In Conversation Amy Kessler: CAR in Latin America
May 13, 2022 by Charlie Bell
We sat down with Amy Kessler from the Climate Action Reserve (CAR) to discuss their progress in supporting forestry-based offset projects in Mexico and Latin America.
Key Takeaways:
- CAR takes a holistic approach when developing and implementing Mexican forestry protocols in order to maximise social benefits and remain aligned with local community practices. Their protocols are waiting on alignment with Mexico’s National REDD+ Strategy.
- Supply of Mexico-based forestry credits is expected to increase due to rapid project growth – 56 registered projects have generated 500,000 credits thus far. There are more than 100 unregistered projects in the pipeline.
- The Reserve is planning the expansion of its protocols into Latin America and hopes to emulate the successes seen in Mexico and the US.
Amy Kessler is the Director of Latin American Operations at the Climate Action Reserve (CAR). Having joined the Reserve seven years ago, she now oversees the development and implementation of their protocols throughout Latin America. As a keen traveller, she has lived in many places throughout Europe and Latin America; After completing her undergraduate degree in biology and master’s degree in international environmental policy, she moved to El Salvador to work with local communities in supporting the management of mangrove forests in the Bay of Jiquilisco.
CC: Thanks for taking the time to talk with us! Could you briefly describe the current landscape of offset projects in Mexico?
AK: Mexico is a global leader in carbon markets, and developed one of the first national Emissions Trading Schemes (ETS) in the whole of the Americas. We first started developing Mexico forestry protocols in 2010. Mexico runs a rather unique ‘ejido’ system, in which the federal government grants local communities land ownership. As a result, 80% of existing forests in Mexico are in the hands of these small communities. We therefore take a holistic and landscape-based approach to ensure our protocols are aligned with how they manage their lands; For each protocol we’ll form an extensive work group, which takes inputs from sector experts from that jurisdiction, government agencies, NGOs and representatives from the ejido communities. You’ll also often see a mixture of protocol types, such as IFM, reforestation and urban forestry, within a single project.
CC: Do you commonly implement a mixture of avoidance- and removal-based projects?
AK: All our activities increase long-term carbon sequestration, whether that’s in agricultural or urban environments. We don’t include avoided emissions, however, as that would happen at a jurisdictional level; the Secretary of Environmental and Natural Resources of Mexico and the National Forestry Commission are still in the process of implementing their national REDD+ strategy, we aligned our protocols with this strategy. It’s an ongoing process.
CC: What does the current credit supply look like, and could you make projections over the next 5-10 years?
AK: Currently there are 116 listed projects in Mexico, of which 56 have been registered. From these registered projects about 500,000 credits have been issued. We will see this continue to increase as new projects come in and already listed projects see further growth. I envision another 30-50 projects in Mexico developing this year, with each project generating approximately 5,000-12,000 credits annually.
CC: Is there a typical buyer profile for these credits, and what might their motivations for choosing these projects in particular be?
AK: Buyers in general are becoming more conscientious of the key principles in the carbon market, especially those such as additionality and permanence. These buyers are suited to credits issued by the Reserve, since their additionality is well-documented and we have a rigorous 100-year permanence framework in place. Furthermore, buyers are increasingly looking beyond the carbon aspect and seeking projects which provide co-benefits. This is an appealing characteristic of our programs, since the projects are largely communal, offer a number of social benefits and have to comply with social safeguards. Overall, the market needs to recognise the quality of these programs and commitment of the communities involved. This is already taking effect and is reflected in higher credit prices, which I think is a good outcome.
CC: Can you see any potential barriers to the widespread adoption of these projects in Mexico?
AK: Our work in Mexico has grown very quickly, from a handful of projects three years ago to many more today. A potential challenge is in making sure the current demand continues, but, given the projections, it looks promising. Some buyers need an immense quantity of credits, so establishing how to produce at scale will also be important. Permanence is always a big challenge with any forest protocol, especially at a time when forest fires are increasing in frequency. Again, managing this effectively comes down to the quality and rigour of the protocol.
CC: You mentioned the Reserve may be expanding into the rest of Latin America, would you be able to elaborate on this?
AK: We’ve started having more discussions with players from other jurisdictions in Latin America, who have seen the success of our protocols in Mexico and are keen to have similar protocols in place within their own regions. We have historically been tied to North America as it is very time-consuming to move into new jurisdictions, so we’re now internally evaluating how to do this efficiently whilst retaining the same rigorous processes. I can absolutely see the same holistic framework we’ve used in Mexico working in the rest of Latin America, however. Particularly exciting regions include Colombia, which has its own carbon tax and market in the works, and Panama, which is developing its own national voluntary market. Costa Rica is another leader in this space, and Peru is also on the way. It’s an exciting time.
