So far, there have been no clear common rules for the domestic netting market, including definitions of netting and carbon neutrality. According to the study, the quality of clearing operations could be improved by developing a guide to best clearing practices and criteria. A commitment to comply with these requirements would be voluntary for companies.
A voluntary register of providers of clearing services would be another effective way to improve quality. The register could also be used to avoid double counting of emission reductions, ie the same reduction would be used several times or would be calculated for several different purposes.
According to the study, the creation of new mandatory national legislation on voluntary set-off is not a viable instrument in the current context. The main reasons for this are the freedom of operators to engage in commercial activities and the freedom of contract, as well as the strict requirements set by EU legislation for Finnish consumer legislation.
“The use of voluntary offsets has increased in recent years, both in Finland and globally, and significant growth is forecast for the industry in the future. Key issues are data availability and reliability: consumers says the Minister for the Environment and Climate Change Krista Mikkonen.
International climate policy that must be taken into account in governance instruments
The authors emphasize that national solutions must take into account international processes and allow flexibility in the development of rules in the future. Separate national solutions, which will soon become obsolete, should be avoided.
Processes influencing decisions in Finland include negotiations on the future of the Paris Agreement and changes in EU climate policy, including the Fit of 55 package and new legislation on the certification system for carbon sinks and tanks. The European Commission’s new legislative proposals are also expected to be linked to misleading product marketing. However, according to the study, the EU legislation to be adopted in the next few years does not mean that national systems cannot be developed at the same time.
“Using crediting measures in a credible way to achieve carbon neutrality for an organization or product requires that the activity meets the criteria for good offsetting projects. Demand for offsetting is growing strongly and clear rules of the game are needed to support it,” says Pasi Rinne, Chairman of the Board of Gaia Consulting.
The study was conducted by Gaia Consulting, Perspectives and Bรคrkraft Legal Services. The purpose of the study was to find out which parts of acknowledgment services should be regulated in Finland. The study also looked at alternative control instruments that could be used for this purpose and assessed their suitability and impact. The study was commissioned by the Ministry of the Environment.
Source: Ministry of the Environment
Source: The Nordic Page