When it comes to evaluating nature based solutions in carbon markets, the primary metric is the amount of avoided or sequestered carbon dioxide, as this is the critical currency on the path to net-zero emissions. However, benefits of carbon offsets go beyond emissions reduction and removal, as many projects come with a wide array of so-called “co-benefits.” Co-benefits are any positive impacts, other than direct GHG emissions mitigation, resulting from carbon offset projects. Academic research highlighted by ICROA reveals that every tonne of CO2 offset does not only fund carbon emission reductions, but can deliver up to $664 in additional economic, social and environmental benefits.
Co-benefits can be key drivers of corporate decision making when it comes to offset buying and broader sustainability strategies, according to ICROA Programme Director, Sophy Greenhalgh. From a demand perspective, co-benefits increasingly become the deciding factor for corporations choosing between offset projects with a high environmental integrity level. To certify co-benefits, several “add-on” certifications are focused on the social and environmental impacts of carbon offset projects, such as the Climate, Community, and Biodiversity Alliance (CCBA). In an attempt to frame what sort of co-benefits project developers can claim, a survey of 144 projects by Forest Trends’ Ecosystem Marketplace in 2016 outlined co-benefits in several categories:
Out of those defined categories, the three umbrella categories are:
A major co-benefit in this category is improved biodiversity, which directly contributes to achieving Sustainable Development Goal (SDG) 15 and is focused on protecting life on land. Many of Flowcarbon’s projects fall within the category of Land-Use, Land-Use Change, and Forestry (LULUCF), which are currently one of the most popular types of carbon offset projects.
Common environmental co-benefits in these projects include:
The forest and land-use projects supported by Flowcarbon, including Reducing Emissions from Deforestation and Forest Degradation (REDD+), generate direct biodiversity benefits besides carbon sequestration. Helping to conserve forests through thoughtful and transparent projects with clear co-benefit guidelines helps maintain ecological balance in pollination, seed dispersal, and germination, as well as plant regeneration and growth. Forests protected through these projects also preserve wildlife, habitats, and protect plants that may face extinction.
Some of the top environmental co-benefits from projects supported by Flowcarbon are to:
Investing in a carbon offset programme can deliver a wide range of positive social and economic benefits for communities in and around project sites. For example, cookstove projects may help women to overcome socio-economic and health challenges associated with gender disparities as many women in the global south spend a significant amount of time preparing food for their families via open fire cooking mechanisms. Measuring social co-benefits such as increasing women’s participation in decision making and reducing unpaid domestic labor can be challenging, but some of the main carbon crediting standards have developed frameworks to foster more incorporation of gender based co-benefits. One example is the W+ standard by VERRA, which links co-benefits of women’s empowerment with carbon projects, developed in 2017.
Typical social co-benefits include improving:
Some of the top social co-benefits from projects supported by Flowcarbon include:
A third type of co-benefit of carbon credit projects is to strengthen and diversify local economic opportunities, which contributes to achieving the United Nations Sustainable Development Goal 8: "Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all." Employment opportunities created by carbon projects can include protecting reforested areas, managing agroforestry farms and engaging in opportunities like harvesting and sustainable agriculture. These roles expand a local community’s income stream and contribute to growing a sustainable economy that in turn fosters social co-benefits such as education opportunities. Research shows that high quality nature-based carbon projects can yield significant employment co-benefits, with reforestation producing up to $27 of co-benefits per tonne of carbon according to Gold Standard’s portfolio analysis.
Typical economic co-benefits include improving:
Some of the top economic co-benefits from projects supported by Flowcarbon include:
Sustainable development is rooted in low-carbon growth, new jobs, energy security, and environmental quality. Increasingly, corporate social responsibility strategies and ESG targets highlight those needs through carbon offsets by prioritizing carbon credits with well documented co-benefits. According to research from the American Forest Foundation, 29% of carbon credits buyers evaluate projects based on co-benefits and 26% on its commitment to diversity, equity, and inclusion, making carbon credits a “package deal” that includes effects on local communities. Carbon credits that include numerous SDG targets often trade at a premium, given that an increasing number of corporations prefer those in their portfolio as it demonstrates the organization’s wider positive impact to both consumers and investors.