How businesses can contribute to carbon sequestration

As the Inter­gov­ern­men­tal Pan­el on Cli­mate Change (IPCC) remind­ed us in 2018: lim­it­ing glob­al warm­ing to +1.5°C by 2100 will require a rig­or­ous decrease of our emis­sions but also the devel­op­ment of mea­sures to increase car­bon seques­tra­tion. Yet, it should be not­ed that only car­bon seques­tra­tion poten­tials asso­ci­at­ed with the use of bioen­er­gy with car­bon cap­ture and stor­age (BECCS) as well as plant­i­ng new trees were con­sid­ered in these models. 

Accord­ing to Cli­mate Action Track­er, we are cur­rent­ly still on track for a rise in tem­per­a­ture of 2.7°C–3.1°C¹. In this con­text, var­i­ous recent pub­li­ca­tions high­light the cru­cial role of tech­no­log­i­cal² advances and nature-based solu­tions. Data sug­gests that, if imple­ment­ed, nature-based solu­tions could help reduce tem­per­a­ture by 0.4°C in a glob­al warm­ing sce­nario of +1.5°C by the year 2100³.

How­ev­er, these nature-based solu­tions would not be able to con­tribute this much in the case of a +3°C tra­jec­to­ry. Indeed, the capac­i­ty of car­bon seques­tra­tion in bio­mass would be altered by rise of tem­per­a­tures that is too high. And, con­trary to cur­rent mod­els, the range of nature-based solu­tions is much broad­er than just the use of BECSS and afforesta­tion (i.e. plant­i­ng trees). Oth­er nature-based solu­tions avail­able fall into three cat­e­gories: (1) con­serv­ing cur­rent car­bon stocks (e.g., by stop­ping defor­esta­tion), (2) restor­ing degrad­ed ecosys­tems, and (3) imple­ment­ing new prac­tices that store car­bon. In this arti­cle I will focus on this third solution. 

Increas­ing car­bon seques­tra­tion

As an exam­ple, imple­ment­ing new farm­ing prac­tices in the agri­cul­tur­al sec­tor, such as cov­er crops or reha­bil­i­tat­ing degrad­ed soils, would make it pos­si­ble to cap­ture approx­i­mate­ly 0.8GtCO2/year⁴ on a glob­al scale (com­pared to ~42GtCO2 emit­ted in 2017)⁵. Fur­ther­more, a nation­al-scale diag­nos­tic per­formed in France con­firmed the exis­tence of a max­i­mum poten­tial⁶ of 29 MtCO2/year – equiv­a­lent to 39% of French agri­cul­tur­al emis­sions in 2016 (exclud­ing land use). To roll this out on a nation­wide scale would involve imple­ment­ing new mea­sures such as extend­ing the use of inter­me­di­ate crops, agro­forestry prac­tices, adding tem­po­rary mead­ows and increas­ing the dura­tion of their use. 

More­over, vol­un­tary car­bon mar­kets are one of the main ways to pro­mote car­bon seques­tra­tion efforts. The word “mar­kets” is used in the plur­al because exchanges between project lead­ers and buy­ers are done at dif­fer­ent scales – either inter­na­tion­al or local. At the inter­na­tion­al lev­el, car­bon projects are backed by labels and record­ed in a reg­istry sys­tem to ensure the trace­abil­i­ty of cred­its and trans­ac­tions between sub-nation­al actors (com­pa­nies, pri­vate indi­vid­u­als…) locat­ed in dif­fer­ent regions of the world. 

Between 2018 and 2020, 401MtCO2 of car­bon cred­its were issued on the inter­na­tion­al vol­un­tary mar­kets⁷. The aver­age price observed for these car­bon cred­its, across all cat­e­gories, is 2.7€/tCO2 while projects involv­ing car­bon stor­age in the for­est indus­try hold the top posi­tion with an aver­age price of 7.5€/tCO2. These prices remain low, how­ev­er crit­ics often point out the lim­its of such invest­ments in these projects. Par­tic­u­lar­ly when they are used as an easy, low-cost way to demon­strate an ambi­tious cli­mate strat­e­gy with­out tak­ing sig­nif­i­cant CO2 reduc­tion measures. 

Mobil­is­ing car­bon label certifications 

One of the trends iden­ti­fied for vol­un­tary car­bon mar­kets by 2030⁸ is a rise in demand for local car­bon projects – mean­ing ini­tia­tives devel­oped in the buyer’s coun­try – which res­onate more with the expec­ta­tions of com­pa­nies. The price of car­bon cred­its com­ing from these mar­kets could vary between 40€/tCO2 and 75€/tCO2⁹ which would be more in line with the iden­ti­fied costs for the devel­op­ment of car­bon seques­tra­tion projects. This is par­tic­u­lar­ly true for the French agri­cul­tur­al. Half of projects would gen­er­ate costs esti­mat­ed at ~49€/tCO2. These pro­jec­tions are in line with the dynam­ics observed in recent years which show a rise of car­bon label cer­ti­fi­ca­tions at the nation­al lev­el in Europe but also on oth­er con­ti­nents¹⁰.

Thus, the devel­op­ment of cer­ti­fi­ca­tion labels, like the Label Bas-Car­bone in France, are a chance for com­pa­nies to explore poten­tial oppor­tu­ni­ties that already exist in their val­ue chains. These mech­a­nisms make it pos­si­ble for com­pa­nies to ini­ti­ate projects while han­dling poten­tial risks asso­ci­at­ed with these (non-per­ma­nence, addi­tion­al­i­ty, uncer­tain­ty). In oth­er words, it makes it pos­si­ble to take action, while pro­vid­ing a frame­work to make the most of these efforts. 

The advan­tages asso­ci­at­ed with an invest­ment in such projects are numer­ous: bet­ter upstream man­age­ment of the val­ue chain, a reduc­tion of emis­sions out­side a company’s strict perime­ter but still with­in its val­ue chain, con­tri­bu­tion to glob­al car­bon neu­tral­i­ty, strength­en­ing ties with raw mate­r­i­al pro­duc­ers and devel­op­ing a ter­ri­to­r­i­al foothold. Upstream knowl­edge of a company’s val­ue chain is also a pre­lim­i­nary step to face anoth­er chal­lenge: increas­ing its resilience in the face of cli­mate change, through adap­ta­tion measures. 

We must remain real­is­tic: the access to vol­un­tary car­bon mar­kets to sup­port the fund­ing of car­bon seques­tra­tion projects is not a mir­a­cle solu­tion to align all com­pa­nies on a track of 1.5 °C. Nonethe­less, this frame gives com­pa­nies the oppor­tu­ni­ty to strength­en their val­ue chain and to han­dle the risks asso­ci­at­ed with such prac­tices. This is part of a wider range of levers that com­pa­nies have at their dis­pos­al to begin the tran­si­tion towards a low-car­bon mod­el. We must cap­i­talise on this!