Sylvera’s approach to Biochar ratings

 An assessment overview outlines Sylvera’s approach to assessing Biochar projects of potential strengths and risks for buyers to consider. Currently, data disclosures in the space do not meet our thresholds required to produce our in-depth, rigorous Ratings. 

‍With the right data disclosures and collaboration with developers, we can provide the deep project-level insights needed to inform buyers’ investment due diligence and help bring these technologies to scale faster. If you’re a project developer interested in having Sylvera rate your project to help prove impact and optimize investment, reach out to our team. 

Further details on the Sylvera assessment overview creation process can be found in our Frameworks & Processes White Paper.

There is high demand in the market for engineered Carbon Dioxide Removal (CDR) projects, such as biochar. There are very few CDR projects that have delivered ex-post removals credits; the majority of buyer activity has been in forward purchases of CDR credits. As a category, biochar is one of the only options for buyers to procure engineered CDR credits today.

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Sylvera is actively working with stakeholders in this space to share data on projects in hopes of catalyzing scale for the biochar market.

What is biochar?

Biochar projects are removal credits that aim to maximize the production of biochar predominantly through pyrolysis. Pyrolysis is the heating and/or burning of an element in an oxygen-absent, controlled environment. The biochar produced is abundant in carbon, in addition to being stable and having numerous applications. 

The input to the process is primarily plant and animal biomass, coming from many sources including, for example, a forest management company with wood chips or a farmer with grass and crop residue. The biomass is normally sourced locally from the surrounding forests or agricultural lands. 

The alternative use of this biomass is minimal, as it is either burnt or left to degrade. The quality of the biomass (including moisture content) has a direct impact on the quality of the biochar created. Woody biomass from forest thinnings is an example of a high-quality input. This input has to be dried and prepared for the pyrolysis plant.

A pyrolysis plant heats up the biomass in the absence of oxygen at high temperatures (up to 800C). The process creates other co-products such as bio-oil and excess thermal energy, which can be sold for additional revenue streams. Alternative revenue streams, in addition to those derived from the sale of carbon credits, have meaningful implications for the additionality of biochar projects, as these revenue streams impact the extent to which carbon finance is required for these projects to be economically viable. 

Biochar is predominantly used as a soil additive. Research has shown that adding biochar can increase soil fertility and protect soil from natural risks such as flooding and erosion. It is highly stable, meaning it is unlikely to decompose over time, protecting most of the carbon stored for the next 100 years and beyond. Nevertheless, the rate of decomposition can increase based on the temperature of the soil. For example, if the biochar is exposed to high temperatures for a long period of time, then it will likely decompose faster. 

How Sylvera assesses biochar credit quality

The Sylvera rating is derived from a combination of carbon, additionality and permanence scores. These three core pillars are combined in a series of matrices to ensure that underperformance in one area is not overshadowed by high performance in others. 

Carbon score‍

Our carbon score verifies whether the project has delivered on its carbon claims by comparing permanence adjustment factors, or rates of decay, for the project’s biochar, to Sylvera’s calculated factor using third-party data. All biochar used in soil applications is  subject to decay, resulting in emissions released into the atmosphere. If a project calculates net GHG removals using a permanence adjustment factor, or rate of decay, that does not account for emitted carbon then there is a risk the project has delivered less carbon removals relative to the amount verified.

Additionality

Sylvera’s additionality score assesses the likelihood the project activities would have been implemented in absence of the carbon revenues. It also quantifies the likelihood and extent the project is over-issuing credits due to an underestimation of life cycle emissions or the overestimation of the stability of the biochar stemming from its chemical composition.

Permanence

Permanence refers to the risk that the avoided emissions will later be reversed and released back into the atmosphere. Our permanence score uses a risk matrix approach to quantify major risks to carbon stock including: pests and pathogens, fire, storm and wind, flood, drought, and anthropogenic. The final score is calculated considering the additive and maximum risks present in the project. Sylvera’s permanence helps buyers distinguish the relative degree of non-permanence (or reversal of carbon storage) risk between projects. 

Co-benefits

Sylvera’s co-benefits score examines the extent to which the project is implementing activities that support local biodiversity and communities, as well as the scale and likely impact of these activities. We use geospatial analysis and leverage our partnership with IBAT to assess the background level of biodiversity that is within the project area, using threatened species, biodiversity, and protected area data. When assessing community impact, we utilize data disclosed by project developers and the SDG framework to triangulate a project’s community impact. 

The use of biochar in soil applications has associated biodiversity co-benefits such as increased soil health and fertility, as well as improved moisture retention that can help conserve water use in crop production. However, there is a notable lack of community co-benefits in the design of biochar projects.