Setting the Standard: Verra’s Revolutionary New REDD Methodology

Deforestation currently makes up 12 to 20 percent of global greenhouse gas (GHG) emissions and keeping forests standing is a fast and cost-effective way of contributing to urgently needed, impactful climate action. Financing this solution is of the essence, and REDD+, since its inception, has served as a revolutionary method of driving finance to the protection of standing forests. It has also empowered local communities to maintain these forests and their biodiversity, and can contribute to governments’ climate commitments under the Paris Agreement.

The new REDD methodology (VM0048 Reducing Emissions from Deforestation and Forest Degradation) and the new module for AUD activities (VMD0055 Estimation of Emission Reductions from Avoiding Unplanned Deforestation) will strengthen the VCS Program for issuing carbon credits to AUD projects.

In an important step toward meeting national climate action goals, which is a central topic at the upcoming COP28 in Dubai, VMD0055 involves collaboration between Verra and national governments and enables project baselines to be derived from jurisdictional REDD baselines.

The new module for AUD activities employs a cutting-edge, high-integrity approach to setting project baselines, which are used to calculate a project’s emission reductions. Going forward, Verra will lead on establishing project baselines. Data for these baselines will be sourced from high-quality service providers, in compliance with stringent accuracy requirements. The data collection process will incorporate sophisticated technologies, such as satellites and remote sensing, as well as ground-truthing.

VMD0055 will allow the carbon accounting of all AUD projects in a jurisdiction (e.g., national or first subnational unit) to be proportionate to the total deforestation in that jurisdiction and will factor in carefully analyzed deforestation risk information.

Project baselines will no longer use reference regions to project future deforestation, reducing the potential for any perceived or actual conflict of interest at the project proponent level. Instead, Verra will allocate deforestation data directly to projects.

VMD0055’s new baseline approach includes the following key features:

• Baselines are calculated based on a single deforestation dataset for a given jurisdiction established and approved by Verra, following stringent requirements.
• Verra allocates baseline data to projects based on an assessment of deforestation risk in their project area. This allows for the number of verified emission reductions of all projects in this jurisdiction to be proportionate to the total of potential emission reductions in that area.

A key to implementing this new baseline approach will be the release of the revised VT0007 Unplanned Deforestation Allocation Tool. This new digital version of the tool includes a procedure for developing risk maps for jurisdictions where REDD projects registered in Verra’s VCS Program are located. Verra is conducting final testing of the tool using the first sets of activity data gathered and expects to release the tool, along with requests for proposals for risk mapping providers and for risk mapping data layers, in Q1 2024.

This new approach to providing allocated baselines for VCS AUD projects is not intended to replace or question government Forest Reference Emission Levels (FRELs). As Verra implements this new approach to baseline setting, it will engage with governments, use official data where possible, and share all final data with relevant government agencies.

Per the January 2022 VCS Program update (PDF), baselines must be reassessed every six years. Previously, baselines were reassessed every 10 years.

All current AUD projects are required to transition to the new methodology. As part of this transition, Verra is (1) inactivating two of its current AUD methodologies (VM0009 and VM0037) but certain projects currently “under validation” will have a limited window to complete the validation process (Verra will notify those project proponents who will be affected) and (2) updating one methodology (VM0007) so it continues to be available for AUD projects under certain conditions, for a limited time. Two more methodologies, VM0006 and VM0015, will be updated in the near future (expected for Q1 2024).

Certain modules originally designed to be used with VM0007 (VMD0001, VMD0002, VMD0003, VMD0004, VMD0005, VMD0006, VMD0011, VMD0013, VMD0014, VMD0015, and VMD0016) have been updated to enable their use with VM0048. VMD0008, also used with VM0007, is being inactivated.

The exact timing of an AUD project’s transition to the new REDD methodology will depend on (1) the current status of the project and (2) the availability of activity data for the jurisdiction in which a project is located.

For details on transitioning an AUD project to the new REDD methodology, see the “Transition Process by Project Status” webpage on the Verra website.

Verra anticipates that data for all jurisdictions with existing REDD projects will be available by January 1, 2025.

Because Verra will incur the additional costs for baseline setting under this new methodology, we will institute a new fee to cover these costs. We expect this fee to be lower than the historical costs of baseline setting. More details will be available in a new fee schedule (expected for Q1 2024).

The release of the new REDD methodology and AUD module follows a three-year process that included multiple rounds of expert review and public consultations. We would like to sincerely thank all stakeholders who contributed to this process!

The publication of VM0048 and VMD0055 contributes to the “Enhanced Program Integrity and Impact” thematic area under Verra’s “New Era for Verra” initiative.

Verra led the development of the methodology and module with support from Tim Pearson (Green Collar), Kevin R. Brown (Wildlife Conservation Society), Simon Koenig (Climate Focus), Till Neeff, Sarah M. Walker (Wildlife Conservation Society), and Lucio Pedroni (Carbon Decisions International). Juan Felipe Villegas (Carbon Decisions International), Igino Emmer (Silvestrum), Rebecca Dickson and David Shoch (TerraCarbon), and J. Ronald Eastman and Robert Gilmore Pontius Jr. (Clark Labs), and Manuel Estrada made significant contributions.

As announced previously, Verra is committed to providing projects with a pathway for obtaining the Core Carbon Principles (CCP) label for historically issued VCUs. Such a pathway would allow for projects to transition to a new methodology version that has been approved by the Integrity Council for Voluntary Carbon Market (ICVCM) and apply this methodology retroactively to past issuances.

Verra will soon issue a guidance document with specifics on how to pursue this pathway. For REDD projects, this guidance would include information about gathering the necessary data and approaches for their retroactive application.

By the end of 2024, Verra plans to release additional modules for addressing other aspects of REDD, such as avoiding planned deforestation (see the request for proposals related to avoiding planned deforestation). These modules will also be used together with VM0048.

On Tuesday, December 19, 2023, at 11:00 am ET, Verra hosted a webinar to provide an overview of the new REDD methodology and the module for AUD activities.