In June 2011, Kevin Starr wrote a blog for the Stanford Social Innovation Review criticising Vestergaard Frandsen ́s approach of using carbon markets to fund the distribution of water filters in the Sustainable Deployment of the Lifestraw Family in Rural Kenya (GS886) project. He claims that many people in Western Kenya don ́t boil their water, and questioned the mechanism for achieving emission reductions through such a project, which considers the concept of Suppressed Demand in baseline setting.
In October 2012, Gold Standard was approached by investigative journalist Tom Heinemann who was investigating carbon trading for a documentary, which screen on 09 September 2013. Heinemann was looking into the same Vestergaard Frandsen Lifestraw project. In Q1 2013, based on a recent visit to the project site, Tom Heinemann raised some concerns about the number of people using the Lifestraw product on the ground as well as the concept of suppressed demand1. Several members of the Gold Standard NGO Supporter Network also raised similar concerns about the usage rates for the Lifestraw project. Throughout the process, Gold Standard maintained a continuous dialog with both the journalist and our NGO supporters who had raised the issue.
To respond to these issues, Gold Standard hired an independent consultant, Berkeley Air Monitoring Group, to conduct a thorough investigation on the usage rates for this project. Berkeley Air Monitoring Group was selected from a group of experts in this field, based on their expertise and their thorough approach to this investigation. The outputs from the study including its scope, results and the decision process to get to these were discussed and agreed by the Gold Standard Technical Advisory Committee (TAC).
In April 2016, atmosfair submitted an official grievance, raising concerns about the usage rates and the plausibility of the emission reductions and baseline scenarios, linked specifically to the application of ‘suppressed demand’. Gold Standard TAC and Secretariat confirmed confidence in the usage rates assessed by the Berkeley Air Monitoring Group investigation and maintained support for the concept of suppressed demand. While considering the grievance closed at that point, Gold Standard committed to increasing transparency and consistency in its grievance process and to hold a future review of the relevance and effectiveness of suppressed demand in carbon markets.
On 14 September 2016, a group of Stanford University academics led by Amy Pickering published a study titled, “Climate and Health Co-Benefits in Low-Income Countries: A Case Study of Carbon Financed Water Filters in Kenya and a Call for Independent Monitoring.” The study presents alternative usage rates for periods that correspond with the monitoring periods for which the Gold Standard issued carbon credits to Vestergaard Frandsen’s Lifestraw project (GS886). At the same time, atmosfair, a competitor to Vestergaard, filed a written complaint against GS886, citing the Stanford study.
On this basis Gold Standard re-opened the grievance, published an investigation plan, and flagged the project in the Markit Registry as being under investigation. The investigation included a comprehensive review of the data collection methods followed by Dr. Pickering and her research team, as well as solicitation of feedback from Vestergaard, Berkeley Air Monitoring Group, the auditor, Dr. Pickering, and other relevant parties. The investigation examined whether the data in the Article was comparable to the data reported by GS866, as well as the credibility of the data collected by Dr. Pickering and her research team. The investigation concluded that there are challenges with comparing the data in the Article with the data reported by GS886 due to (i) a significantly smaller and narrower study population that focused primarily on pregnant women, (ii) a smaller geographical study area that excluded areas with high water turbidity, and (iii) a different definition of a “user.”
Further, the organisation that collected the usage data for the Article, Innovations for Poverty Action (“IPA”), may have had a potential conflict of interest due to its strategic and financial interests in a competing technology and carbon offset project that falls within the same project boundary as GS886.
While Gold Standard does take adverse action against a project that violates its rules, there exist too many challenges with the evidence presented in the Article to make an unequivocal finding - the standard in a case where the complainant requests the cancellation of carbon credits from a registered project that has issued and sold carbon credits.
Gold Standard has published below a final report with findings of fact, analysis, conclusions, and recommendations to resolve the project grievance.