Opening Forests with a new standard of MRV
As anthropogenic influence drastically grows, so grows the pressing need to remove the carbon we pump into our atmosphere, as this may help to limit global temperature rise to below 2 degrees celsius by 2050 (IPCC). Ensuring temperature regulation at this scale is a worldwide effort that demands collective action, as well as immediate, effective, and scalable solutions. Promoting a mindset of forest conservation and regeneration, and ensuring an aligned commitment to mitigation goals, calls for a reformation in sustainable development action tracking that prioritizes transparency, accessibility, and legitimacy. The moment is ripe for us to tune in to the true value of our greatest climate mitigator: nature.
Trees are the protectors of biodiversity and the foundation of nearly every land-based ecosystem on Earth. The world’s terrestrial forests are our most effective natural carbon alleviator — annually, they store 15.6 billion tons of carbon from the atmosphere in their biomass and soil (Pan et al. 2011, Pan et al. 2013). Unfortunately, due to deforestation, we have lost about 400 million hectares of tree coverage in the past 20 years — this amounts to over 8 billion tons of stored carbon being released back into the atmosphere each year, so we lose more than half of their annual storage potential (VisualCapitalist, GlobalForestWatch). The most efficient and sustainable way to mitigate climate change is to increase forest coverage by curtailing deforestation practices, and promoting restoration, which will allow these degraded lands to return to their natural states (Lewis et. al. 2019).
Modern forest preservation and rehabilitation requires that we monitor and verify our sustainable development efforts with methods that are attainable to all participants, regardless of funding. This means reshaping our current approaches to tracking the implementation progress of conservation and reforestation activities. At present, the Measurement, Reporting, and Verification (MRV) standards we use to monitor mitigation actions are expensive and lack the technical modernization and accessibility needed to scale globally (Köhl et. al. 2020, WorldBank, Basak et. al. 2016). We desperately need an MRV system that incentivises accountability through transparency of ground-truth and validation, and reshapes forest monitoring and management to better fit the people who are actually using it.
“Measurement, reporting, and verification (MRV) is foundational to our global response to climate change.”— MRV Technical Paper, Low Emission Capacity Building Programme (LECB), United Nations Development Programme.
Measurement, Reporting, and Verification (MRV) is a tri-step process used to prove impact and track changes over time as they relate to emissions, ecological health, or sustainable development actions (World Resource Institute). MRV is widely used to verify all manner of climate-mitigation efforts, from energy-use reduction, to reforestation, to direct air capture. It is the integral step in proving an intended impact has been achieved.
Within the context of forest monitoring, MRV involves three interconnected procedures:
- Direct Measurement of data (such as tree height, diameter, species, on-site photos, etc.).
- Standardized data Reporting by compilation into an inventory.
- Verification of reported data to ensure reliability and validity.
These processes are broken down in greater detail towards the end of this article.
The History of MRV
Before we get into OFP’s revolutionary MRV standard, it is important to reflect on how far forest data monitoring has come over the years. Prior to the emergence of the ‘MRV’ concept by the United Nations Framework Convention on Climate Change (UNFCCC) in 2007 at COP 13, governments and forestation operations utilized various forms of monitoring and evaluation to assess their progress (Bali Action Plan, 2007).
Prior to COP13 in 2007, forest project measurement hinged primarily on the first two steps of MRV: Data Measurement and Reporting. However, the lack of clarity and legitimacy in reported data incentivized the need for standardized data review. Hence, the Bali Action Plan established during COP 13 highlighted the importance of data Verification as a crucial third element to ensure accuracy of data and calculations. This trifecta MRV approach was consolidated by the Paris Agreement (Article 9) as a step towards a coordinated system that can be used to more effectively validate carbon sequestration measurement.
Traditional MRV Process
Although present MRV is a giant leap forward from a monitoring standpoint, the traditional MRV used today is still inaccessible to the vast majority of forest projects. For a landowner to enroll their land for carbon offsetting, and accrue carbon credits, they must jump through many (usually expensive and tedious) hoops.
First, landowners need to register and pay for a partnership with a verification body or carbon registry, and must follow their rigid protocols. These protocols are convoluted and complex, often involving custom methodology development and the bureaucratic process of bringing a project through such a methodology. Thus, landowners generally need to hire and pay for an external project developer, who has the experience and resources necessary to follow the multiplex ordinances set by the verification body in order to move the project forward.
In other words, the MRV is carried out by project developers who have trained specifically in the process of collecting and reporting data that centralized verification bodies will ultimately approve. But this proves to be a bottlenecking approach with three key pinch-points: 1. The need to identify and hire a project developer that is typically based far away from the project location, and 2. The requirement to push all data collected by the project developer manually through one central (and separate) Validation and Verification (VVB) entity for a third-party review and 3. The need to ultimately bring this data through the centralized entity itself to issue credits.
So, once the project has been registered, the project developer must employ this verifier to accept or deny all project data. It is important to call out that the incentives of these independent verifiers are not unbiased and can be misaligned in their reason for approving projects as disputing a project, or its data, is a timely process. Over the long-haul, VVBs that are known to regularly dispute claims or be overly-time consuming in the verification of data (due to a complicated process) may not be suitable for continued verification.
Once the project has been verified, it is traditional for landowners, or the developer working on their behalf, to hire a broker, to hold, control, and trade their accrued carbon credits. This means that the users must trust the word of a broker to get them a fair deal, and to take a fair cut, in a transaction for which they have very little transparency or grounding in what is actually fair.
Restrictions of Present MRV
The high cost of legacy MRV means that most projects cannot afford it, or are too small to generate enough value to overcome these costs (Basak et. al. 2016). In most standards, there are size requirements that exclude small projects entirely, or heavily restrict their carbon eligibility (VCS REDD, Gold Standard).
