This is where my thoughts are now after the summer (here's the [jargon decoder](https://www.alexprather.co/post/a-climate-geek-s-guide-to-the-carbon-markets-the-jargon-decoder) if you need it): Carbon markets are in flux. While the voluntary market is expected to hit $2 billion in 2022 (quadrupling in size since 2020) and ETSs now cover over 55% of the world's GDP, there is a long way to go to establish high-integrity, well-functioning market dynamics. Attempts to establish effective market dynamics are underway.** At the top of the pyramid, the ICVCM and the VCMI seek to bring order to chaos on both the supply and demand sides, respectively, in the VCMs. In addition, the World Bank's Climate Warehouse Program seeks to centralize all credits from the registries into a universal registry to help deal with double-counting and corresponding adjustment issues. With Article 6 going into effect, it's almost as if the plane is getting built as it's headed off the tarmac. All along the value chain, companies are popping up to try to get in on the action: BeZero is an example of supply-side quality ratings, Patch and Watershed are poking around on the marketplaces and carbon accounting side, and South Pole is trying to…intervene across the value chain from demand to supply. Companies like Pachama are also entering the project development and moving along the value chain. There are so many companies entering the space; I need to do a proper value chain mapping…on the list for this year, though :) See ideas for Independent Study Projects here. Feedback appreciated! [https://www.alexprather.co/forum/discussion/ideas-for-my-independent-study-projects-hks](https://www.alexprather.co/forum/discussion/ideas-for-my-independent-study-projects-hks) VCMs and ETSs are becoming more closely linked, and the relationship is becoming more complicated. There are benefits to both from a climate perspective; VCMs are particularly interesting because of their ability to deal with innovation better (that said, VCMs are still really bad at dealing with innovation!) than ETSs. However, ETSs have better "sticks" with legally binding regulations to make sure emissions targets are met. More ETSs are coming online: In 2021, the China National ETS (now the world's largest), the German National ETS, and the UK ETS came online. Austria launched the Austrian National ETS in 2022. Mexico is expected to form an ETS in 2023. India recently announced that it would also implement a carbon trading scheme soon. As more ETSs come online, the corresponding adjustment becomes all the more of a heated issue: some arguing for a corresponding adjustment say that it will help to reduce double counting by subtracting emissions reductions from a host country's account and adding them to the importing country's account. Still, some experts argue that this will create perverse incentives and negatively impact host countries' ability to meet their NDCs. Policy dynamics will also take carbon markets through a spin cycle. Indonesia has paused international carbon credits purchases as they figure out their internal carbon trading policies. With India's announcement of a carbon trading program, they also announced that they would be taking their emissions reductions credits off the market to use them to meet their NDCs; it is unclear right now whether that is only relevant to renewable energy credits and avoidance and whether or not natural climate solution projects will fall under that umbrella––the expectation is no, at least for now (but given the nature of Indian bureaucracy, you never know!). Kenya has proposed a policy that would categorize carbon projects as natural resources under the Natural Resources (Benefits Sharing) Bill and would be required to give 60% of their revenues to the government…which is insane. Northern Rangelands Trust is trying to figure out how to lobby against this because it would ruin the incentive structure of their project that keeps it working well. Link to that below. Here are some links on those policies: https://www.ecosystemmarketplace.com/articles/opinion-corresponding-adjustments-impact-ndcs-additionality/ https://www.iflr.com/article/2a7cuhvpor15vq4y4uu4h/indonesias-carbon-trading-system-challenges-and-opportunities https://www.bloomberg.com/news/articles/2022-08-08/india-to-stop-carbon-credit-exports-until-climate-goals-are-met https://www.ecosystemmarketplace.com/articles/a-ban-on-exporting-carbon-credits-and-its-impact-on-the-domestic-carbon-market/ https://www.theguardian.com/global-development/2022/may/13/its-a-struggle-for-survival-why-kenya-and-its-wildlife-need-tourists-to-return http://www.parliament.go.ke/sites/default/files/2021-10/Report High-quality carbon credits supply cannot keep up with market demand; trust and integrity are significant issues. The market is putting pressure on the supply-side to improve credit integrity and quality. With the wave of demand driven by corporate climate commitments, the voluntary market is expected to keep growing exponentially. While this is exciting, there are still significant issues in consistently generating high-quality carbon credits, particularly with NCS projects. This is also reflected in buying preferences: most credit buyers' first choice of transaction method is through bilateral agreements or marketing partners. There are a couple of things