Monday, 10 March 2025.
Last week, we had no new NDCs. However, there was news about GFANZ (and two interesting relationships with Canada and Mexico). In addition, there was news about carbon credits, including the new Article 6 Implementation Status Report, AMBI tokens, and initiatives in the Serra do Mar National Park, Brazil. We also discussed Biodiversity Credits, Climate Change and Machine Learning, as well as listing events and opportunities.
But before that, did you know that our articles are also available in video and audio formats? Click here for YouTube , here for Spotify and give them a try.
WORLD
GFANZ and three critical gaps: data, action and investment. And a common ground between the new Prime Minister of Canada and the President of Mexico.
The Glasgow Financial Alliance for Net Zero (GFANZ) was launched at COP26 to work with the financial system to finance the transition to net zero. Given the current global situation, GFANZ recently decided to restructure itself and focus its efforts on closing three critical gaps:
- Data: The International Sustainability Standards Board (ISSB) has created a global climate reporting standard, with more than 30 jurisdictions already announcing implementation or alignment.
- Action: Expand the use of the voluntary transition plan framework developed by GFANZ, which helps direct capital flows to where emissions are. More than 500 large financial institutions have already developed plans in accordance with this framework.
- Investment: GFANZ is focused on unlocking more than $5 trillion per year in opportunities created by countries that modernize their energy systems towards low-carbon economies over the next decade.
Read the press release here.
Mark Carney, Canada’s incoming Prime Minister, is a central figure in GFANZ, where he served as co-chair and provided crucial leadership. Carney is also the United Nations Special Envoy for Climate Action and Finance, a key role in mobilizing private capital to support the transition to low-carbon economies.
It is worth noting that the current President of Mexico has also played a significant role in global climate issues, serving as a contributing co-author for Mexico in the Intergovernmental Panel on Climate Change (IPCC), the leading international organization studying climate change.
CLIMATE GOVERNANCE
New global coalition for stronger sustainability disclosures
GRI, together with 11 leading sustainable finance and corporate reporting organizations, has issued a public letter urging UN Member States to maintain key sustainability reporting provisions in the negotiations of the Fourth International Conference on Financing for Development (FfD4). The letter, which can be read here, highlights the importance of a harmonized global sustainability reporting system, which can expand market access, strengthen financial stability, reduce costs and increase competitiveness. FfD4 will take place in Seville, Spain, from June 30 to July 3, 2025.
CARBON CREDITS
Article 6 Implementation Status Report available for download
Compiled by the Paris Agreement Article 6 Implementation Partnership, this annual Article 6 Implementation Status Report provides an overview of the readiness, activities and challenges in implementing Article 6 of the Paris Agreement. It is therefore an important resource for information and insights for leaders and decision-makers. The cut-off date is November 1, 2024. Click here for the 63-page report.
AMBI carbon credit tokens in Brazil
Ambipar and B3 Digitas establish an agreement for the negotiation of tokenized carbon credits. The partnership aims to meet the growing demand of the voluntary carbon market, using blockchain technology to guarantee the transparency and traceability of credits. The initiative is part of the companies' efforts to promote sustainability and innovation in the financial market.
Serra do Mar National Park: Are We Underestimating the Potential of Brazil’s Green Jewel of the Atlantic Forest by Focusing Solely on the Value of Carbon Credits?
The Serra do Mar National Park is the largest Atlantic Forest reserve in Brazil, covering over 300,000 hectares, and is home to a vast diversity of flora and fauna, including endemic and endangered species. In addition to being an important ecotourism destination, the park plays a crucial role in conserving the region’s water resources, being the source of many rivers and springs, and is essential for preserving the biodiversity of the Atlantic Forest. Click here for the Guide to Protected Areas in the State of São Paulo.
It is also interesting to know about the efforts to clear human settlements in certain areas, such as the beginning of the ascent of the Serra do Mar between Santos and São Paulo, in Cubatão. Click here to read more about this.
It is estimated that the Atlantic Forest can sequester around 150 to 200 tons of carbon per hectare, which would correspond to a carbon absorption capacity of approximately 45 to 60 million tons of carbon for its entire area over 30 to 40 years.
How much is carbon credit, such as NBS, worth? US$5 to US$20 per ton of CO2 equivalent?
Around US$100 per hectare per year. Or a total of between US$7.5 and 30 million per year over 40 years. It seems little for such a collective global benefit, doesn't it?
And what about biodiversity credits? How much would they be worth? Regulating the local climate, protecting water resources, and supporting essential ecosystem services. Think about the value of all this.
As a reference, 300,000 hectares would be equivalent to the area of Luxembourg or the Comoros Islands, with annual GDPs of US$85.76 billion and US$1.35 billion respectively. Would this be a good reference for the potential and value of an area the size of the Serra do Mar National Park in Brazil?
Perhaps this is why actions such as those of the BRICS or countries like Singapore suggest including other elements of nature in carbon credits.
McKinsey: Biodiversity Credits: A Guide to Identifying High-Integrity Projects
This is a practical guide for buyers of biodiversity credits, providing a structured overview of 10 essential integrity criteria. These criteria help assess projects and mitigate market risks, ensuring that biodiversity credits deliver real and lasting benefits to nature and local communities. The guide was developed in collaboration with stakeholders from the public and private sectors and civil society, and will continue to evolve as new integrity standards are adopted. Read more here and see what the 10 criteria are.
SCIENCE AND TECHNOLOGY
Climate Change and Machine Learning — The Good, the Bad, and the Unknown
A recent MIT Sloan paper explored the impact of machine learning (ML) on climate change, addressing:
1. Positive Aspects:
Energy Efficiency: ML can optimize energy use in electrical systems and smart buildings.
Climate Research: ML accelerates the analysis of large volumes of climate data, improving climate modeling and forecasting.
Transportation and Logistics: ML algorithms help optimize routes, reducing carbon emissions.
2. Negative Aspects:
High Energy Consumption: Training ML models requires large amounts of energy, which can increase carbon emissions.
Business Models: The use of ML in fossil fuel industries and intensive agricultural practices can have negative environmental impacts.
3. Challenges and unknowns:
Transparency: Lack of clarity on how ML models make decisions can make it difficult to assess their environmental impact.
Inequality: Unequal accessibility to ML can exacerbate disparities between developed and developing countries.
Read the full article here.
EVENTS 2025
📍25-27 March | Smart City Expo Curitiba 2025
📍1-3 April | IETA European Climate Summit, Lisbon
📍21-27 April | San Francisco Climate Week, San Francisco
📍30 June - 3 July | Fourth International Conference on Financing for Development (FfD4), Seville, Spain.
OPPORTUNITIES
New IFRS: Contracts Referencing Nature-Dependent Electricity
The topic is part of the updated official printed edition of the International Accounting Standards Board pronouncements issued on December 31, 2024. The “Issued Annotated Standards” version will contain additional content to help users apply the Accounting Standards, including extensive cross-references, explanatory notes and decisions from the IFRS Interpretations Committee agenda. If you would like to register your interest in purchasing the document, follow the link IFRS® Accounting Standards—Issued Annotated at 1 January 2025.
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