South Pole issues first ever Social Carbon credits in SE Asia

South Pole Carbon Asset Management Ltd, one of the world's leading carbon offsetting companies, has announced in a press statement the first-ever issuance of carbon credits in Southeast Asia developed under the Social Carbon standard.

After the recent successful issuance of Social Carbon credits from a small hydro project in the mountains of Yunnan, South China, a first-ever outside Brazil where the standard originated, Zurich-based South Pole Carbon has followed with its news project, this time in Indonesia.

In collaboration with a local NGO, a series of long-term social activities have been implemented against the Social Carbon standard at a run-of-river hydro plant on the island of Sumatra. Now, the first carbon credits with both Verified Carbon Standard and Social Carbon certification have been issued in the Markit Environmental Registry.

Project in a remote area of Indonesia, using a natural height difference of about 500m to generate sustainable energy, without the need for a retaining dam.

Renat Heuberger, South Pole's CEO who set up the company's Indonesian presence five years ago said: "This hydropower project is a fantastic example of how to get the most out of Indonesia's rich renewable energy resources. No dams, no flooding of land, no resettlement and yet as much as 80 megawatts of clean electricity are installed, creating additional jobs and income for the local population."

With Indonesia's economy and population growing, the demand for power is on a steady rise, putting global climate and local environment at risk if satisfied in a business-as-usual manner.

In this situation, carbon revenues are an important driver of investments into renewable energy in a country still dependent on fossil fuels, despite its rich but mostly unleashed natural sources of energy, such as geothermal and hydro power.

South Pole has facilitated several emission reduction projects in the renewable energy sector in the country which are managed from its Jakarta office.

Social demand

South Pole says companies buying carbon offsets to balance their footprint are today looking for more than just emission reductions. They are aware of the importance of sustainable development in the affected regions and are willing to pay a premium for projects with a record of social and environmental benefits.

This, it says, is where the Social Carbon standard comes into play, providing project developers and buyers with clear guidelines on supporting local communities on a long term basis, with annual third-party checks and reports.

Social Carbon elements of the the Sumatran small hydro project includes free medical treatment of locals in the nearby villages of Silalahi and Parbuluhan, which are far from the Medan, the closest city. In addition, the local tradition of weaving, an important source of income for women, is supported by regular donations of thread and electricity.

The local school in Silalahi has received work and material support during building construction and electricity and water installations to improve education opportunities for local youth. The multi-religious communities of North Sumatra have also received several donations to enable better conditions in mosques and churches.

Through these and other activities, the project supports local communities in a rural region far from urban centers, thus mitigating migration pressure to the cities and rising the standard of living. Re-invested in such manner, carbon credits prove to be an important tool for sustainable development and to ensure a true North-South collaboration.