to unpack here: first is the fact that there is a lack of trust not only in the projects themselves but in intermediaries as well. From the supply side, top concerns are additionality, leakage, flawed baselines and counterfactuals, minimal data, allometric models not aligning with reality, climate change impacting projects, social risks, etc. There are few discerning buyers, with Microsoft being perhaps one of the most well-versed corporate buyers. They have to run their due diligence process on their carbon credit purchases because they do not believe that the intermediaries determining quality are up to par. Additionally, while there is a need to create new ways to improve the standards and verification process for credits, the demand side is biased toward Verra, with Verra issuing over 60% of all credits in the voluntary market. While I believe that we need to see A LOT more Verras (maybe even a bunch of specialized ones), lack of trust is a huge issue. One last note on this re: removals vs. avoidances vs. emissions reductions because I could go on and on. Currently, only 3% of carbon credits in the VROD are removals (nature-based), while REDD+ projects (avoidance) accounted for around 38% of credits, and renewable energy credits (avoidance) accounted for 36% of the number of credits issued in 2021. Removal projects will see increased demand over time as renewable energy credits' additionality is being called into question now that renewable energy is becoming cost-competitive with fossil fuels in these regions. Additionally, as REDD+ projects come under greater scrutiny because of their sometimes harmful practices and potential lack of additionality if conservation comes under national government's jurisdiction, even greater demand pressures will be put on NCS projects that are removal based. I am concerned about how NCS projects in developing countries might (either intentionally or unintentionally) cut corners or manipulate the system because of these incentives. Pricing is not correctly accounting for negative/positive externalities. A common concern in the carbon markets world is that carbon credits are not appropriately priced for the value that they are creating. There are three angles to look at this from: (1) polluters are not properly paying for the negative externalities associated with the operations of their businesses, and (2) positive externalities are not adequately priced into the carbon credits that are being generated by natural climate solutions, and (3) there should just be separate crediting/market/financing mechanisms altogether for ecosystem services. From the NCS side, there could be a lot of potential to unlock more capital by creating a new asset class and financing mechanisms. Unfortunately, governments and the private sector are slow to see value in nature, and carbon is essentially being used as a proxy right now. https://news.mongabay.com/2021/10/look-beyond-carbon-credits-to-put-a-price-on-natures-services-experts-say/ I am now looking at CDR on a spectrum both in terms of technology use in solutions and permanence/durability; I think that integrating more technological interventions in natural carbon sinks can help move along the durability/permanence spectrum. CDR can be seen as a spectrum from nature plays to engineered solutions––and there are lots in-between; incorporating more technology can improve the efficacy of natural carbon sinks and move along the durability spectrum. There are a couple of avenues at the nature-tech intersection that I find interesting right now: (1) data, (2) CDR innovation, (3) carbon markets and carbon project operations, and (4) other ways to improve the durability of NCS projects. There is a HUGE lack of data on biomass and carbon stocks in the Global South**––most of the biomass data captured is in the Global North, yet most of the world's most high potential biomass and carbon sinks are in the Global South. Looking at capturing more data on biomass and carbon stocks can be segmented by type of biomass/sink, region/geography, and type of data captured. There are big opportunities for monitoring biodiversity, wildlife, and other ecosystem services. After seeing what a total pain data collection and the MRV process are on the ground, it's clear lots of innovation is needed. And that's for forest/shrub biomass––imagine the lack of data for blue carbon projects or other types of biomass like mangroves! With more and better data comes many opportunities to build more solutions: naturally, MRV tech is a clear opportunity here, but more business models will emerge over time, too––better ways to identify project opportunities, mitigate risks, reduce costs, etc. There are many untapped opportunities to explore carbon removal technologies and methods along this nature-tech spectrum**. From genetically modifying organisms to sequester more carbon or become more resilient to changing climates to improving new techniques for sequestering carbon such as macroalgae sinking, ocean alkalinity enhancement, etc., there is a slew of new ideas to be explored here. Lowercarbon's wishlist is a pretty fantastic read on this: https://lowercarboncapital.com/2022/07/27/cdr-wishlist/ I will say on this too that there is a huge barrier of knowledge between the tech community and NCS projects; I think more critical risks to permanence/durability