How businesses can harness carbon credits to accelerate their climate action

Carbon credits are designed to offset a business’s residual carbon emissions after exhausting its internal reduction efforts. Companies can also compliment emission reduction strategies by supporting UK Nature Based projects as a further demonstration of their commitment to the environment. This not only contributes to the UK’s journey towards net-zero but also offers tangible benefits to businesses.

In this blog, we expand on the benefits that carbon credits have to offer, and how Caledonian Climate work alongside landowners to provide businesses with a credible, robust supply from our peatland restoration projects.

 

What are carbon credits?

A verified Peatland Carbon Unit (carbon credit), generated under the Peatland Code, represents a permanent emission reduction of one tonne of CO₂ equivalent (tCO₂e) emissions into the atmosphere.

The impact of activities or processes that reduce or remove CO₂ can be measured and quantified as sellable carbon credits to businesses looking to offset their residual carbon emissions.

Caledonian Climate’s peatland restoration projects generate credible, independently verified carbon credits for businesses. Degraded peatlands contribute massively to the global carbon budget, while restoring them ensures the CO₂ remains locked away for good. Investing in this nature-based solution enhances biodiversity, boosts water quality, aids flood management and prevents greenhouse emissions, supporting local skilled jobs while enabling businesses to reach their net-zero goals.

 

The Peatland Code

The Peatland Code is the certification standard for peatland restoration in the UK.

Registering a project with the Peatland Code - as all Caledonian Climate projects are – ensures the carbon credits generated are verified through an independent assessment process, overseen by the International Union for the Conservation of Nature, endorsed by the Scottish and UK Governments and audited by UKAS to ensure the highest level of integrity.

The Peatland Code stands as a beacon of credibility in the realm of carbon offsetting. It offers a rigorous framework for the restoration and long-term conservation of peatlands; invaluable ecosystems that sequester and lock away significant amounts of carbon dioxide.

By investing in projects that have been validated to The Peatland Code, businesses can secure verified carbon credits, providing assurance of their environmental impact mitigation efforts. These credits serve as tangible proof of a company's commitment to sustainability while facilitating compliance with regulatory requirements and enhancing corporate reputation.

The Peatland Code is currently in the process of becoming ICROA endorsed – a key milestone in the standards evolution. Following ICROA endorsement, the IUCN are targeting accreditation to the Core Carbon Principles of the ICVCM – another important step.

Currently issued as version 2.0, with 2.1 imminent, the Code will consult on version 3.0 in the Spring of 2025. This next version of the Code will look to bundle Biodiversity benefits into the Peatland Code standard, providing an extra layer of demonstrable value to project owners and investors.

 

Carbon credits for landowners

From a financial perspective, carbon credits can represent a valuable asset, with potential for positive returns both environmentally and financially. Selling carbon credits can be a rewarding enterprise for landowners, generating additional long term revenue streams while enhancing the biodiversity of less favoured land, reducing emissions and mitigating against future policy risks. 

Landowners looking to sell carbon credits have an obligation to Monitor, Maintain, Report and Independently Verify their project over the long term. It is the ‘carbon finance’ (revenues derived from the sale of carbon credits) that provides the essential funding to make sure that these crucial obligations carried out. Without them, a project may not deliver on its intended outcomes – carbon credit sales are essential to a projects long term success.

As the demand for carbon offsetting continues to rise, driven by both regulatory mandates and voluntary commitments, the value of carbon credits is expected to appreciate.

 

The benefits of carbon credits for businesses

The advantages of integrating carbon credits into business strategies extend far beyond environmental stewardship. Firstly, carbon credits offer a means of offsetting unavoidable emissions, allowing businesses to achieve carbon neutrality or even carbon negativity.

In doing so, companies can align with consumer preferences for environmentally conscious brands, thereby enhancing brand loyalty and market competitiveness.

Additionally, investing in carbon credits can mitigate risks associated with fluctuating carbon pricing and regulatory uncertainty, providing a hedge against future carbon-related costs.

Moreover, embracing carbon credits aligns businesses with broader sustainability agendas, fostering partnerships and collaborations across industries. By actively participating in carbon offset projects, companies contribute to collective efforts to combat climate change while strengthening relationships with stakeholders, including customers, investors, and communities.

 

Overall, the rise of carbon credits presents a compelling opportunity for businesses to not only mitigate their environmental impact, but also drive sustainable growth and resilience. Through partnering with organisations like Caledonian Climate, businesses can access verified carbon credits, unlocking a huge range of benefits - ranging from environmental conservation to employee wellbeing and market competitiveness.

By incorporating carbon credits as a strategic tool, businesses can pave the way towards a more sustainable and prosperous future for both them and the planet.

 

Interesting in finding out more about the services we offer landowners and businesses? Head here to learn more.