This article is still under construction!
Karina This article was published on 13 May 2021.
Here is an incomplete list of the existing funding mechanisms for waste management projects. As we’ve just started working on this list, the entries appear in random order and many are still missing. The goal is to list as many as possible, even if we don’t endorse some of them.
A plastic offset credit (often referred to simply as plastic credit) is a tradable certificate that provides the credit holder with the right to offset their consumption of virgin plastic or generation of plastic waste. WWF defines a plastic credit as “a transferable unit representing a specific quantity of plastic that has been collected from the environment”. The idea is to create a market mechanism that puts a price on waste that currently has little or no value. For example, a company in Europe that produces PET bottles from virgin plastic could purchase credits for the equivalent (tonne-for-tonne) amount of plastic to be collected in Southeast Asia to claim to be “plastic neutral” by having offset its plastic footprint.
“To solve the problem of plastic pollution at scale, we need market-based solutions that can be used at scale and replicated worldwide; market instruments such as credits provide the basis for a cost efficient and environmentally sound solution for plastic recovery and recycling.” said Pedro Moura Costa, president of BVRio. According to Sinclair Vincent, manager of standards development at Verra, “this investing mechanism allows the finance to flow directly to the plastic recovery or recycling efforts that are going on outside of the corporate value chain”. “This is the only way to mobilise corporate capital at scale to plug the waste management funding gap in the developing world; this is the only non-philanthropic solution which is working today”, said Tom Peacock-Nazil, the founder of Seven Clean Seas.
The plastic credit market is still in its infancy, and there is no single definition for what counts as a plastic credit. Various definitions, standards and certification programs are currently in use across different organizations. Many, but not all, programs require collection or processing plastic material which would otherwise not get collected or be processed, thus creating impact that goes beyond existing baseline efforts, known as additionality.
There are seven types of actors involved in the plastic credit market:
- Organisations that define standards (methodologies and mechanisms by which credits can be issued)
- Organisations that develop projects that will result in plastic credits
- Organisations that execute projects that result in plastic credits
- Organisations that verify whether the projects has led to the expected result and deserves to be credited
- Organisations that generate credits (for recovered or recycled plastics) that can be sold
- Organisations that promote or broker the purchase of credits
- Buyers (manufacturers of plastic products, investment firms trading credits and eco-minded consumers) who can make a public claim about the credits once they’ve purchased them
Often a single organisation plays multiple roles, for example, a standards developer might also be the verifier, or a project developer might also be the promoter, which might lead to a conflict of interest.
There are more that 450 public development banks. Most of them are national, only 46 public development banks are international. According to Finance in Common public development banks account for 10% of global annual public and private investments.