Assessing the quality of carbon credit rating agencies

The document evaluates four carbon credit rating agencies (BeZero, Calyx Global, Sylvera, and Renoster), finding that while their frameworks generally support higher market integrity, significant discrepancies exist in how they assess additionality, non-permanence, and leakage. These differences can lead to starkly contrasting ratings for the same project, potentially confusing buyers and risking the legitimization of low-quality credits. The brief recommends that agencies adopt a 100-year reversal risk period, incorporate safeguards into overall quality scores, and increase transparency of their frameworks. It further advises buyers to move away from 'carbon neutrality' claims and instead use ratings to understand the specific trade-offs and nuances of the credits they purchase.

• Rating agencies often produce divergent ratings for the same project, which can create market confusion and risk legitimizing low-quality carbon credits.
• There is a lack of uniformity in how non-permanence is assessed; only Calyx Global and Sylvera use a 100-year time frame, and only Calyx provides different ratings based on credit vintage.
• Approaches to leakage vary significantly: Renoster excludes leakage risk from its main credit quality evaluation, and Sylvera does not systematically assess market leakage for all project types.
• Additionality is not weighted consistently across agencies; some frameworks allow projects with low climate integrity to still receive medium ratings.
• No rating agency currently incorporates safeguards—rules to prevent harm to local communities, indigenous peoples, or the environment—into the overall credit quality score.
• Transparency regarding assessment frameworks and the public availability of ratings is uneven across the four agencies.
• The vast majority of ratings from the assessed agencies indicate that carbon credits should not be used for offsetting purposes, with over 98% of ratings falling below the highest possible score.

APA

Faecks, B., & Dufrasne, G. (2023). Assessing the quality of carbon credit rating agencies. Carbon Market Watch. https://carbonmarketwatch.org/wp-content/uploads/2023/09/CMW_Policybriefing_rating_raters-v2.pdf

Chicago

Faecks, Benja, and Gilles Dufrasne. Assessing the quality of carbon credit rating agencies. Carbon Market Watch, 2023. https://carbonmarketwatch.org/wp-content/uploads/2023/09/CMW_Policybriefing_rating_raters-v2.pdf.

Wikipedia

{{cite report |last1=Faecks |first1=Benja |last2=Dufrasne |first2=Gilles |title=Assessing the quality of carbon credit rating agencies |publisher=Carbon Market Watch |date=11 September 2023 |url=https://carbonmarketwatch.org/wp-content/uploads/2023/09/CMW_Policybriefing_rating_raters-v2.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{faecks2023assessing, author = {Faecks, Benja and Dufrasne, Gilles}, title = {{Assessing the quality of carbon credit rating agencies}}, institution = {Carbon Market Watch}, year = {2023}, month = sep, url = {https://carbonmarketwatch.org/wp-content/uploads/2023/09/CMW_Policybriefing_rating_raters-v2.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }