Blog

Reflections from Innovation Zero

3 May, 2024 | Alice Flynn
Categories: Carbon Offsetting, Conferences

By Rachel Brooks

This week, Tom and I had the refreshing opportunity to get out and about and rub shoulders with many of our colleagues from across the sector at the inaugural InnovationZero conference in London Olympia. Thank you to everyone who reached out to us over the course of the event, and to all who took the time to speak with us.

We came away with a lot to think about, uplifted by the buzz and optimism surrounding the innovations on show. We had a real sense that many of the changemakers who will be at the forefront of the global paradigm shift to a nature positive, zero carbon future were there with us in the room. The talent and commitment to action shown by this group speaks a strong message of, dare I say, hope, overriding the repetitive narratives commonly spoken by our policy leaders and institutions; a potent antidote to the stifling alarm that can frequently overcome us when we hear the latest from the scientific community on the relentless march of climate change.

If there was one thing I took away from the event, it’s the importance of multiplicity in solving this great challenge we face. There’s not one solution that’s better than another, no silver bullet (back to cliches), it’s the everything, everywhere, all at once theory of change that will get us to where we need to be. The VCM alone will not solve climate change, but it will play a part. Similarly, whilst there’s no Net Zero without carbon removals, we will still be needing avoidance (credits) for many years to come, because we will keep needing to avoid emissions, and we will keep needing to incentivise this. We, and others, would do well to keep this in mind when evaluating ‘solutions’.

My key takeaways on the state of the VCM:

  1. Risk mitigation is key to engaging stakeholders and building trust in the VCM, in turn required for fair and stable pricing. Fortunately, this space is abuzz with activity, from innovations in digital MRV tools, to the tokenization of data – and hence credits – via blockchain, paving the way for high integrity, transparent impact reporting.
  2. With the (much needed) rise of integrity markers and carbon credit rating agencies, off-takers need to be comfortable trading credits without an ‘A’ in their rating; this is not without precedent – the bond market is just so.
  3. The wine-glass analogy applies to the carbon market: a large volume of project owners and developers make up the body of the glass, supported by a large investor base. But the flow of capital and credits between the two (the stem) is the limiting factor: innovations are still needed to widen the stem and connect projects with suitable investors. Shout out to Vuelta Carbon who are tackling this problem head on.

And Tom’s reflections:

  1. There is a real buzz around Removal credits (CDR, CORCs etc). Great to experience first hand the groups of pioneering organisations / implementors alongside VCM folk who are paving the way for these projects to happen and facilitate funding. 
  2. That said, discussions with newer market investors often have a preference towards removal projects, yet we see a significant opportunity for keen CDR investors to widen their investment scope into avoidance projects alongside. These projects often face less scalability issues, will generate credits much faster and will have a huge role to play for nations to meet their Paris agreement commitments with an enacted Article 6.

And one final message to reflect on:

  • Diversity in representation leads to diversity of solutions, whether at the project level or boardroom. Getting a wider breadth of stakeholders to the table is itself a powerful driver of change, applicable to all projects, organisations, institutions and especially flows of capital (though Shanya Harris from Supply Change Capital articulated this far better than me).

Thanks to all those who were a part of the event. We look forward to welcoming all our new connections to join us on our common journey to achieving high impact carbon mitigation -that’s right, removals and avoidance.