The voluntary use of carbon credits in a context with rapid policy and legislative developments

Summary of Swedish capacity-building event

June 27, 2024

Event Overview

Swedish stakeholders gathered on 12 June 2024 to discuss and build capacity concerning the voluntary use of carbon credits in the context of a rapidly changing policy landscape. The digital event was organised by IVL Swedish Environmental Research Institute as part of a Nordic capacity building initiative supported by the Nordic Council of Ministers. It gathered around 70 stakeholders from across society including businesses, government agencies, NGOs, carbon market experts, academia and journalists etc. Participants were invited to listen to a number of presentations, participate in a Q&A session, and respond to a questionnaire.

The recording of the event is available in the Nordic Dialogue website. 

Key takeaways
  • Many companies and other types of organisations are taking action to manage and gradually reduce their climate impact. Many are considering the voluntary use of carbon credits in addition to ambitious in-value chain mitigation. However, international guidelines and standards as well as EU regulation are evolving rapidly and are challenging for many stakeholders to understand.
  • Regulation is gradually reducing options for legally making offsetting claims. So-called contribution claims are emerging as an alternative to offsetting, but the concept is relatively new and untested. Many stakeholders show an interest in contribution claims and want to learn more. 
  • Regulatory uncertainty surrounding offsetting claims will prevail to some degree until all relevant EU directives have been adopted and then transposed into national law in Member States and empirically tested.
  • Emerging guidance on beyond value chain mitigation provides stakeholders with best-practice approaches grounded in climate science and policy that enable organisations to take responsibility for the emissions still occurring while implementing robust action towards reducing the organisation’s carbon footprint.
  • There is a significant need for dedicated capacity-building to raise stakeholders’ awareness and capacity to make informed decisions. Many participants felt that the event had been useful and requested more of the same as the policy landscape evolves.
Highlights from the presentations and Q&A session
  • The Nordic code of best practice for the voluntary use of carbon credits was introduced to the participants. During 2021 to 2022, the Nordic Dialogue on Voluntary Compensation team and an extensive working group of Nordic stakeholders worked together to foster a common understanding of best practices for the voluntary use of carbon credits and co-create the Nordic code, which can be used as a foundation for making credible offsetting or contribution claims. Continued efforts to keep the inclusive process alive were encouraged by participants.
  • The consumer protection authorities of the five Nordic countries have made a joint ‘Nordic statement on climate compensation claims in marketing’. The consumer protection authorities encourage businesses to review their offsetting claims. The statement argues that most businesses will have trouble proving that offsetting claims are true, pointing to challenges such as the lack of permanence, the risk of double counting, and lack of additionality. It is stressed that the Nordic consumer protection authorities can initiate enforcement actions to ensure that offsetting claims are compliant.
  • Upcoming EU legislation, aimed at protecting consumers from so-called greenwashing, introduces a ban on claims such as “climate neutral” for goods and services when offsetting of products’ carbon footprint is involved. Further EU legislation is under development that will regulate climate related claims, including the voluntary use of carbon credits, on the organisational level. There will be significant changes in how companies can communicate and act in this area. Several questions were raised concerning what the new EU regulations mean for companies and other actors in different specific situations.
  • Stakeholders are adapting to the changing regulatory context and revising the formulation of climate-related targets, mitigation strategies and how to frame and communicate climate-related claims. This was exemplified by an overview of ongoing work in the Malmö region LFM30 initiative, which represents a large group of stakeholders in the building, construction, and real estate sectors.
  • Companies can continue to support climate projects and increase their ambitions without making claims of climate neutrality. Practical guidance for so-called beyond value chain mitigation (BVCM) has recently been published. The guidance covers strategies for mobilising finance and supporting climate action beyond the value chain or organisational boundary, including through the voluntary use of carbon credits, and how to transparently and concretely communicate regarding climate action. Positive examples were shared.
  • Several participants showed an interest in learning more about BVCM and to participate in open forums where stakeholders can continue to meet, discuss and build capacity.
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