Climate adaptation likely to cost over US$2B – Jagdeo

…says Govt pursuing even better prices for Guyana’s carbon credits

Climate adaptation measures, a necessary part of Guyana’s sustainable development plans as the fallout from climate change continues to be felt by the most vulnerable countries, could cost Guyana over US$2 billion.
This is according to Vice President Bharrat Jagdeo, who recently said that while the price for preparing Guyana’s coastline for the dangers of climate change is a hefty one, some of the funds can and will be sourced from the sale of carbon credits.

“The proceeds will be used to do some of the things we’ve identified in our expanded LCDS. The initial LCDS focused on mainly the forests, the new one on biodiversity, on integrated water management, on adaptation, the marine economy, and so the significant amount of funds required for adaptation, over maybe US$2 billion in Guyana’s case, just for flood control and water management.”
“That’s our biggest vulnerability. Some of the climate funds will be used for that purpose, some will come from the oil and gas industry. We can’t wait for climate funds or adaptation funds to come through the global mechanism. I think most countries in the Region are waiting for that and it will be a long wait,” Jagdeo said.
Last year, Guyana signed a historic, multi-year US$750 million agreement with Hess Corporation for the purchase of 37.5 million carbon credits. Guyana is, in fact, the first country to conclude the Architecture for REDD+ Transactions (ART) process of certifying its forest carbon.
According to Jagdeo, however, they are continuing to work at the international levels to improve on the prices ranging from US$15 to US$25 per tonne that Guyana secured through this agreement. He explained that negotiations are continuing at the level of the United Nations Framework Convention on Climate Change (UNFCCC).
“Globally we’re pushing the UNFCCC negotiations, to create that room. Because if we can have a compliance market there, the prices would escalate. We got really good prices at $15 per tonne of carbon for the 2016 to 2020 period, it will be $20 for 2021 to 2025 and $25 per tonne between 2026 and 2030.”
“So those are good prices, compared to what is in the voluntary markets now. But it has the potential to go to $80, $90 per tonne. So potentially, this could become a $4, $5 billion deal, depending on if its traded upwards,” the Vice President said.
Guyana’s serialised credits, listed on ART’s public registry, are available to buyers on the global carbon market, including for use by airlines for compliance with the International Civil Aviation Organisation’s global emission reduction programme, CORSIA, as well as for use toward voluntary corporate climate commitments.
Guyana’s completion of the ART process paved the way for other Governments that are looking to receive carbon market finance for success in protecting and restoring forests. At the time Guyana was issued with the credits, 14 other countries and large sub-national jurisdictions are working toward their own issuances of TREES credits.
ART, which is in charge of certifying forest carbon credits so that they can be sold on the international market, had announced its approval in January of Guyana’s registration for 2021 to 2025, as well as the monitoring report for Guyana’s forests.
In a statement, ART noted that it approved these two documents for Guyana and that they are now available for stakeholder comments which must be submitted within 30 days. The first document is a TREES (The REDD+ Environmental Excellence Standard) registration document for 2021 to 2025, while the second is a TREES monitoring report for 2021.
ART’s approval of Guyana’s 2021-2025 registration document and monitoring report are important follow ups on its approval last year of 33.47 million forest carbon credits for Guyana, dating from 2016-2020. These credits were verified by a third-party against ART’s robust environmental and social requirements. (G3)