of NCS projects are due to socio-political-economic risks of stakeholder incentives versus the actual carbon sequestration of natural solutions. Ex: land tenure—is there a contract in place with the government to ensure project longevity of 60-100 years? That’s how Delta Blue Carbon ensures greater durability. But that’s a property rights issue, not anything to do with the actual mangroves! On GMOs: As I was driving through areas in Northern Kenya that hadn't seen a drop of rain in 1.5 years with another failed rainy season well underway, I started seriously weighing the pro's/con's of incorporating GMOs into these landscapes, such as drought-resilient grasses. Verra has a strict no GMO policy in most methodologies used (though after talking to Living Carbon, it seems like they are adjusting their position which is cool), and it seems likely that even if GMOs were proven not to be harmful or invasive to ecosystems, market acceptance would be fraught with polarized views that GMOs for human consumption face despite much of the scientific community is okay with them. That said, humans have been manipulating ecosystems since the dawn of time, and evolution is a natural process for genetic modification. Since we are the cause of accelerating climate change, don't we also have the responsibility to help nature keep up and adapt? Don't worry––I'm taking some ecosystem ecology classes at Harvard this coming year 🙂 There are many opportunities to improve market dynamics and build solutions to help CDR projects operationally. While there has been a lot of progress in software plays on the demand side, much more can be done to help the supply side. Companies like Watershed, Patch, and Climate Neutral work along the demand side and into marketplaces. On the supply side, companies like Slyvera, BeZero, and Calyx are working toward better rating systems for carbon credits and creating better mechanisms to evaluate the quality and co-benefits of CDR projects. However, more can be done, particularly in helping more projects come online on the supply side (where's the TurboTax of NCS projects?), become more efficient, lower transaction costs, improve project management, navigate marketplaces, etc. I think a significant barrier to seeing more software solutions come online is the fact that there is a massive understanding and empathy gap between project developers and your typical software engineer sitting in silicon valley. It's tough to build solutions for problems you don't fully understand. Maybe we need to drag more technologists to visit NCS projects around the world… There is insufficient support, resources, skills training, and knowledge sharing in the NCS world. Right now, capital is flooding the NCS space, and there's a near-total lack of support and resources available outside of $$$. During the summer, I heard some crazy stories about PE shops pitching NGOs in developing countries to take on carbon projects––while the NGO was excited by the amount of money they were being offered, they had no idea how to get started. There is a total lack of best practices and knowledge sharing among NCS projects. To me, there is a clear need for some sort of NCS project accelerator or venture studio kind of model to help improve the quality of NCS projects. I was hesitant to explore this idea when it first popped into my head because I was afraid I was falling into the trap of my own biases after working in incubation/acceleration for so long. But now I am thinking this could be very helpful. Having some sort of convener with credibility within the climate community could also help serve as a liaison between the tech community and more NCS projects. Perhaps one of the most heartbreaking conversations this summer was discussing how alone these teams felt in the world. NCS projects are incredibly complex, and these teams must manage really challenging on-the-ground realities. Having a peer community/ cohort could help improve the actual quality of projects but also help teams connect and find emotional support. Exploring the solutions side is another theme for one of my ISPs; feedback appreciated! https://www.alexprather.co/forum/discussion/ideas-for-my-independent-study-projects-hks Natural Climate Solutions have tremendous potential to create impact through spillover effects aside from the carbon removed, but aligning incentives properly to deliver high-quality results is really freaking hard! Coming from a background in development economics and impact investing in emerging economies, I figure I have a pretty unique lens to bring to this space, but I was very cautious of this, too––I was afraid of my own biases getting in the way of deeply understanding NCS projects. As I started to unpack the complexities of these projects on the ground, I began to see these projects in an entirely new, albeit familiar, way: these are sustainable development projects with a co-benefit of carbon removal. This is not how the demand-side is talking about these projects, which goes back to the issue of having ecosystem services (and economic development services, I might add) bundled into carbon credits serving as a proxy. But these projects are complex: you're dealing with socioeconomic and political incentive alignment! All of a sudden, NCS projects have to manage microeconomics problems, policy problems, governance