Introducing BeZero's project Carbon Accounting Template

Current state of play

Designing and implementing carbon projects is not an easy task. Project types are extremely heterogeneous and methodologies range from relatively simple to extremely complex. 

Renewable energy projects typically have only two moving parts (energy generated and the grid intensity factor used to convert it to carbon savings). At the other extreme, avoided deforestation projects require hundreds of calculations to derive carbon credit issuance.

In the absence of any guidance on format, project developers report calculations to the Validation/ Verification bodies (VVBs) as required to gain accreditation. Public disclosure of a project’s workings are largely the result of this process, with the accessibility of this information to a broader audience often overlooked. 

Reporting it as it is

Assessing or comparing a project’s carbon claims is critical for navigating how quality affects price in the VCM. 

Today, a lack of top-down guidance on the reporting structure of a project’s carbon accounting has led to each project’s public documentation being reported in a unique way. Many project documents are also often derived from the bottom-up, i.e. they are structured around elements specific to that project. 

Furthermore, we find ample examples where the calculations behind vintage level credit issuance cannot be recreated from the information available in the public documentation. 

The upshot is that parties seeking to dig into the weeds spend significant time collecting and refining inconsistent documents into a format that is both intelligible and directly comparable.

We see the lack of a standardised and accessible reporting framework is one of the biggest barriers to scaling the voluntary carbon market. 

Why we developed the Carbon Accounting Template

The BeZero Carbon Rating is an assessment of the likelihood that a credit achieves a tonne of carbon dioxide or equivalent GHG (CO2e) avoided, reduced or removed. We analyse the risks a credit faces in achieving its carbon commitment using a range of information sources. 

This always starts with a project’s own disclosures because these set the parameters around which we interrogate carbon efficacy. All other things being equal, a project’s carbon accounting should substantiate its core claim; that every credit represents a tonne of carbon dioxide or equivalent GHG (CO2e) avoided, reduced or removed. 

We also need to be able to understand the carbon accounting of different projects in a fungible way. To achieve this, we built a standardised model that can be applied to any project type, and any Standards Body.  

This is a simple, but powerful tool. It consists of the four key components required to calculate issuance*:

1. Baseline assumption

2. Project net emissions

3. Leakage

4. Risk buffer allocation

These building blocks are designed to be the lowest level of categorisation that both capture all elements feeding into the calculation of issuance and can be applied to all project types in the market. 

Underlying each component are calculations ranging in complexity and depth depending on the project. Some calculations are zero for many project types, e.g. baseline assumption for certain removals projects. Others require multiple stages of cleaning and structuring by our data collection team. Our team also collects each component at a vintage level given variations can occur within a project’s lifetime. 

Aggregating across these simple components is the first step towards standardised reporting in the market. The result is a full, and comparable, assessment of all the assumptions that lead to the number of credits issued by a project of the period assessed.

Developing the market

Feedback from various market participants shows there is a clear desire to see project information reported in a standardised way. This includes project developers who are looking for guidance on how to report the design and ongoing monitoring of their projects. Likewise investors and potential buyers are looking for ways to assess the assumptions underlying projects in the market today, as well as those being proposed for development. 

Despite this, we find numerous instances where not all these components are available at a vintage level for projects large and small. This is a clear, and addressable, barrier to the market scaling. 

Engagement plan from here

Today, we have decided to make our project carbon accounting template open source. This is the first step in our journey to helping the market scale through improved reporting.

Our aim is to reduce friction in the market, and remove the need for market players to duplicate the task of collecting basic information to understand how projects calculate issuance. More time should be spent on assessing a project’s claims, rather than collecting the starting point for them, if we are to scale the market and attract more entrants. 

We will also be running a consultation period to gather feedback on the template. This will be kicked off by a teach-in session on the data template on 6th December. 

Note, we have a number of other internal templates specific to certain project types. We will also share these if engagement is high and adoption is strong.

Reporting using the BeZero Carbon template

The template is free to download and comes with a ‘how to use’ section including definitions of all terminology used. 

We would ask that project developers or proponents do not send information on projects using this template directly to us with regards to the rating of projects. We use only publicly available information when rating a project and would therefore ask that project’s wanting to use this to report their carbon accounting do so through a registry or by their own means.

This template is not designed to be exhaustive. It is designed to capture the key top down elements required to calculate issuance and applicable to every project in the market. Underlying each of these elements will be a number of calculations.

We take no responsibility for any data that is published using this template. 

*Note: many projects use an uncertainty discount, which can be applied at various stages of this calculation.