SBTi change of tone to boost carbon credit demand and prices

The Science Based Targets initiative (SBTi) on April 9 announced that it will expand the use of environmental attribute certificates, including voluntary carbon credits, for Scope 3 emissions abatement. This decision, which contradicts earlier statements, is expected to impact the voluntary market. On one hand, SBTi’s “support” for the use of credits is set to boost demand, while on the other hand, it can be perceived as a threat to the mitigation hierarchy and SBTi’s credibility. With demand increasing, and the credit supply being cleaned up with the upcoming CCP-label, we expect carbon credit prices to increase again in the short-term.