This month, we take a closer look at Amazon, a major corporate buyer with a well-established presence in the market and a growing role in voluntary carbon markets. Combining AlliedOffsets data with wider research, we explore how its VCM activity, credit preferences, and decarbonization strategy have evolved over time.
Amazon retired over 150,000 credits in April, the company’s most prolific month to date when it comes to carbon credit usage.
Furthermore, it announced two offtake deals. First, it agreed to purchase 685,000 from Indian rice projects. The deal is with The Good Rice Alliance, a partnership between Bayer, Shell, and GenZero, which will see Amazon purchase credits from a project that sees 13,000 farmers change their practices in order to reduce methane emissions from rice cultivation.
The second offtake will see Amazon source credits from a spekboom restoration project in South Africa (VCS5027). The project is financed in part by a World Bank impact bond, with Amazon serving as an anchor buyer, committing to a fixed price offtake over the course of more than 10 years. This provides the project predictable cashflows, allowing it to use the agreement to raise further funding from the World Bank.
Turning back to the credits retired in April, Amazon has retired credits from two Tradewater projects that source ozone-depleting substances from the Middle East and transfer them to facilities in Europe to be destroyed. Both projects are CCP-tagged.
Amazon’s activity in the month aligns with the increasingly popular superpollutant plus removal portfolio, with the retired credits and the methane reduction offtake being in the superpollutant category, while the spekboom credits are nature-based removal.
Amazon has been involved in the VCM for some time, though April was its busiest month yet for VCM buying activity.
Amazon had previously purchased direct air capture credits from 1PointFive, and a year ago, it launched its carbon credit service, offering credits to companies it works with. It has also worked with Verra to launch the ABACUS certification for ARR credits using the VM0047 methodology. (As of now, no credits have been ABACUS-tagged, due to the limited supply of VM0047 credits available – the first credits were only issued in the last week.)
With one US tech firm signaling that it is slowing down its VCM activity, Amazon’s leaning in comes just at the right time for a market in need of positive news.