In the upcoming year, the American Forest Foundation (AFF) will host the first of its kind carbon credit auction in the US, offering buyers access to high-quality, nature-based offsets.
The American Forest Foundation Carbon Auction, scheduled for February 2025, is part of the Family Forest Carbon Program, a strategy tailored to assist family forest owners and countryside communities in accessing revenue streams while improving environmental health.
Designed with the vision of providing buyers with a one-stop platform for investing in forest carbon removal, over a period of several weeks the auction will compile all relevant project due diligence resources in one central place, leading to a one-week auction period in February when interested parties will have the chance to bid on credits.
With this effort, the AFF hopes to generate upfront funds that will serve as the lifeblood for accelerating the development pace of nature-based carbon removal projects, considered vital in the global fight against climate change.
In an attempt to put an end to the early financing issues for climate initiatives, the auction will run on hybrid commercial terms, under which the buyers will make partial upfront payments, powering the operational project takeoff, while the rest of the funds will be paid upon delivery.
Companies that choose to invest in carbon credits during the auction will get a discount for their prepayment, locking in a competitive long-term price that will allow them to plan lasting strategies without a risk of increased expenses over time.
The payments by companies will be directly tied to project milestones like landowners and acres enrolled, and verification goals reached.
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The auction will gather all necessary information in regard to the projects in one place, giving buyers simplified access to carbon removal purchases, free of the sometimes confusing processes tied to accessing high-quality credits on the voluntary carbon market.
Buyers will also have the chance to see anonymous competing bids, giving them an idea of the current market pricing tendencies.
As shared by the AFF, the innovative concept based on which the carbon credit auction was created carries the potential to reshape the voluntary carbon market (VCM).
