UBS, Standard Chartered, BNP Paribas Join New Carbon Markets Platform
Development-stage voluntary carbon marketplace (VCM) Carbonplace announced today the addition of three major global banks, UBS, Standard Chartered, and BNP Paribas as new founding members, significantly expanding the potential users of the VCM platform’s settlements infrastructure and systems services.
Initially launched as Project Carbon in July 2021 by a coalition of banks including CIBC, Brazil’s Itaú Unibanco, National Australia Bank, and Scotland-based NatWest Group, Carbonplace aims to provide the IT infrastructure to facilitate reliable, secure, and scalable trading of high-integrity carbon credits. The platform is expected to be fully operational by the end of 2022.
Kevin Arnold, Global Markets Co-Head Distribution, UBS said:
“Making connections is at the heart of what we do for our clients, which is why we’re delighted to become a member of Carbonplace. This innovative platform will help create a streamlined and transparent voluntary carbon market for our clients and the industry, which will be critical to helping us all fulfil our sustainability strategies.”
Demand for carbon offset projects that counteract the release of greenhouse gases, and related credits, is expected to increase significantly over the next several years, as companies and businesses increasingly launch net zero ambitions, and turn to offsets as a bridge to their own absolute emissions reduction efforts, or to balance difficult to avoid emissions.
The market for carbon credits, however, is challenged by problems including a lack of liquidity, and insufficient or inconsistent data to assess the effectiveness of the projects.
With the new project, the banks aim to facilitate increased delivery of high-quality carbon offset projects, a liquid carbon credit marketplace with price certainty and transparency, the creation of a strong ecosystem to support the offset market, and the development of tools to help clients manage climate risk.
Carbonplace is built on a secure, energy-efficient distributed ledger technology, simplifying the purchase of carbon credits for businesses. Key features of the marketplace include enabling owners of credits to clearly demonstrate possession to the market, with full traceability and linkage back to source of the credit, price discovery through the posting of executed trade sizes and prices to the market, and post trade settlement, allowing all market participants including exchanges and marketplaces to offer value add services on top.
Chris Leeds, Head of Carbon Markets Development, Standard Chartered, and Board Member of the ICVCM said:
“Carbonplace will reduce barriers to entry in the voluntary carbon market, and give project developers in the global south direct access to large numbers of customers looking to fund carbon reduction and removal projects. It builds on the work Standard Chartered has been involved in, in the Taskforce for Scaling the Voluntary Carbon Markets (TSVCM), and ensures that carbon credits on this platform are of the highest-quality.”
Constance Chalchat, CIB Head of Company Engagement & Chief Sustainability Officer BNP Paribas Global Markets, added:
“When launched, Carbonplace will give greater transparency on the pricing and material climate impact of carbon credits, and supports corporates and investors to access quality projects as part of their multi-action carbon management strategies.”