In Singapore, carbon-tax liable companies can only purchase government-approved carbon credits which have been identified to be high-quality and truly beneficial to the climate, based on a list of eligibility criteria.
The Republic’s eligibility list takes reference from the Carbon Offsetting and Reduction Scheme for International Aviation (Corsia) – which is considered the most rigorous and reputable of offsetting schemes.
The credits used by Singapore’s firms to offset their emissions are counted towards Singapore’s national climate target, of reaching net-zero emissions by 2050. Ghana, in return, has to “add” this same amount of emissions back to their emissions inventory.
Mr Law Heng Dean, managing director of Pollination’s Singapore office, said that while the demand for credits in Singapore may not be significant due to the nation’s small size, the emphasis on quality will send a signal to the rest of the market, which can hopefully stimulate the development of high-quality projects.
Cookstoves and green mobility
Ms Molly Brown, head of carbon strategy from Kenya-based company Burn told The Straits Times that the firm hopes to issue credits from its two cookstove projects in Ghana from early next year.
“We’re exploring opportunities with this Ghana-Singapore bilateral deal, which would allow projects approved by both governments to sell credits to Singapore companies to offset their carbon tax,” she added.
Ms Brown said she expects that both governments will give their approval for the project by the end of this year, and that credits can be issued as early as next year. This will be in time for companies in Singapore to declare their use of carbon credits by June 2025 as part of their carbon tax filings for the 2024 financial year, she added.
The first project entails selling electric cookstoves to communities in urban areas like Accra, Ghana’s capital city, at subsidised rates, while the second project entails subsidising the cost of charcoal stoves for communities living in rural areas.
Another firm interested in developing carbon projects in Ghana is South Korean renewable energy company EcoLinks, which aims to distribute 100,000 charcoal-based cookstoves to local communities to replace traditional cooking methods involving open fires.
But its chief executive Johnson Penn said buyers from Singapore are still looking for greater clarity if the credits from EcoLinks project will be approved by the Singapore Government for carbon tax offsetting.
As for green mobility, co-founder and chief executive of Wahu Mobility Valerie Labi said carbon credits could help provide the financing needed to green Ghana’s transport sector away from diesel vehicles to electric vehicles (EV) instead.
“Many of Ghana’s vehicles will be reaching the end of their lifespan in the next few years, and we want to help them make the switch to EVs in that time,” said Ms Labi.
Under a Ghana-Switzerland bilateral deal, the company is looking to supply a fleet of some 100,000 e-bikes for delivery riders at subsidised prices, replacing the use of fossil fuel vehicles.
Wahu is hoping to explore a similar project with Singapore entities, now that the carbon credit agreement has been signed between both countries, she added.
