How Indigo Aligns with the US Federal Principles for High Integrity VCM

On Tuesday, May 28th, the US Federal government released the Voluntary Carbon Markets Joint Policy
Statement and Principles. This document marked an important message from the Biden-Harris Administration to the global voluntary carbon market (VCM), clearly stating that there is interest across different agencies in supporting the successful functioning of the VCM through the adoption of clear standards for quality and integrity. Prior to this, US government actions have been limited to individual agencies, such as efforts from the USDA and the CFTC.

This statement of principles was launched at an in-person event in Washington DC that included Treasury Secretary Janet Yellen, Agriculture Secretary Tom Vilsack, Energy Secretary Jennifer Granholm, Senior Advisor John Podesta, and National Climate Advisor Ali Zaidi, as well as a panel discussion that added private sector, NGO, and even farmer voices to the mix.

While the principles laid out in the joint statement are not particularly groundbreaking, they show the US government adopting a rational approach to encouraging high integrity climate action through the VCM. Indigo applauds this effort and we are excited about the prospect of clear, simple principles providing a framework to elevate good efforts and discourage investment in low quality actions. The 7 principles can be grouped into three categories: supply, demand, and market function:

So how well do Indigo’s carbon credits align with these principles?

Supply-Side Principles

1. Carbon credits and the activities that generate them should meet credible atmospheric integrity standards and represent real decarbonization.

Indigo’s carbon credits are issued by the Climate Action Reserve following independent verification against the requirements of the Soil Enrichment Protocol (currently version 1.1). This process and these standards ensure that our credits are of the highest integrity and are real, additional, permanent, verified, enforceable, do no harm, and are transparently issued and tracked in a public registry. CAR is a nonprofit organization with robust governance and a long history of developing the most rigorous standards in the VCM, as evidenced by their approval or endorsement by the International Carbon Reduction and Offsetting Accreditation (ICROA), California Air Resources Board (CARB), the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA), and the Integrity Council on the VCM (ICVCM).

2. Credit-generating activities should avoid environmental and social harm and should, where applicable, support co-benefits and transparent and inclusive benefits-sharing.

The practices being adopted by farmers participating in Indigo’s sustainability solutions support improved soil health over time, improved water holding capacity, reduced erosion, reduced chemical inputs, and increased diversity of crops as well as the soil biota. Farmers participating in the Carbon program also must maintain compliance with all applicable environmental regulations.
Finally, our Carbon and sustainable sourcing programs leverage the market for voluntary, corporate climate finance to support farmers in the transition to more sustainable agricultural systems. This results in significant benefits to rural economies and can offer a stable revenue stream to help farmers weather the variability of commodity markets and weather.

Demand-Side Principles

3. Corporate buyers that use credits (“credit users”) should prioritize measurable emissions reductions within their own value chains.

Indigo credits have been purchased by a diverse array of companies that are all demonstrating sustainability leadership in various ways. This is not unusual, as companies that purchase carbon offsets are generally more likely to be ahead of the pack when it comes to investing in reducing their own emissions!
But also, beyond the purchase of carbon credits, Indigo’s sustainable sourcing programs are helping companies in the food, feed, fiber, and fuel sectors to reduce the impact within their own supply chains by paying premiums for crops from growers that are reducing emissions and removing carbon from the atmosphere.

4. Credit users should publicly disclose the nature of purchased and retired credits.

The Climate Action Reserve’s offset registry makes it possible for the general public to review retirements of Indigo credits. While some buyers have chosen to remain anonymous, it is increasingly common for buyers to choose disclosure.

5. Public claims by credit users should accurately reflect the climate impact of retired credits and should only rely on credits that meet high integrity standards.

Indigo’s credits have been purchased by a wide variety of different companies, at different stages of their sustainability journeys and in support of different types of goals, from simply investing in high quality nature-based credits to specific, product-level carbon neutrality claims. In any case Indigo provides transparent, comprehensive documentation for users to support and communicate about their impact claims. The CAR standards and protocols ensure that every credit represents one additional tonne of carbon dioxide equivalent either removed, reduced, or avoided.

Market Function Principles

6. Market participants should contribute to efforts that improve market integrity.

Indigo has been an active participant in efforts to improve market integrity and generally enable the scaling of high quality agricultural soil projects. We do this through a variety of different channels and methods:

7. Policymakers and market participants should facilitate efficient market participation and seek to lower transaction costs.

With every annual reporting cycle of our carbon project we have refined and improved the data collection process and overall grower experience, reducing the effort of participation, while also driving improvements in the science and modeling, as well as increases in the credit price, thus increasing the upside for participating farmers. We have also built a significant network of partners on the ground who work directly with farmers to deliver advice and assistance in the carbon program process. We seek not to cut corners and lower the standards, but rather to streamline and bring efficiency while also increasing the upside benefits in order to make sure growers get paid for the hard work they are doing for the environment and for the long term sustainability of their farm businesses. 

We applaud the publication of these principles by the US government and are excited to see this sort of cross-agency collaboration to move forward together and highlight how high integrity voluntary carbon credits can benefit both the environment and the US economy. The principles themselves are well-aligned with other, existing carbon market integrity guidelines and approaches. This coalescing around common concepts of quality and integrity, both on the supply and demand sides of the market, are important for building confidence and driving greater investment into immediate, scalable climate solutions such as climate smart agriculture.

Learn more about Indigo’s carbon credits and find resources for buyers on our website.