Swiss carbon finance consultancy South Pole has partnered GenZero to launch the Asia Centre of Carbon Excellence (ACCE) in Singapore. Supported by the Singapore Economic Development Board (EDB), ACCE will focus on novel projects in the region.
In the near term, these projects include the early decommissioning of coal-fired power plants (CFPPs), fostering the development of green hydrogen and green ammonia and helping governments and businesses understand the compliance carbon markets.
Further down the line, ACCE hopes to encourage the adoption of green shipping fuels, explore carbon capture and storage (CCS) technologies and support the implementation of carbon pricing instruments, such as the EU carbon border adjustment mechanisms (CBAM).
Unveiled on the sidelines of Temasek’s Ecosperity Week 2024 on April 17, ACCE will collaborate with regional corporations and governments to explore opportunities for carbon project development, both in Asia and globally.
According to ACCE, this will help clients to meet their emission reduction targets in a cost-effective manner and accelerate climate action.
According to South Pole, it is already designing and applying carbon finance solutions across Asia through the Coal to Clean Credit initiative (CCCI) with The Rockefeller Foundation.
The CCCI seeks to unlock carbon finance to accelerate the early retirement of CFPPs and replace them with renewable energy.
The first CCCI pilot project under consideration in the Philippines could avoid up to 19 million tonnes of carbon dioxide emissions, announced the Philippines-headquartered Acen Corporation and The Rockefeller Foundation on April 17.
ACCE aims to multiply these sorts of pioneering efforts in Asia.
ACCE also aims to deepen financial skill sets. Some examples include tailored approaches to blending climate, carbon and corporate financing and restructuring business models.
Staff from South Pole
At a media briefing, South Pole’s interim chief executive officer John Davis says there are no specific hiring targets for the centre, but staff will be assigned from South Pole’s existing team in the initial stage. Looking ahead, ACCE may also train staff from GenZero’s team or hire new staff.
“We start with organic growth,” says Davis in response to queries from The Edge Singapore. “We are not going to, all of a sudden, have 50 people in it. It will be in line with where we see the markets going. We will also train people in Singapore.”
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Many projects in Southeast Asia are not yet scalable, says Frederick Teo, CEO of GenZero. “Things like sustainable farming, some aspects of agriculture, many different kinds of core carbon projects are not quite ready.”
Temasek-owned investment firm GenZero is a minority shareholder in South Pole.
The launch of ACCE is in line with Singapore’s ambition to establish a carbon ecosystem hub here, adds Teo. “This is an important dimension of how we can grow the carbon markets. This is really about networks. They require consolidation and co-location, so there is greater potential for collaboration.”
Both Teo and Davis declined to reveal EDB’s investment into the centre. With the ACCE’s focus on thought leadership and policy advisory, the centre “isn’t really a business”, says Teo. Hence, “the question of investment” is not significant, he adds.
GenZero doubles down on carbon
The launch comes on the third and final day of the GenZero Climate Summit, which features panels on the carbon markets, climate tech and legal developments in the area.
South Pole did not participate in the main event on April 16, which saw an afternoon of panels featuring fellow carbon market players Verra and Gold Standard, as well as representatives from the Integrity Council for the Voluntary Carbon Market (ICVCM) and the Voluntary Carbon Markets Integrity Initiative (VCMI).
Last year, a slew of media exposés accused carbon credit players like Verra, Gold Standard and South Pole of overstating the actual environmental impact of their products. After months of dismissing the claims, Verra’s founding CEO stepped down in June 2023.
Renat Heuberger, co-founder of South Pole, stepped down as CEO in November 2023, two weeks after the company terminated its contract with Carbon Green Investments, which owned and developed the now-controversial Kariba carbon offset project in Zimbabwe.
Davis, South Pole’s commercial director for Asia Pacific, stepped up as interim CEO of the Zurich-based company. Founded in 2006, South Pole has been involved in the carbon markets for close to 20 years.
Last December, Davis spoke on a panel alongside Teo at the COP28 Singapore Pavilion in Dubai, where he urged governments to support the voluntary carbon markets.
In response to an audience question then about whether the voluntary carbon markets would benefit from a floor price, Davis said a “well-functioning market” should not require one. “We’ve had ups and downs; we’ve seen these curves. I think what we’re about now [is] building where the carbon market needs to be going, and that has to include much bigger investment from governments”.
The financial players are “ready to go”, and the “mechanisms” of the carbon markets are in place, he added. “You will see prices absolutely move in the right direction; I’m very positive about that. The question is getting the market operating correctly.”
Infographics: South Pole
