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First portfolio auction held in the global voluntary carbon market

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Global carbon credit exchange and marketplace Climate Impact X (CIX) has completed a first-ever pilot auction of a portfolio of high-quality carbon credits. The auction successfully cleared 170,000 carbon credits from eight recognised NCS projects curated to form a diversified portfolio, at $8 per tonne.

What is a carbon credit?

A carbon credit is a certificate that represents an independently verified reduction of one metric tonne of CO2 emission.

What does NCS stand for?

Natural Climate Solutions (NCS) involve protection and restoration of natural ecosystems such as forests, wetlands and mangroves. NCS are cost effective and provide significant benefits by supporting biodiversity and generating income for local communities.
CIX’s pilot auction attracted strong interest from many global companies, and the final group of buyers represent different industry segments and active market participants eager to grow the voluntary carbon market: Of the group of buyers, DBS Bank, Singapore Exchange, Standard Chartered and Temasek, being co-investors of CIX, purchased the carbon credits at auction clearing price instead of participating in the auction. The other companies incldue Berge Bulk, Boston Consulting Group, City Developments Limited, ENGIE, Gunung Capital, Marquis Energy Global, Mercuria Energy, SK Energy International, ST Telemedia Global Data Centres, STX Group, Trafigura.
Each of the NCS projects, spanning reforestation and avoided deforestation initiatives – across Africa, Asia and Latin America – demonstrate the high-performance of carbon sequestration and high levels of verified co-benefits, such as supporting biodiversity, along with social and economic development in local communities.

The projects also help support a broad base of verified co-benefits and delivery against UN Sustainable Development Goals. The eight projects collectively support more than 55,000 jobs, improve education for more than 35,000 students, help fund 60 medical facilities and infrastructure projects; plus efforts to protect over 250 threatened species.

Why this auction?

The portfolio auction is the first-of-its-kind in the global voluntary carbon market. By delivering greater transparency, efficiency and risk mitigation for buyers, the pilot auction supports the scaling of the voluntary carbon market, as advocated by the Taskforce on Scaling Voluntary Carbon Markets (TSVCM).
This pilot auction is an opportunity for Singapore-based CIX to demonstrate a new method for scaling the voluntary carbon market. By curating supply into a portfolio, CIX simplifies the buying experience; by leveraging an auction, CIX offers an efficient and competitive price discovery mechanism that establishes a fair market price for both buyers and sellers.

What is CIX?

Jointly established by DBS Bank, Singapore Exchange Limited (SGX), Standard Chartered and Temasek, Climate Impact X (CIX) is a global marketplace and exchange for high-quality carbon credits based in Singapore. CIX maintains a high threshold for quality for carbon credits offered on its platforms and is committed to a high-integrity approach to scaling the voluntary carbon market.

CIX is initially focused on natural climate solutions, which involve the protection and restoration of natural ecosystems like forests and mangroves. To support its quality standards, CIX is working with an ecosystem of partners to harnesses technologies such as satellite monitoring and machine learning that deliver transparent data around project impact and risk.

Going forward, CIX will continue to collaborate with an ecosystem of technology partners who share its vision of building a scalable, trusted and high-quality voluntary carbon market. This includes Sylvera which applies machine learning to satellite data and deep methodological analysis to evaluate projects; with Viridios AI to provide an independent assessment of spot market value of the portfolio; and with platform provider NovaFori to develop the auction technology. CIX has stated that it will leverage the expertise and experience from this pilot to launch regular auctions that will be held in early 2022.