Guyana Prioritises Premium Carbon Credit Markets: No Rush to Sell Remaining Credits, Says Dr. Jagdeo
Guyana’s Strategic Approach to Carbon Credits
Guyana, a nation renowned for its commitment to environmental stewardship, has taken a deliberate and strategic approach to its participation in the global carbon credit market. Despite initiating discussions with commercial airlines to secure a foothold within the aviation sector for its certified carbon units, the Guyanese government remains firm in its stance that the country will only engage in premium markets. This cautious approach underscores the government’s determination to secure the best value for its carbon credits, as emphasized by the People’s Progressive Party (PPP) General Secretary and Vice-President of Guyana, Dr. Bharrat Jagdeo.
During a recent press conference, Dr. Jagdeo reiterated the government’s position, stating that Guyana is in no rush to sell its remaining carbon credits. He explained that the current prices offered by players in the voluntary market do not reflect the true value of the country’s credits.
“We’re not in any hurry to dispose of the 70 percent of credits that we have because we are waiting to get the right price,” Dr. Jagdeo stated. He further elaborated on the challenges faced in securing a fair price in the voluntary market, noting, “We’re having a hard time getting people to match those prices now because in the voluntary markets globally, what we sold for $15, $20, and $25, it’s sometimes between $1 to $2—that is what’s happening in the voluntary markets.”
The Evolution of Guyana’s Carbon Credit Mechanism
Innovation and leadership have marked Guyana’s entry into the carbon credit market. The country established one of the world’s first Low Carbon Development Strategies (LCDS), which provided a unique mechanism for entering the voluntary market to sell carbon credits. This pioneering initiative has positioned Guyana as a leader in environmental conservation and a key player in the global carbon market.
However, Dr. Jagdeo has been vocal about the need for a more structured mechanism to enable forested countries like Guyana to earn more for the carbon sequestered by standing forests. He has argued that the current voluntary market does not adequately compensate countries for their contributions to reducing global carbon emissions.
Advocacy on the Global Stage
Dr. Jagdeo’s commitment to advancing the interests of forested nations was evident at the 28th Conference of Parties to the United Nations Framework Convention on Climate Change (COP28) in Dubai last year. During the conference, he made a compelling case for world leaders to engage in further discussions on the carbon credit market, particularly concerning forest carbon.
“Because there was no agreement to move Article 6 along, which catered to the development of markets, and that I think was a setback for carbon pricing, particularly forest carbon,” Dr. Jagdeo remarked during the recent press conference. According to Dr. Jagdeo, this setback has hindered the development of a more robust and fair market for carbon credits.
Guyana’s Commitment to Premium Markets
Despite the challenges, Guyana remains steadfast in its commitment to entering only premium carbon credit markets. Dr. Jagdeo emphasized that the country is not in a desperate situation where it needs to accept unfavorable deals. Instead, the government is prepared to wait until the right opportunities arise.
“We are not in any desperate situation where we must accept anything on the market. We will only go into premium markets. However, you also have a global market that influences the price paid in the premium market. So, we are not desperate to dispose of it,” Dr. Jagdeo asserted.
A Groundbreaking Achievement: Guyana’s TREES Credits
Guyana’s efforts to preserve its forests and reduce carbon emissions have not gone unnoticed. The Architecture for REDD+ Transactions (ART) recently issued 7.14 million vintage carbon credits to Guyana, marking a significant milestone in the global fight against climate change. These credits, known as TREES credits, are a testament to Guyana’s successful efforts in reducing forest loss and degradation emissions while maintaining one of the world’s most intact tropical forests through jurisdictional REDD+ initiatives.
Simultaneously, the Government of Guyana made headlines by announcing the world’s first Paris Agreement corresponding adjustment. Framework Convention on Climate Change (UNFCCC) nations Framework Convention on Climate Change (UNFCCC) fulfills the requirements to label these credits as the world’s first eligible for use by airlines towards their targets in the 2024-2026 phase of the International Civil Aviation Organisation’s (ICAO) global emission reduction program, CORSIA.
The Global Significance of Guyana’s Carbon Credits
The issuance of CORSIA-eligible credits from Guyana holds immense global significance. With 126 countries voluntarily participating in CORSIA’s first phase, which commenced on January 1, 2024, Guyana’s TREES credits represent a critical component of international efforts to combat climate change. These credits align with Guyana’s commitment to promoting social inclusion, gender equality, and sustainable development.
The authorization and reporting to the UNFCCC make Guyana’s TREES credits eligible for airlines to use to meet their compliance requirements in CORSIA’s first phase. This development highlights Guyana’s leadership in the global carbon market and sets a precedent for other forested nations seeking to maximize the value of their carbon credits.
Guyana’s approach to the carbon credit market reflects a deep commitment to securing the best possible value for its environmental assets. By prioritizing premium markets and advocating for a more structured global mechanism, the country is positioning itself as a leader in the fight against climate change.
As Dr. Jagdeo made clear, Guyana is not in a hurry to sell its credits; instead, it is focused on ensuring that any deals made are favorable and aligned with the nation’s long-term goals. In the ever-evolving landscape of carbon markets, Guyana’s strategic approach serves as a model for other countries looking to leverage their natural resources for sustainable development.