London-based carbon credit rater and data provider Sylvera is opening a new branch in Singapore to leverage the region’s growing carbon market ecosystem, the firm has announced.
Its entry into the city-state has the backing of the Singapore government, with whom it will work with to identify “high-quality” overseas carbon credits.
Lim Wey-Len, senior vice president at Singapore’s Economic Development Board, said at a panel session on the sidelines of the COP28 climate summit in United Arab Emirates that many carbon credit methodologies have been developed but most are not yet contextualised to the region. “Partnership with [Sylvera], and with academia, especially our local universities, will be very important to develop new methodologies that can help us progress the carbon markets in Southeast Asia,” he said.
Samuel Gill, co-founder and president of Sylvera, said Singapore was a “very obvious choice” for its second expansion out of Europe, after announcing a New York office in July.
“Over 20 per cent of the potential for nature-based solutions sit around Singapore, Singapore is at the heart of that potential hub,” Gill said, adding that there is talent, thought leadership and a growing number of carbon market players in the city-state.
Sylvera’s Asia Pacific commercial lead Louis Booth is part of the new office. He was previously based in Europe.
Sylvera’s work with Singapore involves carbon credits to be traded under a United Nations-backed “Article 6.2” mechanism, where countries selling the credits agree to not count them towards domestic emissions reductions, but can gain valuable climate financing through the trade.
Singapore, a major oil refiner and geographically disadvantaged with domestic renewables, is engaged in over a dozen bilateral negotiations under Article 6.2 to offset its greenhouse gas emissions.
Sylvera is one of the familiar names in the growing carbon credit rating industry, among others such as BeZero and Calyx, which provides third-party assessments on the integrity and reliability of carbon offsetting projects. Sylvera has raised nearly US$100 million since its founding in 2020, with the latest US$57 million round landed in July.
Sylvera said its expertise with automated evaluation of carbon projects “will enable Singapore to strengthen its position as Asia’s prime destination for emissions trading”.
At COP28, Sylvera also announced a partnership with Singapore’s carbon exchange AirCarbon Exchange, to create a “Sylvera A-rated nature contract”. Such a contract allows for bulk purchasing of carbon credits from multiple projects that have all been graded highly by the ratings agency.
AirCarbon Exchange head of Asia Pacific Hum Wei Mei said the contract will bring standardisation and help scale-up the carbon market, which has become “quite fragmented” in the past two years, “and almost afraid of its own shadow”.
Macroeconomic headwinds, along with media exposes against large carbon projects, have in recent years deflated the carbon market, though analysts remain optimistic about long-term growth.
Apart from AirCarbon Exchange, Sylvera is also working with other Singapore-based carbon marketplaces Climate Impact X and Ureca.