problems, macroeconomics problems, and sociology problems––and that's aside from the carbon removal and ecology problems! Again, there is just not enough support to help solve all of these other problems. That said, I have never seen so much potential to create impact as I saw with Northern Rangelands Trust and how they work with their communities (I won't go into depth on this because it's all in my field notes on the forum). Yes, the carbon project is helping to restore grasslands, and yes, biodiversity is improving, and yes, these communities now have 3-5x the revenues they had before to invest in education, health, and livelihoods. But what struck me the most was the ownership, pride, and dignity this project sparked in these communities. NRT had flipped the foreign aid/NGO model on its head, and instead of telling these communities what to do with the carbon project revenues, these communities were now the ultimate decision-makers. After generations of abuse––from colonialist pillaging of these lands and natural resources to dysfunctional and sometimes even corrupt aid organizations and NGOs––I saw a glimpse of something so powerfully impactful that could help to transform these communities and allow more marginalized communities around the world to lead the lives that they want in a dignified and respectful way. To me, this is worth fighting for. A weird dynamic is going on, particularly among those singularly focused on high-permanence carbon removal solutions. It seems like people are picking teams vs. applying a suite of solutions (each with its strengths/weaknesses). I've both read and listened to people in the tech community scoff about natural climate solutions and dismiss them because they are lacking on the permanence side––but this isn’t a one vs. the other type of scenario, we need as many ideas and brains on this as possible. This dynamic limits the nuanced perspectives necessary to adequately address carbon removal across the entire technology spectrum. It also sidelines the value that natural climate solutions can offer to help address more aspects of the climate crisis than *just* carbon emissions. The way that I look at it is that more permanent forms of CDR are *absolutely* needed, but right now, NCS can buy us some time to get those technologies and innovations to scale over time––there is still a long way to go down the cost curve and to reach gigaton scale. Rather than scoffing at NCS projects for their many flaws, why aren't more people helping improve them? This is driving me crazy. One of my biggest pet peeves is criticism without thought or suggestions on how to improve things. NCS projects are overwhelmingly challenging to build correctly because there are so many complex systems, feedback loops, and variables at play. I'd rather help improve these projects than sit back and criticize them from my comfy chair in Cambridge, MA. General reflections: If anything, this summer gave me an incredible opportunity to take the space and time needed to think deeply and understand the carbon markets and carbon removal space. A few words to summarize my summer: nuance, complexity, exponential learning, empathy, risk, and hope. Reflecting on the summer, I gained a far more nuanced perspective on the complexity of the carbon markets space. I was able to do some deep thinking, complemented with conversations with industry experts, spend time with passionate friends and peers, get some real, on-the-ground experience, and engage with new perspectives that pushed my thinking to a higher level. These experiences gave me a much stronger appreciation of the challenges and risks facing carbon removal. They allowed me to meet some incredible people along the way that I want to see succeed. Ultimately though, the summer reinvigorated hope: I saw some of the most powerfully impactful that carbon projects can have when built well, I got to unpack the potential of new and emerging solutions and talk to founders working on exciting innovations in the CDR space, and I got to spend some time reconnecting with nature. It is fun to reflect on where I was several months ago and see how my opinions have evolved. I feel far more confidently than before that this is the space I want to be in: supporting nature to thrive with the help of technology along the way. I believe the dynamics of carbon markets and the role they can (and will) play in scaling innovative solutions will be essential. So for this, I am deeply grateful for this summer and for your support along the way! As for me, I will keep chugging along this year and continue unbundling this tricky and fascinating space. What has become very clear, though, is that I am *very* excited about this intersection of nature and technology, carbon markets, and how to bring all of these bits and pieces together. </rant>

