Point Carbon and Perspectives have decades of experience from economic analysis, modelling of abatement potentials, baseline setting, and assessing the detailed aspects of offset projects. Hence we are uniquely positioned to assist project developers and carbon credit off-takers in their due diligence of potential offset generation projects and carbon-related investments.

We understand the challenges related to different technical, financial, methodological, operational and legal aspects of carbon projects, and can assist in the detailed due diligence of this on a bespoke basis, adapted to the specific client needs. Our due diligence services range from simple desktop based exercises to comprehensive on-site reviews of projects and investment objects.

We will also check if the product and service projections are reasonable with regard to load factors, environmental conditions, PPAs and off-take contracts.

Project planning: Financing

We offer an evaluation of project budgets, checking whether the investment calculations are made applying reasonable assumptions with regard to:

• Bank interest rates,
• Duration and terms of loans
• Reliability of equity sources
• Availability of subsidies and grants
• Risks related to guarantees/penalties
• Tariffs
• Quotes on equipment
• Completeness of technical configuration
• Labour and maintenance costs 

Project planning: Reduction potential and operations

We will assess the likeliness of the project to generate the projected amount of carbon credits, dependent on where the project is in the project cycle, its applied methodology and its host country. Furthermore we can offer assessments of technology to be deployed with regard to:

• Proven robustness,
• Technological maturity
• Configuration completeness,
• Management, operation and maintenance competencies,
• Completeness of monitoring and reporting activities and how these comply with applicable requirements and are tied into operational procedures,
• Reliability and accuracy of monitoring devices, and
• Delivery risks related to geological/geographical/ typographical/seasonal conditions.

Project planning: Legal

We will evaluate whether there are any legal issues pending on company(ies) and management involved in the project, and whether title to property, equipment, facilities and carbon credits are legally secured. In case export credit is a part of the guarantees, this will be evaluated, as well as whether all local concessions are obtained. The content of the Emission Reduction Purchase Agreement and any options therein will be evaluated for reasonableness of price and volumes. We will also evaluate whether the project participants are correctly identified and authorized with the UNFCCC as applicable.

Project Implementation: Construction

 We will assess delivery plans and schedules for their adequateness, as well as the construction management capacity. We will ensure that critical paths are identified and critical equipment, both for construction and delivery. Seasonal and shift plan adjustments for project and manpower scheduling should be identified, as well as associated definitions of responsibility and authority.

Project Implementation: Clients & subcontractors

 We will independently assess any risks and dependability the project will have with regard to price lock-in, client or subcontractor substitution, and other key relationships.
Client and subcontractor contracts will be assessed in light of defined competencies, long-term conditions, and re-negotiation terms.

Project Implementation: Monitoring and reporting

We will assess that accurate, complete and consistent document control and record keeping is established for all aspects related to carbon offset performance, and that key procedures and instructions are documented. Furthermore we will determine whether:
• Sufficient training and competence maintenance procedures have been established in order to ensure that variability and anomalies in the monitoring is captured and explained,
• The authority to correct/adjust records accordingly is clearly defined.
• Procedures for corrective and preventive actions as well as emergency preparedness/contingency plans are established where applicable, and
• IT/communication systems are aligned and regularly backed up.

Project Operation and Maintenance

We will assess whether there is sufficient project competence to understand the linkage between product output and carbon offset generation. This may include whether:
• Competence for maintenance activities is available,
• These are supported by documented procedures when and where necessary,
• Maintenance schedules and spare parts are sufficiently available, and
• That planned maintenance schedules are based on experience and/or manufacturer recommendations.
The assessment will also comprise that necessary activities are implemented for control and calibration of monitoring devices and that performance records create a complete, consistent and accurate audit trail from all reported carbon data.

Risk assessments and desk reviews
Over the past years, Point Carbon has done hundreds of risk assessments of CDM and JI projects on various stages and in various countries. These risk assessments have taken form from simple desk reviews to recalculation of baselines to on-site visits. Customers have been utilities, financials and governments, and projects have ranged from specific assessments of a particular project to screening, rating and risk assessment of groups of up to 30-40 concrete projects. 

On-site due diligence of an African forest plantation project
Point Carbon and Perspectives GmbH conducted an on-site due diligence of a potential CDM project in Africa. The report covered all key project risks, including project implementation risks, project approval risks and the social and environmental sustainability of the project. Project was commissioned by the Government of Norway, and can be downloaded here.

Risk assessment and price recommendations for two JI projects
The report included quantitative and qualitative risk assessment as well as a walkthrough of the commercial side of a potential investment in two JI projects located in Russia. Specific recommendations were given to the client on a fair price for the project and on issues to follow up and clarify during the contract negotiations. Due to the uncertainties with regards to if and when the first Russian host country approval will be given, special focus was on the Russian host country risk by:
• Analyzing the general status of JI in Russia based on Point Carbon’s Russian host country rating and the latest JI policy development in the country.
• Assessment of the likely timeframe and likelihood of host country approval for the two specific projects based on factors such as:
     - How far they have reached in the Russian approval process
     - Host country approval outlook for the project type 
     - Institutional capacity of the responsible ministry 
     - Track 1 vs. track 2 outlook 
     - Ownership structure of the project.
Project was commissioned by a European government.