"Permanence Trust” would pool resources to address reversal risk in carbon projects 

CONTACT: Kris Voorhees, Senior Director of Communications, media@forestfoundation.org

WASHINGTON, D.C. – The American Forest Foundation released today “A Trust For Permanence: Enabling a New Generation of Permanent Nature-Based Credits in the Voluntary Carbon Market,” a new concept paper that details an innovative approach to ensuring the quality and integrity of credits produced through natural climate solutions (NCS).  

"Natural climate solutions must be part of the fight against climate change—but we need to ensure they make a lasting, sustainable impact,” said Lynn Riley, Lead Scientist at the American Forest Foundation. “The Permanence Trust provides a framework for NCS projects to account for risk that is inherent in working with nature and manage long-term reversal liability. With enough investment, practical application of this trust would not only shift how NCS credits are monetized but also strengthen the trust in their ability to provide meaningful climate mitigation by bringing together the strengths of multiple permanence approaches and project types.” 

Science shows that NCS are essential in keeping the global temperature under 1.5 degrees Celsius, as set out in the Paris Agreement. But for NCS interventions to have a lasting impact on the climate, projects must ensure the credits they produce and sell on carbon markets have the highest standard of permanence—that is, that their impact is equivalent to the emissions they seek to offset, and that means more than decades or even centuries of durability in most cases.  

NCS projects have grappled with the appropriate approach to ensuring the permanence of their credits through buffer pools, accounting, and liability management, and fund-based models have been highlighted by the Paris Agreement Crediting Mechanism and the Integrity Council for the Voluntary Carbon Market (IC-VCM) as having potential, yet are largely untested. The new Permanence Trust concept builds on these ideas and details a different approach: rather than setting aside a discrete number of credits predicted to be at risk of reversal, credits are instead monetized, and proceeds are set aside in a trust where they can grow. 

Unlike existing models that attempt to predict how much climate mitigation to set aside today to make up for non-permanence centuries in the future, the Permanence Trust—envisioned as an independent, possibly market-wide entity—instead relies on models that suggest how many financial resources should be set aside today to grow and be actively used to manage non-permanence risk and eventually fully retire the permanence liability. This could look, for example, like using the funds in the Trust to actively mitigate reversals; investing in permanent geologic carbon storage methods to stack with NCS project credits; utilizing insurance for short-term gaps; and other mixes of approaches.  

This mechanism will allow people and forests to adapt as needed over the coming centuries while maintaining the resources necessary to sustain credited climate benefits, create clear and sustainable liability for NCS permanence, and, for the first time, align the price of an NCS outcome with a clear and meaningful assurance of permanence.  

The authors note challenges to this approach and seek interested partners in its further development, piloting, and feedback. 

The full concept paper can be accessed here.

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About The American Forest Foundation 

The American Forest Foundation is a national organization that empowers family forest owners to deliver meaningful conservation impact. The organization’s programs, the Family Forest Carbon Program and the American Tree Farm System, help landowners implement forest management practices to care for the health and productivity of their woodlands. To learn more about the American Forest Foundation and the Family Forest Carbon Program, visit www.forestfoundation.org.