BeZero Carbon’s first J-REDD+ rating

What is J-REDD+ and how does it work?

Jurisdictional REDD+ (J-REDD+) is a government-led approach to reducing emissions from deforestation and forest degradation, implemented at the national or subnational level. Unlike project-based REDD+, which typically involves discrete areas managed by private developers or non-governmental organisations (NGOs), sovereign entities establish J-REDD+ programmes that cover entire jurisdictions – often encompassing millions of hectares of forest, multiple biomes, Indigenous Peoples’ territories, and/or protected areas. In its simplest construction, a jurisdiction enacts a programme of activities to reduce net forest emissions, as is the case for Guyana-based ART102. More complex J-REDD+ designs can include nested projects, where individual REDD+ projects operate within the larger jurisdictional framework. In these cases, capital can flow from the registry to both sovereign governments and project developers, depending on how crediting is structured. J-REDD+ frameworks include ART’s TREES standard or Verra’s JNR system, and credits issued under these standards may be used in both voluntary carbon markets and compliance pathways, including under Article 6 of the Paris Agreement. In addition, credits from eligible jurisdictional programs may be authorised under Article 6 for use in the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA), the United Nations global decarbonisation scheme for international aviation, further expanding the role of J-REDD+ into compliance schemes. 

By providing a structured mechanism to account for emissions reductions at scale, J-REDD+ supports alignment with national climate targets and forest governance systems. Crucially, the involvement of governments in implementing these programs can enact transformational change on a scale that individual project developers – often constrained by limited means and narrow geographic scope – cannot achieve alone. J-REDD+ is also regarded as a far more effective way to ensure long-term, ongoing compensation for Indigenous Peoples and local communities in recognition of their responsible stewardship of forested lands.

J-REDD+ in the BeZero ratings framework

Differences in spatial scale and the nature of proponents between project-level REDD+ and J-REDD+ programmes of activities warrant particular consideration in our analytical approach to assessing risk. For example, the explicit role of governments in implementing J-REDD+ reshapes our perspective on policy support for activities, and the complicated history of international payments for forest protection requires nuanced treatment of the role of prior funding. There are also differences in how different standards approach the implementation of J-REDD+, such as the length of time programmes must commit their emission reductions as part of the programme of activities. For these reasons, we classify J-REDD+ as its own sub-sector with its own methodology in the BeZero Sector Classification. Nonetheless, J-REDD+ credits will be used to achieve the same atmospheric goals as those issued by project-level REDD+, that is, to offset real emissions to the atmosphere. Therefore, the same overarching rating framework and rating definition apply.

In developing our methodology, we consulted experts in the field and considered the perspectives of key market participants to reach reasonable conclusions around controversial areas, such as the additionality of J-REDD+ programmes. In some areas of the methodology, we have taken a strong stance on some controversial elements. We are confident in these approaches, but accept that these stances will not align with all viewpoints. We welcome any debate that our methodology and any particular rating will stimulate. Constructive discussion is essential to progress, particularly in the rapidly evolving field of carbon markets. As with all our risk assessments, we remain open to revising our approach as new evidence emerges. The role of the ratings agency is to provide an unbiased and nuanced view on a project’s or programme’s likelihood to deliver on its claimed climate benefits. Providing this assessment of programmes of activities or credits in the compliance market is no different.

Beyond carbon

While it does not directly contribute to our BeZero Carbon Rating for carbon efficacy, we include an analysis of the social and environmental risks associated with ART102, and the safeguards the programme implements to mitigate them. This provides insight into the far-reaching impacts of J-REDD+ Beyond Carbon outcomes. At the jurisdictional level, programmes involve a wide range of stakeholders and carry both opportunities and risks that must be carefully managed to ensure a net-positive outcome. The ART102 safeguards analysis marks another first for BeZero in Beyond Carbon programme analysis, offering a comprehensive view into the inherent risks posed by a jurisdictional programme of its size, and how programme design and safeguards manage this risk. 

Implications for compliance schemes

ART102 credits were developed under the Article 6.2 framework and are specifically authorised for use towards CORSIA. Currently, ART102 credits represent the only eligible supply for airlines under the first phase of CORSIA, the international aviation decarbonisation scheme. 

We have previously highlighted the potential for CORSIA-eligible credits to range considerably in their level of carbon performance risk. Our rating for ART102 demonstrates this conclusively, with implications for CORSIA and compliance schemes which integrate carbon credits more generally. As in voluntary markets, ratings can play a vital role within compliance schemes in enabling buyers to identify lower-risk credits. Going further, ratings can and should play a regulatory function within compliance schemes, introducing an incentive (or even a requirement) for credits more likely to deliver on their carbon claim.

Implementing a high-integrity carbon credit methodology does not automatically generate high-quality credits. This is a consistent lesson from our work in the voluntary market and also applies to credits eligible within compliance schemes. The environmental integrity of credits supplied to compliance schemes will vary, and these must have an independent and unbiased assessment of the risk associated with each. As we expand our compliance scheme offering and as more jurisdictional credits enter the market under frameworks such as ART TREES, Verra VCS JNR, or the Forest Carbon Partnership Facility, carbon ratings – such as those provided by BeZero – are essential tools for understanding underlying integrity risks. 

Expanding forest protection and providing a finance mechanism to enable such protections at the scale of entire jurisdictions is timely and necessary. The need for jurisdictional-scale forest protection is especially critical in places where project-based implementation has been hard to operationalise, or when international macroeconomic or development factors pose a systemic risk to standing forest. Ultimately, however, credits issued from these programmes, compliance or otherwise, must be additional, accurately accounted for, and permanent for the timeframe committed if they are to be used to offset anthropogenic emissions to the atmosphere.