow specific principles and requirements of greenhouse gas verification.

Verifiers review every aspect of a greenhouse gas reduction project, from the initial project design and data collection method to the equations used to calculate the amount of emissions reduced. To receive carbon credits, a project developer like Cargill must hire a verifier and receive verification. Verifiers are third parties, meaning they have no interest in the project one way or the other. Their job is to check everything and attest that it is correct or that corrections need to be made.

Registries: the banks of the offset world

Registries are like banks, but for carbon credits instead of money. Like a bank stores money, a registry stores carbon credits. Once a greenhouse gas project developer – like Cargill – has  gone through the development and implementation process, and had it approved by a verifier (see above), the offsets are issued by a carbon “standard,” such as Verra, into the standard’s registry.

Issuing offsets converts one ton of verified, reduced CO2 into one verified carbon offset, otherwise known as a credit or unit, which can be sold. When all is verified, the carbon standard updates the registry to show credit in the project developer’s registry account for, say, 1,000 tons reduced. The account would then read: 1000 verified carbon credits. The project developer can then request to transfer the carbon credits to another company’s registry account, hence the market part of the carbon market. The purchasing company can then retire the credit in the registry, signaling it is counting that reduction for its climate goals. Once a credit is retired, the lifecycle of the credit is complete.

How does Cargill interact with verifiers?

Cargill interacts with verifiers as a customer of their verification service. When Cargill develops a carbon credit project, we have to complete the verification step to receive credits in the registry. Verifiers are the gatekeepers of that step and will attest that Cargill’s methods and calculations are true and accurate—or not. If verifiers find a mistake, they will suggest fixing it before proceeding. If the project developer refuses to fix the error, the verifier must attest that there is a mistake.

Keeping organizations honest

Verifiers do not interact directly with registries. Instead, verifiers are the important auditing step on the way to creating carbon offsets in the registry. Registries publish the verifiers’ reports for all to see. We can think about it like this: Accountants are to banks what verifiers are to registries. They both strive to keep organizations accurate and honest in their reports.