On 17 April 2025 the UK Government’s Department for Energy Security & Net Zero issued their consultation on raising integrity in the Voluntary Carbon and Nature Markets (“VCNM”). The consultation focuses on their six principles for VCMN integrity, which were first launched at COP29 in November 2024.
What is the purpose of the consultation?
This consultation comes as a response to requests for clarity on the Government's approach to these markets. It marks an active approach from the UK Government to encourage businesses to not only use carbon credits to decrease their carbon footprint, but also to reflect on their overall decarbonisation strategy and guide them towards best practice.
The consultation underscores the UK Government's dedication to fulfilling their international climate obligations and meeting ambitious net-zero targets. It also aims to position the UK as a global leader in establishing robust voluntary market mechanisms that drive high-quality investment in high-integrity carbon and nature finance.
Key Themes
Key themes in the consultation include:
- Legal harmonisation: The UK Government recognises that the inconsistent treatment of carbon credits across jurisdictions leads to uncertainty and can lead to legal risks where credits are being traded internationally, discouraging involvement in the market. The UK Government therefore supports harmonising the definitions of carbon credits across jurisdictions, to both increase legal certainty and market confidence.
- Holistic approach: The consultation emphasises the need to adopt a holistic approach, which they suggest should include setting ambitious internal targets with a time frame for minimising and eliminating environmental impacts at their source and providing plans for how they will meet these targets.
- Complementary Carbon credits: The consultation emphasizes that carbon credits should complement a company's initiatives to reduce emissions, rather than serve as a substitute, stressing that they should be integrated into the company’s broader net-zero strategy.
- Leader in Carbon Standards: The consultation heralds the UK as a leader in establishing robust voluntary market mechanisms and points to the Woodland Carbon Code and the Peatland Code. The consultation states that these initiatives underscore the UK's commitment to becoming a global leader in robust, voluntary market mechanisms that support decarbonisation strategies.
Deadline for Responses
The deadline for responding to the consultation is 10 July 2025 and therefore it is important to get any views and responses submitted promptly.
The Government requests that the responses provided are in direct response to the specific queries raised in the consultation.
Woodland Carbon Code Consultation
This comes at the same time as the Woodland Carbon Code team (“WCC team”) consulting on a new version of the Woodland Carbon Code (“WCC”). The consultation aims to enhance the clarity and accessibility of the WCC and ensure its alignment with international carbon standards. A report will then be published summarising the feedback and the WCC team’s responses on 1 July 2025. Key proposed changes to the code include updated regulations to provide support for projects on crofted land, a revised minimum duration of 40 years for projects and also the introduction of a small wood process to improve the accessibility of the code for smaller projects.
As is the case for the VCNM consultation, the improvements to the code seek to maintain the code’s reputation as a high-integrity carbon standard, informed by the latest data and industry best practices.
If you have any queries on either consultation, please contact Graeme Leith or your usual Brodies contact.
Please see the links below to the consultations.
Contributors
Partner
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