Gold Standard
Gold Standard (GS) is a quality standard for carbon emission reduction projects with added sustainable development benefits and guaranteed environmental integrity. Gold Standard projects adhere to best practices and methodology: they employ renewable energy or energy efficiency technologies, actively seek local participation in project design resulting in demonstrable sustainable development benefits. Gold standard for CDM projects was launched in 2003 and methodology for VER projects was launched in May 2006.
It has to be however kept in mind that Gold standard is just a certificate for a CDM / VER project issued and it may / may not mean much to other buyers for that project. Therefore having a Gold standard certification for a project does not mean that, the project is way ahead than other non-Gold standard projects.
It is only a perception and therefore only some organizations / buyers give much value for Gold-standard. However, those organizations / buyers who recognize Gold-standard as a measurement yardstick usually will pay a higher price for the CER / VER from a Gold Standard project than a non-Gold standard project. It is to be remembered that like CDM consideration, for a Gold Standard project also a project entity has to consider (and supported by documentary evidences) that they wish to proceed with a certain project as a Gold-standard project. In such cases the costs incurred (CDM costs for Gold standard certification) is also higher than a normal project which does not have any Gold standard.
Gold Standard projects exclusively employ renewable energy and energy efficiency technologies. Gold Standard methodology was created to encourage the shift from a fossil fuel based economy to a renewable energy economy. In the Gold Standard, all voluntary and compliance projects use the UNFCCC’s additionality tool irrespective of the project size. This is especially important in the voluntary market.
Gold Standard project developers invite local stakeholders to conduct two consultation meetings (one in the initial stages of the project and one right before validation) to make sure the project responds to local concerns regarding the environmental, social impacts and the local economy. Gold Standard project developers use a sustainable development matrix to calculate the impact of the project with the help of these consultations. Only projects with an overall positive impact on the environment, social network and local economy are considered Gold Standard.
Not all the CDM CERs and voluntary emission reductions are eligible for Gold Standards. Only Renewable Energy Projects, energy efficiency projects, methane to energy projects and hydro projects of size < 15 MW are eligible under gold standard. Gold standard for certified emission reductions follows the same procedure as CDM along with its own requirements. Gold standard will charge a fee of 0.01 USD for each CER.
GS for Voluntary emission reduction refers to three types of projects. They are micro scale (0-5,000 tonnes of CO2e per year), small scale (5,000-15,000 tonnes of CO2e per year) and large scale (> 15,000 tonnes of CO2e per year) projects.
Securing finance for VER project requires a number of additional steps compared to the conventional project development cycle. These steps entail additional expenditure for implementation and/or validation and verification. Voluntary offset projects must reasonably demonstrate that the emission reductions from the project are additional to what would have happened in the absence of the project.
To be considered additional for Gold standard, the project should have measurability of emission reductions, introducing technology transfer or knowledge innovation to the host country and compliance with UNFCCC’s additionality tool. There should be no public announcement without it, being a voluntary offset project and the project should not employ Official Development Assistance for purchasing VER credits.
Gold standard will charge a fee of 10 Euro cents for each VER through small and large scale projects and 15 Euro cents for micro scale projects. Gold Standard registry serves as the project database for Gold Standard CDM/JI and voluntary offset projects and as a book of record for tracking issuance, transferring, and retirement of Gold Standard Voluntary Emissions Reduction (VER) credits.
Project developers seeking Gold Standard certification for their projects are required to have an account in the registry. Any party, including non-project developers, such as traders, marketers and end-use customers wishing to hold, transfer or retire VER credits may establish an account in the registry. The Gold Standard registry will only track VER credits originating from voluntary offset projects that have been certified by the Gold Standard. Gold Standard labeled CERs will be tracked by the official UNFCCC registry system. For services related to gold standard CDM/VER projects, contact us.