Rethinking Sectoral Scopes: Why Classification Matters for Carbon Market Integrity

In our submission to Verra’s Version 5 consultation, Eco Sustainability focused on the proposed revisions to sectoral scopes. While some questions on excluded project activity types (3.1) were not directly applicable to our work, we felt it was important to weigh in on how projects are classified under the VCS Program (3.2).

Why split AFOLU?

We support Verra’s proposal to split AFOLU into two separate sectoral scopes:

1. Forestry and other land use

2. Agriculture

The rationale is simple. These two project types behave very differently. Forestry projects deal with long-term carbon stock management and sequestration, often over decades. Agriculture projects, on the other hand, are usually focused on short-term emission reductions or avoidance, tied to seasonal cycles.

If we group them under the same category, methodologies and risk assessments become blurred. By separating them, Verra helps ensure that methodologies are precise, monitoring protocols are relevant, and project risks are evaluated appropriately. For buyers and ratings agencies, this separation makes the carbon market more transparent. A forestry project is not the same as an agricultural one, and the classification system should make that distinction clear.

Alignment with CDM and PACM

We also recommended that Verra align its sectoral scopes as much as possible with CDM and PACM. This isn’t about bureaucracy — it’s about market efficiency. Many developers operate across multiple standards. If the classification systems are aligned, project documentation is smoother, cross-recognition between registries becomes more feasible, and the path toward Article 6 integration is clearer.

For example, alignment with PACM makes it easier for voluntary market projects to be incorporated into national inventories and NDC tracking. That kind of compatibility is critical as governments begin to fold voluntary carbon market activities into their official climate strategies.

Blue carbon and aquaculture

We also flagged a gap in the classification system around blue carbon. With Verra proposing a new “Oceans and Marine Resources” category, there needs to be clear guidance on where mangroves, salt marshes, and seagrasses fall. These ecosystems are currently treated under AFOLU, but their unique role in coastal carbon sequestration suggests they may sit more naturally under the marine category. Clarity here would prevent confusion for both developers and auditors.

We also suggested that aquaculture projects — such as seaweed farming or shellfish aquaculture — should start being recognized. The IPCC has acknowledged their potential, and while methodologies are still emerging, including aquaculture in the classification system signals support for innovation and helps attract responsible early investment.

Distinguishing ARR purposes

Finally, we supported Verra’s idea to differentiate ARR (afforestation, reforestation, and revegetation) activities based on their purpose. Ecosystem restoration should be treated differently from commercial or productive forestry. But this only works if Verra provides clear criteria: for example, whether restoration means using native species, avoiding intensive harvesting, and delivering measurable biodiversity or watershed benefits.

For productive forestry, Verra should also spell out what counts — such as industrial tree crops or agroforestry — so the line between agriculture and forestry is not blurred.

Why classification matters

At first glance, sectoral scopes may look like a purely technical question. But they shape how projects are designed, assessed, and understood by the market. If the categories are unclear, developers waste time navigating grey areas, verifiers struggle with consistency, and buyers lose confidence.

Getting the classification system right is not just about administrative tidiness. It’s about building a carbon market that is transparent, comparable, and trusted.

About Eco Sustainability

As a trusted advisor on sustainability and climate policy, Eco Sustainability is not only aligned with global standards, we help shape them by contributing to technical consultations and international standard-setting processes.