The who’s who of UK Nature Carbon
We take a look at the main participants in the UK carbon markets and the roles that they play in supply and demand
05 October 2022
The voluntary carbon market enables private investors, governments, non-governmental organisations, and businesses to voluntarily purchase carbon offsets to offset their emissions.
But who are the other parties involved in the space?
Participants in the UK voluntary carbon markets
The current market is complex and involves a number of different participants who contribute to the development, verification and the sale of carbon offset units. Many of the parties in the space have their own point-to-point contracts with one another, and currently, these interactions are each handled on a case-by-case basis.
Landowners own the land on which schemes are created. They will sometimes manage their own carbon schemes, but often outsource the work to developers.
Tenants rent the land for a fixed or indefinite period and have operational control for defined activities. Ideally, a Landowner will reach an agreement with the Tenant around the proposed supply of carbon credits into the market.
Developers undertake the management of individual carbon schemes on behalf of the landowner; designing them in consultation with land managers and other stakeholders, preparing documentation for validation and verification and marketing carbon units to buyers. Developers may also take a physical role in the management of the underlying project.
Government sets an umbrella policy and also may provide capital grants to incentivise the physical establishment of the underlying project. The government may also fund and be a significant stakeholder in the Codes.
Codes provide the framework for measuring and certifying the volume of carbon emission reductions of schemes. Schemes typically have to meet certain benchmarks, standards, and protocols outlined in detailed policies by the codes.
Independent verifiers will evaluate a scheme against the requirements of the codes. The verifiers will check that statements about predicted carbon sequestration are materially correct, with a reasonable level of assurance. Verification happens at predefined intervals to ensure that the level of planned carbon sequestration has actually occurred.
The downstream market is made up of end buyers: companies – or even individual consumers – that have committed to offset part or all of their carbon emissions. While the goal of most buyers is to offset their emissions, in some cases, brokers may also be interested in buying offset units for investment purposes.