Data ReFined #34: State of the VCM, EU's Nature Restoration Law, NOAA's New Weather Satellite

Data ReFined #34: State of the VCM, EU's Nature Restoration Law, NOAA's New Weather Satellite
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The Newsletter about Climate Data, Regenerative Finance, and Climate Risk ⛅

This edition of our biweekly newsletter highlights the importance of satellite and space technology, such as NOAA's new weather satellite with 30-second updates.

We also cover the latest developments in carbon finance, including the European Union's Nature Restoration Law, Calyx Global's report on voluntary carbon market credit quality, Verra's partnership with the Malaysia Forest Fund, and Kita's new carbon insurance product.

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Industry News

The State of Quality in the Voluntary Carbon Market

Calyx Global, a carbon credit rating agency, has published a new report assessing the quality of credits in the voluntary carbon market. While there has been an increase in higher-rated credits across various sectors, forest-based credits rated B or higher are still uncommon.

Is The Voluntary Carbon Market Moving Toward Version 2.0?
A report by Calyx Global sheds light on improving integrity in the voluntary carbon market, highlighting shifts in credit quality and trends.

European Union's Nature Restoration Law

The EU has enacted the Nature Restoration Law, targeting the restoration of 20% of degraded land and sea areas by 2030, and all ecosystems by 2050. This legislation also fosters the development of voluntary credit markets, including biodiversity and carbon credits, creating new opportunities for environmental and economic alignment.

Why is the EU Nature Restoration Law a landmark achievement for Europe’s biodiversity and climate goals?
Although challenges remain, the new EU Nature Restoration Law champions biodiversity, climate goals, and offers exciting opportunities through instruments such as voluntary biodiversity credit markets.

The World Resources Institute published this article, providing extra context to the importance of the Nature Restoration Law.

4 Growing Threats to Europe’s Forests: Logging, Bioenergy, Wildfires and Pests
Europe’s forests face increasing pressures.Impacts include fewer tall forests, climate change-induced wildfires, insect outbreaks, and, most recently, increased wood harvesting to meet additional demand for “home-grown” biomass in response to the Ukraine war and changing energy demands.

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Malaysia’s Forestry Carbon Initiatives

Verra and the Malaysia Forest Fund have signed a memorandum of understanding to certify Malaysia's forestry-based carbon initiatives under Verra's Verified Carbon Standard (VCS). This partnership aims to enhance Malaysia's access to the voluntary carbon market, supporting the scaling and financing of the country's forest preservation efforts.

Verra and Malaysia Forest Fund Sign MOU to Align Country’s Forest Carbon Initiatives with Verified Carbon Standard Program
Putrajaya, Malaysia – June 19, 2024 | The Malaysia Forest Fund (MFF), an agency of the Ministry of Natural Resources and Environmental Sustainability, and Verra, the nonprofit that serves as the world’s leading standards setter for climate action and sustainable development, today announced the signing of a Memorandum of Understanding (MOU) to support alignment of Malaysia’s forestry carbon initiatives with Verra’s Verified Carbon Standard (VCS) Program.

Buffer Insurance in the Voluntary Carbon Market

Kita has introduced the world's first "Buffer Depletion Protection Cover" policy, aimed at safeguarding carbon credit buffers in the voluntary carbon market. The novel insurance solution aims to build trust, enhance liquidity, and support the scalability of carbon projects by offering a clear and regulated mechanism for managing reversal risks and other non-permanence events in carbon credit markets.

Announcing...Buffer Depletion Protection Cover! — Kita
Introducing a world first “Buffer Depletion Protection Cover” policy, protecting Carbon Standards’ carbon credit buffers against depletion  At Kita, we’ve always believed that Voluntary Carbon Market buffers and insurance are complementary. As we wrote one year ago in our report Buffers

Climate Risk and Financial Resilience

Bloomberg's Global Head of Enterprise Risk Product offers insights into best practices for integrating climate risks into financial risk management and regulatory reporting, as well as how to prepare for the upcoming disclosure requirements on climate-related risks.

Building financial resilience: Integrating climate risk into the prudential risk framework | Insights | Bloomberg Professional Services
Dharrini Bala Gadiyaram, Global Head of Enterprise Risk Product at Bloomberg, shares some best practices for integrating climate risk considerations in risk management and regulatory reporting and how financial leaders can best prepare for the challenges ahead.

Physical climate risk assessment platforms, such as Aegis, can help your company understand climate-related risks and provide valuable insights for mandatory disclosures.

From El Niño to La Niña

The cyclical El Niño phase of Earth's climate pattern has ended, transitioning into a neutral phase before La Niña takes over later this summer. This shift predicts a hotter-than-average summer across the U.S., with increased drought risk in the West. The absence of El Niño could lead to a hyperactive Atlantic hurricane season, as La Niña's conditions favor storm formation.

El Niño is dead. Here’s what to expect in the coming months | CNN
El Niño has officially come to an end and the ripples from its demise will shake up weather around the globe.

NOAA's New Climate Satellite

A new geostationary satellite developed by NOAA and NASA, the GOES-U, is set to launch next week. With an update interval of 30 seconds, this satellite provides valuable near-real-time weather observation and environmental data.

Discover the history and future of climate satellites in this 8-minute documentary from NOAA:

Machine Learning Improves Downscaling of Climate Models

MIT researchers developed a machine learning method to improve fine-resolution climate model simulations. The method combines adversarial learning with simplified physics and historical data, reducing costs and speeding up modeling. This leads to more accurate extreme weather predictions for local policymakers.

Machine learning speeds up climate model simulations at finer resolutions, making them usable on local levels
Climate models are a key technology in predicting the impacts of climate change. By running simulations of the Earth’s climate, scientists and policymakers can estimate conditions like sea level rise, flooding, and rising temperatures, and make decisions about how to appropriately respond. But current climate models struggle to provide this information quickly or affordably enough to be useful on smaller scales, such as the size of a city.

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