First fair trade climate neutral investor in the Netherlands

First fair trade climate neutral investor in the Netherlands

News item
03 Jun 2018

Oikocredit, together with FairClimateFund, invests in biogas for farmers in one of the most underdeveloped areas in India, the Chik Ballapur district in the state of Karnataka. With this investment, according to Fairtrade principles, they ensure that farmers and daily wage workers have access to clean cooking through a biogas installation. This not only leads to CO₂ reduction and income from the sale of CO₂ credits, but also ensures better living conditions. This makes Oikocredit the first investor in the Netherlands with a completely Fairtrade CO₂-neutral business operation.

The Chik Ballapur district in the state of Karnataka is one of the most underdeveloped areas in India, where mainly daily wage workers and small farmers live in poor conditions. The polluted streets cause health and climate problems, the conditions inside can hardly be called better because the traditional ovens, made of stone and clay and burning kerosene and wood, produce a lot of harmful smoke.

The investment by Oikocredit and FairClimateFund will allow approximately 500 biogas installations to be installed that replace kerosene and wood for cooking and hot water with biogas. A biogas installation of 2 cubic meters provides enough gas for a family of four to five people to cook on a daily basis. Each household helps with the construction of the biogas plant and dumps cow manure, organic and biomass waste into the plant. Project development, monitoring and maintenance are carried out locally.

Local benefits
The local farmers transform organic waste into a sustainable and healthier alternative to their wood or kerosene ovens. This saves them a lot of time and money. After all, they no longer have to look for wood, the use of organic waste is much cheaper than kerosene and health problems caused by kerosene use will therefore occur less often. Finally, the residual product of biogas is a very fertile fertilizer that can be used on the land.

Fair prices for Fairtrade Carbon Credits
The CO₂ reduction achieved by cooking on the biogas installations is certified in Fairtrade Carbon Credits that are sold for a fair price to companies and organizations for the purpose of climate compensation. In the CO₂ market, local households generally do not receive compensation for these carbon credits. To overcome this, Fairtrade International and Gold Standard – together with FairClimateFund – have developed the Fairtrade Climate Standard. The biogas project credits are Gold Standard certified and also meet the Fairtrade Climate Standard, which means that local households own the credits. Companies are therefore assured that CO₂ emissions are actually compensated and that a fair price is paid to the families who have achieved the CO₂ reduction in India.

Thos Gieskes, managing director of Oikocredit International: “Oikocredit believes it is important to protect the environment and pays attention to this in all its investments. At the same time, realizing social impact is at the heart of everything we do: we want to improve the lives of people with low incomes. That is why Gold standard Carbon Credits that are also Fairtrade certified fit perfectly with our mission.”