Are voluntary carbon markets more stringent in crediting than the clean development mechanism? : a comparison of public-private and fully private offsetting mechanisms’ ability to deliver environmental integrity using large-scale data

Abstract

Voluntary carbon markets (VCMs) have expanded substantially over recent years and are regarded by many as a promising new tool in the fight against climate change. They deliver emissions reductions by enabling mitigation projects to acquire carbon credits for their activities, which they can then sell onward to generate revenue. In itself, this basic concept is not a novelty, and when it has been applied in the past, e.g., in the Clean Development Mechanism (CDM), it frequently yielded unsatisfactory results. Sizeable uncertainty remains as to whether VCMs are superior to these pre-ceding systems, which is where the thesis at hand contributes. Using publicly available registry data from the CDM and two VCMs, Verra and Gold Standard, I analyse registered projects’ estimated annual emissions reductions with the help of descriptive statistics and multivariate regression. I find that, on average, VCMs do not credit projects with higher stringency than the CDM in a statistically significant manner, which is also supported by qualitative and descriptive analysis.