Rebuilding trust in the VCM with quality nature data

Posted on Friday, January, 26th, 2024

From Forest Carbon's nature data partner, Cecil

The voluntary carbon market (VCM) has been an important experimental sandbox for channelling private sector investment into nature-based solutions (NbS) – helping break ground on projects such as the Dryhope peatland restoration project in Scotland, Delta Blue Carbon Project in Pakistan and Australia’s Yarra Yarra Biodiversity Corridor

However, nature-based carbon credits have also come under intense public scrutiny for issues ranging from mis-quantification of carbon stocks to inconsistencies in credit quality among developers – see papers from Berkeley Public Policy and West et al (2023).

As is the case for any market where ecosystem services are traded, integrity is the bedrock of a trusted VCM. Despite early bullish predictions for growth, the VCM is now expected to shrink for the first time in seven years. The industry is therefore responding with efforts to drive transparency and define ‘integrity’ with initiatives such as the Integrity Council for Voluntary Carbon Markets’ Core Carbon Principles and the International Carbon Reduction and Offsetting Accreditation’s remodelled Accreditation Programme

Despite signs of progress through these initiatives, many supply and demand-side VCM stakeholders have concluded that transparent and credible data is needed to rebuild trust and confidence in the market. The issue is that much of the data landscape today does not yet deliver the rigour required to appropriately quantify nature. The reasons for this are twofold: data accessibility and technical complexity. 

Data accessibility 

There is a common misconception that the nature data required for meaningful decision-making is lacking or does not exist. Nature data does exist, but it is siloed and locked up in unstructured, semi-structured and/or incompatible formats. This is true for both manual and machine-generated sources of data.

Siloed data

Manually collected in situ data from field sampling, experiments and laboratory studies presents some of the most valuable and granular information available for monitoring the state of nature on the ground and advancing knowledge discovery. Yet this first-party data is often used only once and then locked away in proprietary systems that use unstructured formats e.g. project feasibility studies.

Other data exists in unconnected systems, such as emails, lab notebooks, and spreadsheets, as well as an array of third-party sources, such as research papers, government records, unindexed databases and technology solutions. All of these sources contain critical knowledge to quantify nature accurately but remain in siloed systems that lack interoperability (the ability to exchange information) for the end-user. 

The growing ‘nature tech’ domain is creating new sources of machine-generated data at scale from solutions such as satellite-based remote sensing, eDNA, bioacoustics and others. These new technologies are lowering measurement and monitoring costs and increasing the variety, frequency and volume of data available to nature markets – but all have their limitations. Accurately quantifying the components, interactions and processes of dynamic ecosystems requires an integrated, multi-dimensional and holistic view of nature. 

As the nature tech domain matures, producers and users of nature data must align on how to share and use each other’s data with the appropriate context and granularity fairly and responsibly. 

Unstructured/unformatted data

A carbon credit project design document is a good example of how valuable data is locked up. A project design document aggregates environmental, geospatial, financial, legal and even political data points collected from project stakeholders and third-party service or data providers. However, this data exists in unstructured formats without machine-actionable metadata or essential context – meaning they can’t be reviewed effectively, re-used with confidence or interrogated for biases and errors. 

Technical complexity

It is important to remember that natural ecosystems are profoundly complex and not easily measured. They are made up of many components, be they physical, geographical, chemical or biological, that interact with each other over space and time. These varied interactions are also impacted by climate and human land use - therefore making the process of translating ecosystem dynamics and the impact of our interventions into numbers and metrics profoundly complex.

Furthermore, approaches for measuring concepts such as carbon emissions and biodiversity are a live science that is constantly being iterated upon by academic researchers across the globe. As such, nature and climate tech are constantly adapting and responding, both to the science and to advancements more generally.

Better tech means better data and insights, but only if the infrastructure and skills are there to match it. Keeping pace with a constantly changing industry has proven challenging for businesses; the evolution of remote sensing techniques and their application in conservation is a prime example. Since the first multispectral satellite data became publicly available in the 1970s, the science of mapping and monitoring nature using this technology has evolved rapidly – dramatically improving spatial resolution and even combining satellite-based remote sensing data to increase data densities. However, insights from these breakthroughs were and still are slow to make it to the frontline of conservation due to a lack of upskilling and insufficient data capacity.

VCM custodians must prioritise the development of adequate data skills and/or choose platforms which make learning new tech simpler. This will allow them to leverage the power of these new technologies and transparently communicate impact with confidence. 

A pathway to progress 

In 2023, Science magazine published a study that suggests six of the nine planetary boundaries have now been transgressed. The need for real and verifiable action on climate and nature is urgent and we know that nature-based interventions play an important role in achieving Paris Agreement goals. 

Quality-focused teams, such as Forest Carbon, are on the ground scaling restoration activities and driving private sector investment into nature. Forest Carbon works with some of the most robust credit methodologies available – its woodland schemes are certified by the UK government’s Woodland Carbon Code as accredited by the International Carbon Reduction and Offsetting Accreditation. Its peatland schemes are certified by the International Union for the Conservation of Nature’s Peatland Code

Forest Carbon’s commitment to integrity also extends to its approach to data. To increase transparency, they are working with Cecil’s nature data platform to manage and improve the data collected for its woodland and peatland projects in line with a science-based approach. Forest Carbon also continues to explore alternative sources of nature data to complement its rich first-party datasets, so that it can better understand risk and maximise the impact delivered by its growing portfolio. By investing in a robust, nature data management system, they are increasing visibility over their internal business operations, whilst also revealing asset-level insights which can be shared with financiers and other project stakeholders. 

The VCM is evolving. Technology has a role to play in delivering modern data capabilities to raise the bar on the market’s rigour and transparency. Data-driven nature-based project delivery can not only rebuild trust with the public but more importantly, help teams regenerating the planet’s natural ecosystems scale their impact. 

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