How carbon credits play a key role in the decarbonization of the Food and Beverage Industry

By Brennan Spellacy, CEO and Co-Founder, Patch and Miranda Gorman, PhD, Head of Climate Solutions and Science Planet FWD

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Consumer industry sustainability leaders seeking to decarbonize their operations must employ several approaches to do so effectively. They must first measure emissions, and implement strategies to make meaningful reductions of these emissions, such as adopting renewable energy and more efficient operations. However, we know that it isn’t possible to prevent 100% of emissions. Planet FWD is already helping food industry leaders like Compass Group to measure and reduce emissions, and now, in partnership with Patch, are able to support our customers in building a voluntary carbon credit strategy that:

1. Fits into each customer’s decarbonization journey
2. Supports each customer’s corporate climate commitment
3. Helps drive important investment to high-integrity climate solutions

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Supporting F&B industry climate action: Planet FWD + Patch

Planet FWD’s AI-powered decarbonization platform simplifies the process of measuring and reducing a company’s climate footprint. Moving beyond average data and estimates, Planet FWD’s technology rapidly models product-level emissions from farm to compost bin. Companies can also understand corporate emissions, including office operations and those from its full supply chain, in as little as a few weeks. 

Our partnership with Patch leverages their Radius platform, which makes it easy for our clients to access a curated set of global climate projects that align to our methodologies and frameworks. 

• Concrete Mineralization from CarbonCure 
• Biochar from Dutch Carboneers India
• Enhanced Rock Weathering from Lithos Carbon

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Through the Patch platform, Planet FWD customers may browse projects, third-party ratings, and rich data in our marketplace to

• purchase from a single developer
• purchase curated portfolios
• facilitate multi-year offtake purchases that align to your climate commitments. 

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The Patch climate advisory team can provide highly-informed guidance to provide guidance and support.  Patch supports businesses like Seed, Just Salad, and Aviva to define and implement strategies that amplify climate impact.

How the Voluntary Carbon Market (VCM) helps fund important climate solutions

Researchers estimate there is a 66% chance we surpass the pivotal 1.5℃ of warming between now and 2027. The situation is urgent - we must scale all climate solutions to reduce emissions and remove greenhouse gasses now. The IPCC is clear that protecting and restoring natural carbon sinks and removing atmospheric carbon are critical climate imperatives. And the path to near-term scale for many of these projects runs through the voluntary carbon market. By 2050, a cumulative total of 165 billion tonnes of carbon removal will be required, amounting to as much as 10 billion tonnes per year in order to limit climate change to within 1.5C. In order to do this, current Carbon Dioxide Removal (CDR) technology must be scaled by orders of magnitude.

Governments are introducing new legislation that will help guide the VCM. For example, the Inflation Reduction Act helps to incentivize the use of carbon capture and storage technologies and is credited with spurring $213 billion in new clean investments across the U.S. in the past year — a 37% increase from the year before and a 165% increase from five years ago. The recently passed California Climate Corporate Data Accountability Act would require all businesses with more than $1 billion in revenue to publicly disclose their beginning with Scope 1 and 2 emissions, and then requiring disclosure of Scope 3 emissions by 2027. Additional legislative changes are anticipated in many regions, from the European Union, the United Kingdom, Canada and beyond. While these changes will likely bring more clarity and guidance for business leaders, the fact is that action is required now, and the Voluntary Carbon Market (VCM) has emerged to address this need. 

The VCM provides companies with the opportunity to purchase voluntary carbon credits. Each credit represents 1 metric tonne of CO2e mitigation. A range of technologies are available; some have been operational for decades, including forestry and renewable energy, and in recent years, new technologies have emerged that bring novel approaches to carbon avoidance and removal, such as direct air capture, enhanced weathering and biochar. Developers of carbon credits use revenue from the sale of these credits to build their investment cases and scale their operations.

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How carbon credits help companies achieve climate commitments

Increasingly, consumers are becoming more sophisticated in how they scrutinize the brands they do business with, and in particular they are paying attention to these brands’ climate commitments. 

The first step is measuring and significantly reducing emissions. Reputable corporate claims require starting with emissions measurement and direct reduction, and then residuals compensation and regular reporting. Even as terminology continues to evolve, management of residual emissions through the purchase of voluntary carbon credits is a key component of all major claims. 

The VCM is continually evolving, with an influx of standards bodies aiming to fill gaps and provide structure, which, in the past, has sometimes led to more market confusion. However, with the ICVCM’s release of the Core Carbon Principles earlier this year, the recent publication of VCMI’s Claims Code of Practice, and the forthcoming “beyond value chain mitigation” guidance from SBTi, the market is reaching a point of convergence on best practices. This increasing collaboration is a welcome step to further scale the VCM and help businesses take informed action, yet it is still a space that requires leaders to invest time and effort. And there are the outstanding questions like:

1. How many credits do I need to buy?
2. Which credits should I buy?

Building a measurement and reduction strategy with Planet FWD can answer how much of your emissions can be reduced and what needs to be addressed through purchasing credits. Then, through our partnership, Patch can help inform which credits are impactful and aligned with your company’s mission. 

Crafting an impactful carbon credit strategy

Companies have many decisions to make in purchasing carbon credits, from determining mechanism (avoidance vs. removal), technology, vintage and other co-benefits. In addition, the company must consider what tonnage is required, and define a price point that aligns to budgets.

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Avoidance and reduction carbon credits

Incentivize keeping CO₂ from entering the atmosphere.

Decreased renewable energy costs have made clean power economical in many parts of the world. But avoidance projects (such as plugging abandoned and orphaned oil & gas wells to stop methane emissions from these sources) still require the funding carbon credits provide to be feasible. Likewise, nature-based avoidance credits (such as deforestation prevention) can provide a financial mechanism to preserve critical ecosystems that maintain the balance of our planet.

Removal carbon credits 

Incentivize taking CO₂ out of the atmosphere.

Our species has spent centuries engineering tech and extracting natural resources, knocking the planet out of balance. Now, we’ll need new engineered and nature-based carbon removal solutions to restore that balance. With the monetization provided by selling carbon credits, projects (such as direct air capture) can become viable at commercial scale to remove and durably sequester millions of tonnes of CO₂.

Learn more about the Science of Carbon Credits

Through this partnership, it’s easier than ever for Food & Beverage companies to tackle their decarbonization journey with precision, from accurate and detailed measurement and reduction to integrating high-integrity carbon credits.

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Want to learn more? Our climate expert team at Planet FWD, and our carbon credit experts at Patch are available to support. 

Book a consultation.

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About the Authors

Brennan Spellacy, CEO and Co-Founder, Patch 

Brennan is the CEO & Co-Founder of Patch, the platform scaling unified climate action. Prior to founding Patch, Brennan worked in a range of product & engineering roles at Sonder and Shopify. He received a degree in chemical engineering from McGill University.

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Miranda Gorman, PhD, Head of Climate Solutions and Science Planet FWD

Head of Climate Solutions & Science at Planet FWD, Miranda Gorman, Ph.D. is an environmental engineer whose research focuses on the sustainability of material resources. At Planet FWD, she leans on her background in circularity and life cycle assessments of materials to contribute to Planet FWDs scientific methodology and rigor. She also directs Planet FWD’s team of 9 Research Scientists in developing and validating the scientific rigor of Planet FWD data and methodology. 

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