The 6.4 SBM recently published the SBM Standard for activities on removals which sheds light on key points to consider when generating or investing in removals.

The standard came into force on October 9 2024.

Some key definitions:
Removals are the outcomes of processes by which greenhouse gases are removed from the atmosphere as a result of deliberate human activities and are either destroyed or durably stored through anthropogenic activities. 
Avoidable reversals are reversals caused by factors over which the activity participants have influence or control;
Unavoidable reversals are reversals caused by factors over which the activity participants have no influence or control.

Monitoring

1.     This should be carried out based on data derived from measurements, sampling, remote sensing, third party sources and published literature that are robust and statistically representative, conservative and take appropriate account of the associated uncertainties.

2.     A monitoring plan is mandatory and must be regularly reviewed and updated, especially if there are changes in risk factors or regulations.

3.     Methodologies must include provisions for monitoring and mitigating any risks identified through the Sustainable Development Tool, including through the FPIC process for Indigenous People affected by the project activity.

Reporting
1.     Participants are required to prepare a monitoring report after implementing the monitoring activities specified in the monitoring plan.
2.     The maximum permissible interval between the submission of two consecutive monitoring reports after the first monitoring report shall be between one and five years.
3.     The monitoring report should include information on the activities and methods, the estimated net removals, data collected, any GHG release events, information on how reversal risk was assessed and addressed and information on any negative environmental and social impacts and how these have been addressed.

Post-crediting period monitoring and reporting 

1.     After the crediting period ends, monitoring must continue to assess whether stored GHGs remain secured or if any reversals have occurred. No credits will be issued during this phase.

Accounting for removals

1.     The net change in GHG storage (removals minus emissions) must be calculated. Projects are only eligible for credits (A6.4ERs) if the net removals are positive.

2.     Removals must be directly anthropogenic (human-caused) to qualify for crediting, and any reversal or crediting deficit must be accounted for in future periods.

3.     Where an activity involving removals also results in reductions, the accounting of removals and reductions shall be separated in the monitoring report in accordance with the relevant methodology.

Methodology at renewal of crediting period

1.     At the renewal of the crediting period, the activity participants shall apply the latest version of the applicable methodology.

Addressing reversal 

1.    Reversal risk assessment: 

a.     A risk assessment must be conducted to identify and mitigate reversal risks, which can range from financial instability, regulatory uncertainty, political or social instability, legal risks to natural disasters (e.g., fires, floods).

b.     A risk rating is assigned to each project, which determines how many credits (A6.4ERs) must be transferred to the Reversal Risk Buffer Pool Account as insurance against potential reversals.

c.     This should be reviewed and reviewed every five years.

2. Reversal notifications and actions

a. If a reversal occurs, participants must notify the Supervisory Body within 30 days and submit a report detailing the event. Based on this, the Supervisory Body will suspend crediting and assess the magnitude of the reversal.

b. If the reversal is deemed avoidable, participants must replenish the Reversal Risk Buffer Pool Account.

3. Remediation of reversal

a. Reversals must be remediated by cancelling the appropriate amount of A6.4ERs from the Buffer Pool. Activity participants are responsible for addressing avoidable reversals and may need to secure insurance for this risk.

Avoidance of leakage
Projects must prevent leakage, where GHG emissions outside the project boundary increase as a result of the removal activity. This is accounted for in the calculation of net removals.

Environmental and Social Impacts
Projects must apply environmental and social safeguards to minimize or avoid negative impacts, particularly concerning human rights and the rights of Indigenous Peoples. They must comply with the Article 6.4 Sustainable Development Tool and other relevant standards.