Summary

Deploy capital to fund carbon project development and secure the forward delivery of nature-based removal credits compatible with C3’s ARBO pool specification.

Motivation

Pursuant to KlimaDAO’s mission of rapidly scaling up the deployment of capital toward high-impact sustainability projects, in September, 2022 we proposed the utilization of a set amount of treasury funds toward financing the development of new carbon projects. This effort drives the coalition-building necessary to accelerate the digital carbon ecosystem’s development, showcasing the collaborative potential of the ReFi space.

ARBO Pool Bootstrapping

C3 currently curates two types of tokenized carbon pools: UBO and NBO. Both of these pools allow the deposit of removal-type credits, but their current curation makes them far more attractive to specific price-classes of credits, and thus technologies (primarily mitigation-type credits). The UBO pool is ideal for renewables and energy efficiency projects, whereas the NBO pool caters to nature-based solutions with a focus on emissions mitigation (e.g. forest protection, improved forest management, and REDD+).

As stated by C3, “In order to meet the needs of clients seeking to diversify their offsetting strategy to include additional emissions removal credits, we are proud to launch the criteria for our ARBO pool criteria (Afforestation and Restoration-based Offset)”.

This proposal directly supports climate action - in partnership with Aither and communities on the ground - as well as providing the KlimaDAO treasury with the necessary tonnage to bootstrap the new ARBO pool and unlock liquidity for an additional class of credits.

The ARBO pool will accept credits from leading registries, including Gold Standard and Verra. See forum proposal linked below for full pool criteria.

Project Support: Kwamisa/Other Reserves Community Forest Project

Project Context

The primary goal of the project activity is to cultivate teak plantations in the degraded forest reserves to improve the livelihood of the local communities and biodiversity, which will ultimately help to combat climate change by increasing the sequestration capacity of carbon dioxide and other greenhouse gasses. In addition, the project activity is also providing needed employment to the forest-fringed communities; supporting community-led natural resource management and regeneration to promote reforestation; improving Nutrition, food security and local livelihoods through sustainable use of forests and trees and related income generation.

The project activity is managed by the Private Afforestation Developers Organisation (PADO), an umbrella organization of private forest plantation developers in Ghana. They are the legal owners of the plantations located in Ghana; Kumasi at Kwamisa Forest Reserve located at Offinso Forest District within the Ashanti Region of Ghana. The reserve lies midway between Kumasi-Techiman and the Kumasi–Sunyani Road, about 35 miles north of Kumasi. The area is approximately bounded by the following coordinates: Latitudes between 7o 05’ North and 7o 14’ North Longitudes between 1o 50’West and 1o 57’West. PADO was incorporated in 2010 as per the Companies code, 1963 (Act 179) as an association and out of it, PADO Investment Limited was established and incorporated in 2016 as a subsidiary and a commercial business entity of PADO.

Project Details

Verra project page: https://registry.verra.org/app/projectDetail/VCS/3425

Methodology: AR-ACM0003

Aither’s full RFC post: https://forum.klimadao.finance/d/175-rfc-arbo-compatible-project-opportunity-aither-x-klimadaov

Credit Issuance & Costs

Units are priced at $15.90/tonne

2023: 10,798 2024: 3,478

Total credits: 14,276 tonnes Total cost: approximately $227,000 (227,000 USDC)

Risk Mitigation

Aither’s history in the carbon market and current efforts to accelerate on-chain carbon adoption make our organization a natural ally to the work that KlimaDAO is undertaking. We believe KlimaDAO’s launch was a watershed moment for the VCM and are hopeful to collaborate with the DAO as we explore pathways to bring our carbon projects toward the digital frontier which is Web3.

Additionally, KlimaDAO has ensured the following parameters are included in a prepared Verified Emissions Reduction Purchase Agreement (VERPA):

• Should a delivery failure occur from this project, Aither will provide ‘like’ credits from a similar project in terms of vintage, certification standard and technology type/methodology.
• Should bridging not be possible at the time of credit delivery, KlimaDAO holds the right to sell the credits at no charge by Aither to another entity. Any gain from such an action will be sent to the DAO wallet. These potential future transactions will be facilitated via Aither’s registry account.