Gold Standard for the Global Goals
Frequently Asked Questions
What is the added value of Gold Standard for the Global Goals for project developers?
Gold Standard for the Global Goals offers the following benefits to project developers:
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Further differentiate your projects among others in the carbon markets by strengthening safeguards, especially around water and gender, elevating 'co-benefits' to certified SDG contributions, and allowing projects targeting vulnerable communities to distinguish themselves with a 'pro-poor' flag.
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Seek new sources of funding by combining methodologies and issuing products from a single project that were previously only available under distinct standards.
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Ensure relevance of projects post-2020 by enabling issuance of emission reduction statements rather than carbon credits in places where double counting may occur and enhancing the ability to demonstrate contributions to the host country's SDG priorities. Streamline the certification process in the future through a new IT infrastructure that will facilitate project design processes, shorten review periods, automate monitoring where possible, and enhance reporting capabilities.
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In addition, by introducing a Gold Standard renewable energy attribute product (eg, REC) label that is now possible under the Gold Standard for Global Goals, we are working to reduce the supply of renewable energy carbon credits in the market while opening up new markets for Gold Standard renewable energy projects.
Are projects required to apply new methodologies, like the ADALYs methodology?
No. Quantifying and issuing ADALYs and other new products will be optional. The goal of Gold Standard for the Global Goals is to provide flexibility and options for both project developers and funders to quantify, certify the impacts they prioritize – and to allow the monetization of those impacts if they wish. These products can be certified separately and sold separately from VERs or bundled with VERs as appropriate for the project and the funder.
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‘Certified SDG contributions’ arise from the SD matrix completed by project developers using self-proposed indicators coupled with clear rationale, justification and in some cases expert opinion as to how these will positively contribute to an SDG. These correspond to what are currently referred to as ‘co-benefits’ and can be used as part of the project narrative and for reporting purposes. These SDG contributions still come packaged with the VER and cannot be sold separately. Gold Standard is in the process of developing activity-specific SDG matrices to ensure consistency and comparability of SDG contributions.
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Gold Standard Certified SDG ImpactsTM require a Financial Needs Assessment and are based on Gold Standard-approved methodologies. These can be monetised and will therefore be assignable to specific funders on the Gold Standard public registry. Gold Standard Certified SDG ImpactsTM currently include VERs, ADALYs and Water Benefit Certificates, as well as Gold Standard Certified Impact Statements for Black Carbon/SLCPs. Quantification methodologies vary per activity type and Certified SDG Impact.
Can a project still claim co-benefits?
We are repositioning ‘co-benefits’ to ‘SDG contributions’ in an effort to elevate these important impacts to an appropriate level rather than describing development benefits like jobs created, gender empowerment and reduced deforestation as side effects of carbon reductions. SDG contributions will function as ‘co-benefits’ do today. Project developers who wish to monetise additional impacts would have the option of demonstrating Financial Need and applying a Gold Standard-approved methodology to issue Gold Standard Certified SDG Impacts like ADALYs.
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‘Certified SDG contributions’ arise from the sustainable development matrix completed by project developers using self-proposed indicators coupled with clear rationale, justification and in some cases expert opinion as to how these will positively contribute to an SDG. These correspond to what are currently referred to as ‘co-benefits’ and can be used as part of the project narrative and for reporting purposes. Gold Standard is in the process of developing activity-specific SDG matrices to ensure consistency and comparability of SDG contributions. SDG contributions will still be associated with the project and cannot be sold separately.
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Gold Standard Certified SDG ImpactsTM require a Financial Needs Assessment and are based on Gold Standard-approved methodologies. These can be monetised and will therefore be assignable to specific funders on the Gold Standard public registry. Gold Standard Certified SDG ImpactsTM currently include VERs, ADALYs and Water Benefit Certificates, as well as Gold Standard Certified Impact Statements for Black Carbon/short-lived climate pollutants (SLCPs). Quantification methodologies vary per activity type and Certified SDG Impact. Buyers of VERs will able to claim that they have funded climate mitigation action from a project that has also made other SDG contributions.
Can multiple donors support a single project? If so, how do donors claim their SDG certified impact if they are co-financing (with different portions) a specific impact?