Northern Rangelands Trust: Background The Lewa Conservancy started in the 1980’s by Ian Craig to protect Kenya’s endangered rhino populations that dropped from 20,000 in the 1960s to 500 by the 1980s due to poaching. The Lewa Conservancy was created with 62,000 hectares and by 1995 had established a flourishing ecosystem for the rhinos, but it became necessary to engaged the surrounding pastoralist communities. Elephants are the cornerstone animal in this ecosystem After meeting with these communities, Northern Rangelands Trust was formed in 2004 to create a community-led conservancy model. NRT and Lewa are separate entites though support one another. https://www.nrt-kenya.org/ NRT currently comprises 43 community-led conservancies throughout Northern and coastal Kenya, and represents 6.2 million hectares of land and 465,170 people. landmass is 1.5x the size of Denmark! There are no hard boundaries in NRT and no fencing; pastoralist grazing and wildlife migration is necessary in these communities . NRT focuses on community-led interventions, and is structured to have community lead the hierarchy of decision making: Each of the conservancies that have legal land tenure elect the Conservancy Board (Holds AGM; 3 year tenure) that includes: a conservancy manager, a rangeland coordinator, a tourism office, an accountant and an employee of NRT that is appointed by the Conservancy Board. The Rangeland coordinator oversees the grazing committee for the carbon project; each village has a representative They gather for quarterly meetings: two during wet season, two during dry season. There are 21 conservancies that are now part of the carbon project, with 22 still external. The NRT board is comprised of people from the government, NGOs, businesses, strategy/growth including BCG.org Then the Executive Team sits underneath the Board and delivers programs on: Governance Peace & Security Livelihoods NRT Trading (vocational/beadwork/LTM training) Wildlife/natural resources/forestry/marine/endangered species conservation Carbon Projects Education Health M&E NRT has been 100% donor funded; carbon credits changing this 76% of donor funding comes from: USAID, EU, DANIDA, The Nature Conservancy $18-24m to run NRT per annum NRT Carbon Project: Background Jess Chaplin and Kieran Avery running the Carbon Project; 1.9 million hectares, with 14 participating conservancies, and is expected to store ~50 million tons of CO2 over 30 years. They are using VM0032 as a beta tester which is a combination of community-engagement in grazing management and grassland soil organic carbon sequestration. Website: https://www.nrt-kenya.org/carbon-project VM0032: https://verra.org/wp-content/uploads/2018/03/VM0032-Meth-for-the-Adopt-of-Sustain-Grasslands-through-Adj-of-Fire-and-Grazing-v1.0.pdf NRT Project Description: https://verra.org/wp-content/uploads/2016/09/CCB_IMP_REP_1468_10DEC2012_31JUL2016.pdf Native is their Project Developer; Vermont-based: https://native.eco/; Alex will be meeting a team member based in Cambridge when back in town. Expect to expand the carbon project and spin off into it’s own unit: three more project sites for grasslands (expand up to 2.5m hectares) and include coastal mangroves + seagrass projects. The 14 conservancies today evolved over time: they split since the 1990s because of community preferences and tribal disagreements. Carbon Credit Sales Currently, NRT has received payment for their first sales of carbon credits from 2016 - 2020; verification took four years; huge time lag. The credits were verified in 2020, and were put on the market in 2021. First half of 2021, had to deal with an environmental justice “think tank” that published a report saying NRT was abusing its community members; they weren’t. They have issues with tribal disputes that they end up having to help mitigate and this research latched onto it with an agenda. Because of this, NRT underwent extensive investigation by The UN and TNC. The conclusion was that NRT was falsely accused. The only thing that came up was a better process of ensuring FPIC (Free, Prior and Informed Consent) The Carbon Project had already proceeded with FPIC and they were fine on this. When credits went up on Verra, big name buyers came: Netflix, Salesforce, Respira In the first half of 2021, prices ranged from ~$4-15.5/ton In the second half of 2021, prices ranged from ~$22-25/ton Revenue sharing: Total sales - project costs = net revenue for conservancies Total sales = VCUs * price Project costs = Native team (technical support, MRV, marketing & sales, capital and technical project development, support in seeking capital) + Fixed costs of project Net Revenue = divided into 15 portions (14 conservancy funds + 1 buffer rainy day portion) + gov’t service fee The buffer is kept in reserve in case of market shocks/price collapse Each conservancy gets: 1/15th of the net revenue (approx $325k) 40% goes to conservancy operations: 50% to conservancy manager/tourism/accountant/vehicles/operations 50% to ranger salaries and rangeland operational activities 60% goes to Carbon Community Fund: The conservancy socializes how much funding is available in the CCF They work to prioritize the communities’ interests; endorse top priorities for investment at the AGM Required to submit requisition form with evidence of meeting and attendance They propose their priorities to NRT, NRT helps the communities tweak and co-develop plans and monitor to see that accounts demonstrate expenditures. Carbon Finance: Flipping the community-support model The Carbon Project is a game changer for NRT and the Conservancies they work with: In the past, donor funding largely dictated what programs and which conservancies benefit from a top-down approach Ex: DANIDA has a program to build water access wells so NRT helps open up access; some conservancies complain that wells are not built