Launched in 2016, Climate Trust Capital (CTC) is a private equity style fund investing in projects that generate carbon offset credits while providing market-rate returns. Through its investments, it aims to generate carbon credits that equate to sequestering 2 million tons of CO2 emissions over ten years.
CTC is a for-profit investment manager, a wholly-owned subsidiary of the Climate Trust (not-for-profit). CTC invests in early-stage, US-based carbon offset projects like grassland conservation, biogas plants and forestry. These projects are certified by the Climate Action Reserve, a carbon credit accreditor, ensuring that the generated carbon credits are transparent, monitored and verified.161 The fund’s revenues are generated from selling credits on the voluntary carbon markets and traded on the California cap-and-trade program, leveraging market-based incentives to turn a profit. Within its projects, it often partners with mission-aligned partners on the ground.
The fund was brought to existence through a $5.5 million programme-related grant from the David and Lucile Packard Foundation.162
Since 2019, the fund has reached $40 million in carbon project funding commitments, and is fully invested in seven projects.163 Examples of these projects include: a $2.2 million dollar investment in a 113,000-acre improved forest management project in Maine that was developed in accordance with the California Air Resources Board protocol for U.S. Forest Projects;164 a $1.12 million investment into an anaerobic digester in a dairy farm that traps and destroys methane emitted from the farm’s manure lagoon;165 and a $262,000 investment in a grassland conservation project, creating conservation easements that protect soil carbon from being released.166
161 Rachel Bass, Peter Murphy, and Hannah Dithrich. 2019. ‘Scaling Impact Investment in Forestry’. Global Impact Investing Network. https://thegiin.org/assets/GIIN_Scalingpercent20Impactpercent20Investmentpercent20inpercent20Forestry_webfile.pdf.
162 ‘Notable Achievements’. n.d. The Climate Trust. https://climatetrust.org/achievements/.
163 ‘Notable Achievements’. n.d. The Climate Trust. https://climatetrust.org/achievements/.
164 ‘St. John Forest Improved Forest Management’. n.d. The Climate Trust. https://climatetrust.org/case-studies/st-john-forest/.
165 ‘The Carlos Echeverria And Sons (Ce&S) Dairy Biogas’. n.d. The Climate Trust. https://climatetrust.org/case-studies/carlos-echeverria-and-sons-dairy/.
166 ‘Lightning Creek Ranch Avoided Grassland Conversion’. n.d. The Climate Trust. https://climatetrust.org/case-studies/eastern-oregon-grasslands-cooperative/.