WASHINGTON — Jan. 9, 2025 | Verra announced today that the first batch of carbon credits associated with the 37 rejected rice cultivation projects in China has been compensated for. Compensation for the remaining 4 million credits is still outstanding.

In August 2024, Verra announced it had rejected 37 rice cultivation projects and imposed sanctions against the project proponents and validation/verification bodies (VVBs) involved in these projects. s.

The rejection followed Verra’s review, which found concerns with the methodology and the projects, and weaknesses in the validation and verification audits by the VVBs. It was determined that 25 of the 37 rejected projects had over-issued Verified Carbon Units (VCUs).

Since then, Verra has worked with two of the four project proponents—namely, Vitol (China) Energy Co Ltd and Timing Carbon Asset Management Co., Ltd.—which have successfully compensated for 480,000 VCUs across five projects.

However, a total of 4,080,000 credits are yet to be compensated for.

As a result, Verra has suspended the registry account of Search CO2 (Shanghai) Environmental Science & Technology Co. Ltd, which is responsible for 10 rejected projects and 2,220,000 outstanding credits. Their account will be closed if they do not compensate for the issuance of excess VCUs.

The remaining 1,860,000 credits pertain to 10 projects where the proponent is Hefei Luyu Agriculture Technology Co. Ltd. Hefei’s authorized representative, Shell Energy (China) Limited, had been representing these projects on the Verra Registry. However, Hefei and Shell terminated their communications agreement on September 11, 2024. As a result, these projects are no longer associated with an account holder on the Verra Registry (Hefei has never held a registry account). Consequently, Verra has moved the projects to an administrative account. Hefei has no further active projects and is not permitted to register new projects or open a registry account until compensation is completed.

"This was the first time Verra imposed such sanctions, demonstrating Verra’s commitment to greater integrity, transparency, and quality in the voluntary carbon market. Verra took decisive action at every level at which concerns were identified. Verra is committed to continual improvement of its standards programs, particularly as we address issues arising from inappropriate marketplace conduct."

Justin Wheler, chief program management officer, Verra

Verra is also in the final stages of its review of responses received from the four VVBs involved in the rice cultivation projects regarding the non-conformity reports Verra issued. Depending on the findings, Verra may suspend the VVBs’ ability to validate or verify projects in the future.

Contact:  

Media Inquiries: Erdem Koch | media@verra.org

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Verra is a global leader helping to tackle the world’s most intractable environmental and social challenges. As a mission-driven nonprofit organization, Verra is committed to helping reduce greenhouse gas emissions, improve livelihoods and protect natural resources by working with the private and public sectors. We support climate action and sustainable development with standards, tools and programs that credibly, transparently and robustly assess environmental and social impacts and enable funding for sustaining and scaling up projects that verifiably deliver these benefits.

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