Yes there can be multiple donors or funders to one project. The approach taken here is similar to what already happens with development programs which are co-funded by various donor agencies. Funders or sponsors must disclose the exact impacts funded or sponsored in their communications. These will also be disclosed in Gold Standard’s public registry. Claims will have to follow the requirements listed for Gold Standard Certified Projects and the claims guidelines of the relevant Gold Standard Certified SDG Impact (eg VER). A sponsor or funder of Certified SDG Impacts must not make claims for other Certified SDG Impacts that they have not directly funded. They can, however, include a description of all SDG contributions as part of a project narrative, but must indicate clearly and precisely what their funds supported.
Under the new standard, the registration renewal period will be reduced to 5 years, how will this impact small projects? Which projects will be automatically renewed and which projects will be exempted from some of the renewal requirements?
The Gold Standard Technical Governance Committee discussed this issue at length and came to the decision to shift to a 5 year renewal period based on the 5 year review period adopted for nationally determined contributions (NDCs) under the Paris Agreement. This does not mean that our projects will have to overlap their crediting period with NDC cycles. It does means that our projects will have to renew baseline more frequently to take into account any baseline updates that may happen due to updates in NDCs. We are currently working on various activity guidelines like those for renewable energy projects and community focused projects. These activity guidelines will specify which activities will be renewed automatically for, e.g., improved cookstoves projects could be allowed to renew automatically for second crediting period. These will be available with the publication of the standard in June 2017.
Will the micro scale scheme be available under Gold Standard for the Global Goals?
Yes, but we will revamp it to address any shortcomings in the current scheme.
If a project is about to do its stakeholder consultation should it wait for GS4GG?
No. Changes to the stakeholder consultation process are relatively minor from previous versions and project will not be expected to do another consultation in order to transition. The transition guidelines will make provisions for grace periods in some instances. These transition guidelines will be published at the end of April 2017.
Does a project have to do all the SDG Impacts from the start or can it add some later?
New SDG impacts can be added during a project's life cycle but would of course require all monitoring information including baseline data per the methodology. A key principle of claims management is clear attribution and disclosure of funding sources. Therefore, projects will not be able to issue impacts retroactively if other assets (eg, carbon credits) were sold during that period, as this would not have been clear to those funders from the earlier years.
Where does the potential demand for certified SDG impacts comes from? Are those buyers the same as VER buyers or other types of buyers? Do they come from the public sector or the private sector?
Our market research, currently in process and due to report at the end of June 2017, is investigating these sources of demand specifically to those relevant to clean cooking and heating technologies -- black carbon and SLCP reductions, health, poverty alleviation, gender equality and renewable energy access. It is evaluating the merits/efficacy of valuation approaches for funding these impacts and the level of rigour or assurance required to verify impacts.
Preliminary observations suggest that the sources of funding vary quite widely. Private sector funding among corporates shows the preference for impacts that have close relevance to core business operations and supply chain activities, which broadens the potential scope far beyond today's VER buyers. This audience is showing signs of interest in the quantification and certification of SDG impacts of their sustainability initiatives – sometimes but not always through results based payment mechanisms.
Impacts that not only deliver social benefits but also demonstrate reduced costs of government spending – including ADALYs, which clearly lower the burden of disease -- so far seem to resonate with public funders.
Is it possible that the new ADALYs methodology may depress current VER prices for improved cookstoves, as projects that do not apply the ADALYs methodology will no longer be able to claim health impacts?
Cookstove projects can still make health-related claims if they provide expert stakeholder input and clear academic justification for health impacts. In addition, any cookstove project may still claim that 'Many improved cookstoves are associated with reduced smoke, which can lessen exposure to dangerous indoor air pollution.' This proposed specification is designed to protect projects and funders against accusations of overclaiming or 'SDG washing' and to work toward compliance with ISEAL requirements.
Regarding VER prices, we are acutely aware that prices for carbon credits are depressed and do not reflect the value of carbon reductions, even less the real value of the additional project benefits. Market information indicates that while health related claims are important for buyers, the main motivation to buy a VER from a cookstove project remains for offsetting purposes. And while cookstove projects remain attractive to buyers, prices have significantly decreased as supply of credits from cookstove projects has steadily increased over the years. It is reasonable to conclude that the key driver of prices remains supply and demand dynamics. Further, as the research around cookstoves and their impacts matures, the exposure of a project or funder to overclaiming could be a greater downside risk than an upside opportunity to overcome the pricing trends driven by the supply/demand dynamic. Clarity on the future of carbon markets and progress on the demand side are therefore of utmost importance.