Often, local communities and stakeholders do not receive a fair share of the value being created due to the large number of intermediaries involved. Communities are left out of the narrative and are taken advantage of by larger companies and organizations. Additionally, the centralized process often entails flying consultants to project sites to take measurements, a congested approach with a large carbon footprint. Until recently, more efficient and accessible alternatives to this centralized MRV standard have not been extensively explored.
Centralized MRV is a siloed, closed system. Performing MRV in this way is a highly restrictive and biased process that ultimately results in opaque verifications, leading to the production of opaque credits. These credits are then issued and sold into a system weighed down by assets of value that are false or misleading, restricting liquid market growth and price discovery. For these reasons, the current centralized MRV systems in place are not usually digitized, scalable, or accessible (WorldBank).
Open Forest Protocol’s MRV Standard
OFP is running a system upgrade on the predominantly inaccessible and centralized MRV standards used today. OFP’s human-centric technology is deliberately designed to be used by forest projects of any size — so projects as small as 0.1 hectares are welcome to use our MRV. By choice, we decided to provide a free MRV tool to increase reach, use, and scale of forest monitoring worldwide, and our no-cost MRV is open for all to use. By building OFP on the infinitely scalable, user-friendly, and climate-neutral NEAR Protocol blockchain, our open-access MRV is fast, reliable, and secure. As the first-ever Web3-native MRV standard, our protocol has integrated the properties inherent to blockchain, such as immutability and decentralization, directly into the MRV framework. We deliver robust verification of environmental data, a pool of decentralized Validators that work in tandem with us and our Project Operators (POs).
By using multiple validators, OFP’s methods are both carbon-efficient and decentralized. This lays the foundation for an accessible and inclusive MRV system, built with grassroots projects in mind, and allows annual verification to be done at a low cost to the projects on the ground. Let’s dive into the intricacies of OFPs MRV, starting with the measurement process.
Forest measurement involves physical data collection by the Project Operator (PO) and anyone they delegate to go into the field (these people are known as “Field Agents”). PO’s upload their project area to our dashboard as a KML file and create a digital representation of their project. Once the land area is uploaded, our dashboard randomly generates an algorithmically-determined number of sample plots within each forest area.
Then, the PO assigns their Field Agents, who will visit these plots to record the diameter, height, health, and a few other metrics of the trees within each plot. Field Agents use the Forester mobile application — OFP’s smartphone app (available on both Apple and Android devices) — to upload their collected data. The Forester app does not require WiFi or reception to collect data, meaning that data can be collected in the field, regardless of connectivity. Upon returning to a zone with Wifi or internet access, the data is then sent back to the dashboard. These measurements are conducted once every six months, for the two first years of the project, and then annually thenceforth.
Once the Projects have submitted their collected data to the dashboard, it appears on the public blockchain. Here, validators can conveniently access the data, which leads us to the final step of MRV: Verification.
This process is carried out by a global, collaborative, decentralized, and diverse network of Validators with extensive experience in remote sensing, GIS, and forestation data analysis. Validators on OFP consist of qualified organizations and individuals who collectively verify field data and additional information. The verification process on OFP takes less than 60 days and goes through three main stages: Validation, Challenge, and Escalation.
For more about validators on OFP, check out our Validator 101 article!
Validation (30 days)
In this first stage, the data uploaded by POs is sent to the validators. Validators assess this data using both project history, and their individual capabilities. The invaluable skills and resources provided by this network of validators include remote sensing technologies, deep knowledge of particular ecosystem growth patterns, statistical analytics, and AI, all of which they use to verify the accuracy, legitimacy, and validity of the data uploads. On site forest verification is also an option for validators that are geographically nearby the projects.
OFP’s platform organizes a network of validators who use OPN tokens to vote to approve or deny the data. They can choose to vote with however many tokens they wish. Every validator is able to access, view and give their vote on every project data upload.
It is important to note that each validator works independently, and cannot see how other validators have voted when assessing the validity of the data. This is done to remove bias in voting and validation. If the majority of validators for a particular data upload reach the same conclusion (whether to approve or deny the data), then that data upload is accordingly approved or denied.
Challenge (7 days)
At the end of the 30 day validation period, any validator in the OFP network can challenge the standing validation decision over a seven-day period. For example, if the initial validation decision was to approve the data upload, but a remote sensing validator discovers information that indicates the project data should be denied, they can vote to overturn the initial decision. In order for a challenge period to successfully overturn the standing validation decision, enough validators must vote to match the standing validation decision amount. If there are not enough votes during the challenge period to overturn the validation decision, then the validation decision is finalized and the forest project moves on to their next stage.
Escalation (7–21 days)
If the challenge is not successful, then the validation period ends. However, if the challenge is successful, there is a subsequent escalation period that consists of up to three, 7-day escalation periods similar in rules to the challenge period. It is during these “escalation” periods that validators can double and raise the challenge vote amount in order to overturn the challenge decision. After the first escalation period, if a conclusion is not met, the challenge will move onto the next escalation period. This repeats until either not enough votes are cast to overturn the previous decision, or the third escalation period is reached.
An Open MRV For Social Good
Prioritizing people and collaboration, our MRV overhauls the existing paradigm with an open system that creates an immutable timeline of existence, growth, and historicity for the lifecycle of forests.
The open-source collective verification of forest data through a network of validators is a far more rigorous and transparent process that ensures any claims around tree growth and carbon storage are highly legitimized. OFP’s inclusive platform, and free-to-use MRV standard is accessible to forestation projects of all sizes, regardless of location, or funding.
OFP’s mainnet just launched, and we are excited to onboard our first wave of Project Operators and Validators. Stay tuned for more OFP reads and updates. If you are passionate or curious about what we are building and have questions, thoughts, or desire to engage, join our community today.