in the right locations, so it’s a waste of aid money. With carbon finance, suddenly the conservancies have the capital, and they determine what their community needs are; then NRT helps them deliver. Over time, NRT believes that this will dramatically increase self-sufficiency, increase capacity and drive ownership of the project as well as the initiatives that the community has themselves prioritized. Empowering community oversight and engagement On the horizon: Kenyan government wants to take 60% of all carbon credit revenues (proposed), though not put into policy yet. This would be devastating for the project: it would remove a huge source of revenue currently going to communities and weaken the incentives to participate in the project. How it works: At the AGM (community meeting), the community leaders sensitize the community to the amount of money they have access to, and the conservancy members identify their needs, come up with a big list, and then work together to narrow down and prioritize their needs. Ex: Melako CCY faced severe drought this year, so they prioritized: #1 education bursary #2 more bore wells and piping to households #3 tourism facilities/business creation #4 fixing up school buildings Once they have their list, the CCY board members bring that list to NRT, and they work with them to determine the budgeting/execution of their priorities. NRT either helps them through services already being offered or helps the CCY connect to other organizations that they can contract to help them deliver on their prioritized projects. Basically, the CCYs are now investing in NRT: do they agree or not with what NRT can offer? They get to decide. NRT sees itself shifting toward a development-as-a-service form of conservation and non-profit work. Impact: It’s pretty powerful: with a steady stream of income, even during times of drought, the communities are able to prioritize long-term goals. They are choosing to invest in the youth, increase livestock, long-term skills development Use of Tech Extremely keen to use technology in the MRV process; but the methodology has to get established through Verra in order to use it. Currently, soil sampling requires a lot of time and energy (and capital). They are dealing with 1.5x the land mass of Denmark so they definitely need help on this. With the expansion into mangroves restoration, even more keen to bring in tech Already using some technology: EarthRanger, a conservation technology Funded by Vulcan Capital, of the late Paul Allen, they use this tech to monitor wildlife and send rapid response teams to mitigate conflict among pastoralists and to deter poachers from abusing the protected animals. Issues they regularly deal with: Poaching Cattle stealing Intertribal conflict/gunfights Lewa Conservancy and 51 Degrees (the security team), is authorized by the government to carry firearms and arrest, not NRT––this is from the anti-poaching work Currently manage nearly 1000 rangers and have 9 rapid response teams The Carbon Project: Deep Dive and MRV Started thinking about the carbon project in 2010 with the help of Matt Brown from The Nature Conservancy and Mark Ritchie from Soils for Future. Helped to develop the model based on experience in the Serengeti NRT is the first open landscape community-based soil carbon project; this is also the biggest complication and risk factor. Started the process through Verra in 2017 and conducted soil sampling with Soils for Future’s help. Brought in Native as well to support with financing. Current soil sampling process: simple in the field, just labor intensive and costly. The technical work is in the lab Send samples to ICRAF in Nairobi for processing. Opportunities to reduce input costs? Ideally, would prefer to do soil sampling much more efficiently and affordably. Willing to accept costs of an external professional/company for improved accuracy, efficiency, etc. Even biodiversity is a rudimentary process: stick tubes in the ground to catch dung beetles, insects; track birds and monitor wildlife through camera traps. Evaluate vegetation for biodiversity too. Runs this process every three years. CCB is a big selling point; increasing willingness to pay is dependent on perceived value among demand side and the ability for the supply side to offer premiums Project scalability? Have 3 more projects planned and will increase project scope from 1.9m hectares to 2.5m, perhaps even 3m hectares. This sort of project cannot work at small scale because it is so dependent on capturing the buy-in of pastoralist communities. If you only have one community, the neighboring communities will encroach on regenerated lands because the grasses are healthier; therefore ruining the project. Expanding the scope of these projects increases the integrity. Factors to consider as they scale: staffing, spinning out into a separate entity from NRT, displacing existing donors Inhibitors to scale? Land tenure is KEY; fenced in areas ruin the scalability of the project because the movement of livestock and people is a key factor in these projects. Therefore size is an inhibitor as well; Buffer zones are an opportunity around Maasai Mara (county land tenure) and Serengeti (national land tenure) Look at Southern Kenya: lots of the land is privatized and fenced, a disaster for wildlife Thoughts on capitalism in conservation: