Carbon finance is a payment system to reward climate change mitigation. Hivos supports poor people, who often do not receive such payments because of its difficult access, to access carbon finance. We do so with a double objective: support people who take action to improve their situation and control their lives in a sustainable way, and. at the same time contribute to the fight against climate change.
Carbon finance pays for the reduction of carbon dioxide emissions and other greenhouse gases (GHG) through the use of clean technologies in production, transport, trade and consumption. Those who pay are polluting countries and industries, as well as any individual or company that wants to compensate for their GHG emissions caused by car or air travel and fossil fuel-based electricity. The emission reductions are priced and traded as a commodity called carbon credits. One carbon credit equals the right to emit one ton of carbon dioxide equivalent.
Hivos focuses on developing carbon finance projects that benefit pro-poor renewable energy projects, such as domestic biogas and clean cookstoves, and sustainable agricultural practices. We connect projects and programmes to buyers willing to pay prices that include a contribution to pro-poor sustainable development (directly aimed at improving the assets and capabilities of the poor) on top of the sustainable development guaranteed by Gold Standard carbon credits.
Hivos Climate Fund
The Hivos Climate Fund was established in 2007. Hivos selected three projects implemented by local organisations: the national domestic biogas programme (NBP) in Cambodia, the household efficient woodstoves project implemented by TaTEDO in Hai and Rombo District in northern Tanzania, and a micro-hydropower plant owned by Ashdinqui, an indigenous village association in central Guatemala.
From 2007 to 2010, 5,750 rural families in Cambodia, Tanzania and Guatemala directly benefited from the 22,375 carbon credits sold in the Netherlands to individuals, small businesses and organisations. Because of the high cost and bureaucratic procedures involved, the carbon credits were verified by independent local consultants, but it became increasingly difficult to sell carbon credits without certification by a respected standard. So we applied to the Gold Standard Registry - recognised for its compliance with sustainable development criteria - and established a strategic partnership with the Climate Neutral Group for marketing carbon credits in the Netherlands and Belgium.
Carbon Finance to Support Development
In 2011, Hivos and the Cambodia National Biogas Programme registered the first domestic biogas project in South East Asia. The issuance and sale of 34,112 carbon credits generated by 8,571 domestic biogas digesters (reducing GHG emissions from May 2009 to August 2010) directly benefited an equal number of rural women and their families. Since 2012, the programme has expanded further. In 2014 nearly 100,000 carbon credits were issued and marketed, and carbon finance has become the main source of funding of the Cambodia Biogas Programme.
Hivos has also registered carbon finance projects for domestic biogas in Indonesia (Indonesia Domestic Biogas Programme), East Africa (African Biogas Partnership Program) and Nicaragua (Programa Nacional de Biogas).
Since 2013, Hivos has worked with the Gold Standard to develop a framework and methodologies for sustainable agriculture. With several partners, we are designing pilot projects in Nicaragua, Peru, Indonesia and Kenya to verify emission reductions and carbon sequestration by organic and low external input agriculture.