Asset manager Offset8 invests in Indonesia carbon project

Offset8

• Offset8 investing in Indonesia offsets
• Appetite for carbon offsetting on the rise  
• Project uses biochar from agricultural waste

Asset manager Offset8 Capital, which specialises in financing climate mitigation projects, has facilitated an undisclosed early-stage investment in a waste management scheme in Indonesia. 

The project, run by Singapore-based sustainable waste management company Sawa EcoSolutions and its Indonesian operating arm Legasi Alam Indonesia, is expected to generate around $50 million of carbon credits over the next 10 years, Offset8 said. 

Carbon offsetting, in which companies purchase credits in environmental projects to compensate for their own emissions, is increasingly being used as part of corporate sustainability strategies.

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Offset8 set up operations in free zone Abu Dhabi Global Market last year. It said it has already received expressions of interest from several companies across the Mena region keen to invest in the Sawa project, and expects high demand. 

The project is a carbon offset scheme involving a charcoal-like substance called biochar, which is made by burning organic agricultural and forestry waste. It has a range of uses, including water treatment, land reclamation and carbon sequestration. 

Sawa aims to establish 100 biochar production facilities across Southeast Asia, which it says will remove 1 million tonnes of carbon dioxide from the atmosphere annually. 

The Indonesia project will be developed in multiple regions across the country, starting with Majalengka Regency in West Java. Offset8 plans to set up a local presence to support the project, and has agreed a profit-sharing arrangement with Sawa and the communities in which it will operate. 

Offset8 is a member of the UAE Carbon Alliance and ASEAN Alliance on Carbon Markets. It aims to develop carbon credit schemes in Southeast Asia and Africa – especially in mangrove restoration, reforestation and biochar – for companies in the Middle East and Asia to invest in.

Abu Dhabi Global Market expects more green finance companies like Offset8 to set up in the free zone, after it published a sustainable finance regulatory framework in July.