incentives have to align around conservation and cannot keep asking for taxpayers money for this work, it’s unsustainable. This has to be communicated better; this is the future of conservation. Determining revenue sharing model? Considered a host of options: Size of conservancy/credit of livestock Population Productivity Eventually landed on equal allocation among the conservancies: it seemed like the fairest and most simple way to distribute the capital. The project success is dependent on the conservancies as a collective unit and spillover effects of incentives in one way or another could cause competition among the CCYs instead of collaboration. Considering implementing a bonus/penalty process to incentivize habit change Improve the consistency and timeliness of reporting Things NRT is looking to improve: MRV process and integrating more technology; the process is very labor intensive and there are opportunities for SOC technologies to play a bigger role but they need the methodologies approved by Verra to get there. Using NDVI and other sensing technologies for grazing reports Currently using satellite imagery which is quite crude Make GIS more robust Therefore drive more value for their credits Will be implementing mangrove projects and they know the MRV process for mangroves is even more challenging because of the environment. Surveying methodology for communities Currently it’s paper-based, requires meeting minutes to be tracked 30% of each CCY owns smart phones; penetration is there and the tech literacy argument is now outdated Would like to digitize and create dashboards for better M&E Have to ensure data is: valid, honest, and error-free NRT has to be able to verify the data coming in Capacity building at the CCYs to understand carbon credits better and their role Improve access to capital for other carbon projects: working with TNC on their new initiative called Project Finance for Permanence. Jess will keep Alex in the loop as the draft is launched. Bus Project: a mobile bus for the carbon project → go to the herders where they are to spread awareness about the project and educate the herders on how this relates to them. Almost like an evangelism model but for the carbon project; evangelism of restorative rangelands and pastoralist practices and to help coordinate grazing more effectively. Also to provide quick support on: Animal husbandry advice Livestock health treatment Remote human healthcare: eye care, dental, health Relatable, real time feedback for pastoralist herders Site Visits with Rangers and CCY Board: Leparua Demographics & background: Conservancy formed in 2010; population has grown from 8,500 to 11,000 (2022) 33,000 hectares Five ethnic communities within CCY Decided to form CCY to reduce tribal conflict; 7 other conservancies at that time 22 staff: 19 rangers, rangeland coordinator and community liaison Also a manager + board of 17 members About the conflict and NRT interventions: Had problems with resource sharing; formed CCY by convening the tribal leaders and agreeing on CCY model with NRT’s support. Major intervention: rangeland and livestock management program to share resources in a peaceful way Invested in livelihoods support: loans via SACCOs (savings and credit cooperative organization) and livelihood training programs for those who do not depend on livestock to reduce dependency on land for livelihoods Education: creation of bursary funds, mentorship programs for students who want to pursue higher education Helped more children access education Helped to create and improve infrastructure for schools Boarding schools for girls Water access at schools Security interventions are extremely important: managing poaching through patrolling, livestock conflict (theft, etc.), and wildlife-human conflict intervention The Carbon Project: When it was introduced, the CCY members didn’t quite understand what it was and what they needed to do. Had to educate the community. The community already understand climate change at a very basic level: other organizations had run some awareness programs on global warming in the community to help them understand heightened drought cycles. The way they understand it: big companies in the world put a lot of CO2 in the air, and now they are putting aside money to support people who are able to remove it from the air. Their ecosystem and their grasses can take CO2 out of the air, so they can get paid for protecting the grasslands and making sure they are kept healthy. They see the connection between carbon and global warming They received the carbon project well and accepted the opportunity to participate over time. The have seen the incentives increase support for the program over time; the funding from the carbon project has created more awareness. When they see the impact, like the creation of a new water well, and they learn where the money came from, there is an increased desire to participate Now, the community is wondering how they can remove MORE carbon and access more carbon credit capital. They are willing to experiment and adopt new ideas Want to reduce charcoal burning so there is less timber use Want to plant trees (maybe not the best idea?); restore more ecosystems Develop more robust plan for grazing Tree planting at a household level How does this impact the Verra methodology being used? If the community is