CPR Verde will guarantee delivery for carbon market, in a similar way that the well-known Rural Product Certificate (CPR) guarantees delivery of agribusiness products to the market. With this instrument in force, there is the necessary legal security to finally move this large market here in Brazil. Extend how eumostro and its partner HDOM can help your company in this process.
What is CPR Verde?
The Green (Verde) Rural Product Certificate (CPR) is an instrument related to the conservation and recovery activities of native forests and their biomes, opening the market alternative for companies interested in voluntarily offsetting their greenhouse gas (GHG) emissions. The new Agro Law (Law No. 13.986/2020, Art. 42) introduced the possibility of issuing CPRs backed by environmental assets in the following modalities:
- Reduction of greenhouse gas emissions;
- Increase or maintenance of forest carbon stock;
- Reduction of deforestation and degradation of native vegetation;
- Biodiversity conservation;
- Conservation of water resources;
- Soil conservation;
- Other ecosystem benefits.
In practice, CPR Verde represents a voluntary payment instrument for environmental services (PES), an economic mechanism established in the Forest Code (Law nº 12.651/2012). Now the rural producer is encouraged to produce at the same time as he preserves and, thus, starts receiving extra income. At CPR Verde, the product to be traded will be carbon sequestered (stored) by the forest, water preservation and its ecosystem.
Another analogy is to think that CPR Verde is a “carbon credit”, a unit of measurement that each corresponds to one ton of carbon dioxide equivalent (tCO2e). These measures are used to calculate the reduction in greenhouse gas (GHG) emissions and their possible trading value.
How to generate CPR Verde?
To generate CPRs Verde it is necessary to “prove” that your project voluntarily contributes to at least one of the seven items mentioned above. This means that mandatory preservation areas of rural properties, such as Permanent Preservation Areas (PPAs) or legal reserves (RL), are not eligible for CPR Verde.
Having an eligible area (project), it is then necessary to hire a specialized technical service to estimate ecosystem services, for example, carbon stock in forest and/or soil, conservation of biodiversity, etc. Afterwards, a project is prepared and, if requested by the buyer, an independent auditor is hired to evaluate the project.
HDOM, for example, has more than 12 years of experience in forest inventories, carbon stock estimation, socio-environmental diagnosis and design of projects aimed at avoided deforestation.
CPRs Verde are then registered with B3, earning an identity number, and can be traded. The validation mechanisms are agreed between the parties, that is, defined by mutual agreement between the buyer and seller of the Green CPRs..
Who buys CPR Verde?
They are companies or people who voluntarily wish to contribute to, for example, keeping the forest standing, preserving the ecosystem services that the forest provides. Green CPRs, for example, can be used to offset the purchasing company’s greenhouse gas (GHG) emissions, or even be resold for speculative purposes.
It is important to emphasize that the payment of the Green CPRs is often made in installments and upon compliance with the agreed conditions. Often the buyer deposits into a linked account where the producer can only withdraw upon proof of these agreements.
In this case, eumostro is the platform for recording and communicating what is done in the carbon project. It facilitates the way of reporting not only the activities agreed by the project, but also the positive impact generated.
The use of blockchain technology, for example, backs up the services performed, bringing more transparency and security to the market that purchases voluntary carbon credits (CPR Verde).
CPR Verde will guarantee delivery for carbon market
CPR Verde is a market mechanism, in addition to command and control (State). It is a new instrument to combat illegal deforestation, as it encourages payment for environmental services, promoting advantages for producers who choose to keep the forest standing and need additional resources to help in the governance of the area. On the other hand, it allows companies that want to contribute with a positive impact, to have legal ways to do so. CPR Verde will guarantee delivery for carbon market.
If you are a rural producer, talk to eumostro right now and make the ESG assurance for your Green CPR project. If you are a company, use the eusample to show carbon offsetting, communicating its positive impact to society.