HomeCarbon NewsRussian Petrochemical Giant Plans to use Forest Carbon Credits to Offset Emissions

Russian Petrochemical Giant Plans to use Forest Carbon Credits to Offset Emissions

Sibur PJSC intends to offset part of its emissions beginning in 2024 by exploiting the carbon-capture potential of Russia’s vast forests. Sibur will explore purchasing carbon credits from projects that plant trees or increase the ability of existing woods to absorb CO2, making it one of the first Russian firms to do so.

Sibur is already assisting with a pilot carbon monitoring project in western Siberia to examine the potential of local forests as carbon sinks.

The Russian government is eager to capitalize on the “carbon sink” potential of its enormous forests, but such initiatives have been criticized by climate experts.

President Vladimir Putin estimated in April that Russia’s biosphere absorbs roughly 2.5 billion tonnes of CO2 equivalent each year, however this amount has to be confirmed scientifically.

Carbon-offset schemes have been criticized by scientists and campaigners for a lack of adequate monitoring. Europe, which aims to be the world’s first climate-neutral continent by 2050, does not accept any offset contributions in its emissions-reduction strategy.

According to Sibur’s head of sustainable development, Sibur wants to proceed with the offsets because “they are essential to our investors, our clients; it is precisely one of those situations when market needs go beyond regulatory expectations.”

To maintain a level playing field for domestic businesses, the EU intends to impose a charge on emissions contained in some imported goods. The so-called Carbon Border Adjustment Mechanism (CBAM) would apply to businesses such as cement and power, and would be implemented as early as 2023. The EU has said that countries with comparable emission-reduction efforts may be exempt from the charge.

Later this July, the European Commission is expected to release a draught legislation outlining the mechanism’s specifics. According to Russia’s Energy Ministry, the levy may cost the country’s oil and gas industry $3 billion to $4 billion each year.

Sibur is concerned about the likelihood of the tax, but has yet to submit an estimate for its own possible losses and is waiting for the commission’s recommendation. The firm is revising its environmental, social, and governance plan through 2025, which will be available in the second half of this year and may contain more aggressive emission-reduction objectives.

Source: https://www.bnnbloomberg.ca/sibur-plans-to-use-russia-s-forests-to-offset-carbon-from-2024-1.1609726

SourceBloomberg
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