adding new carbon removal solutions (e.g. reforestation or clean cookstoves) under the assumption that they will get more credits without going through the verification process, those credits will not count. If the community isn’t aware of this, they may get frustrated with their efforts not translating into ROI Impact on the community: They are very supportive because they have seen: The project help to support even the smallest villages in the CCY They see improvements in access to water and infrastructure which has generated pride in the project Because this capital inflow came in a time of severe drought, they recognized the power of the project to help them fall back on greater support. They are ready for the next rain with seed banks to plant more grasses, irrigation systems and trees Questions the community has: This has been incredible but how long will the project actually last? Can we rely on this money for a long time or was this a one off thing? How can they increase the $$$ coming into the CCY? Site Visits with Rangers and CCY Board: Kalama Demographics and background: Formed CCY in 2004, one of the first; population has grown from 11,000 to 17,000 (2022) Sensitized community by bringing them to visit masai mara: decided to form the CCY after. 16,000 hectares 15 settlements in the CCY; 4-5 ethnic groups represented 70 total staff members Land is not arable so mostly used for wildlife; there is a famous safari lodge in this CCY Carbon Project: When it launched in 2012, it wasn’t entirely clear publicly because NRT wasn’t fully sure that it would move forward and didn’t want to make empty promises to the conservancies. It took about 10 years for the project to demonstrate its impact to the community. Went through the entire process with NRT: soil sampling, agreements with the board and NRT, etc. Now that the project has realized revenues, the CCY sees that it is working. When funds were disbursed, the 14 participating CCYs were informed and that translated from the board down to the grazing community The carbon agenda was adopted, wrote minutes and agreed to support Carbon Project via the FPIC The community had a basic understanding of what was going on: Their understanding was that America has been putting a lot of bad air into the atmosphere and the grasses and trees on their land were able to take it out of the air. Because of this, America is paying them for solving this problem. The revenues were 2-3x what the community normally generates in a year which has been a total game changer. They decided to invest the money into the following: Establishment of a business complex: to help community members build more businesses with a long term plan to keep growing this business complex (200k/year revenues generated) Increased security outposts: this CCY is at an intersection of a big bandit passage, so they want to increase security to reduce cross-border conflicts and improve the overall project area’s stability. They believe this is necessary to ensuring the project longevity. Early childhood development: they are investing in rehabilitating poorly constructed and poorly maintained education facilities built by government and NGOs that have not returned to continue their support. They want to see: Increased bursary funds to support children’s education Increased tourism Increased livelihoods and more women led enterprises Increased food security: by investing in fruit/vegetable cultivation to improve diet and food security Improved health access: want to invest in an ambulance tricycle to bring healthcare to more isolated villages in the CCY The community feels ownership over these projects because of self-determined goals and priorities CCY is concerned about how drought will impact the project; no good rain in this CCY for 3 years and it looks like this rainy season will fail. Hoping for rains in Sept/October.

Spoke with Jess Chaplin who heads the NRT Carbon Project. Some background on NRT: World’s first large-scale grasslands soil carbon project using the new VM0032 methodology; they are a beta tester. This methodology uses modeled vs measured removal and is the first validated project that works with pastoralist communities. The project is 1.9 million hectares (4.7 million acres) with the goal of improving pastoralist’s grazing lands for 14 communities and improves financial resilience of these communities via carbon credit sales. NRT works with verifiers based in Kenya that help them manage Verra standards (will be connecting with them too). Currently, NRT’s processes are conducted almost exclusively on paper; Jess mentioned a desperate need to digitize their work––from paper records to MRV. Jess and her team will bring me through their processes from start to finish, how they deal with the larger carbon credit ecosystem, how they manage MRV processes, and how they engage with the pastoralist communities they seek to support. She mentioned that they have some exciting projects in the work and will introduce me to this work when I am in Kenya in July––but would like to keep this a bit more low-key as they are working on the storytelling around these projects for a launch later this year; she asked for some help with this too––happy to help :) Will keep posting notes on this thread as we continue conversations and I meet the team in Kenya at the NRT project sites.