Chestnut Carbon - Carbon credits Insurance

Terrestrial

Insure carbon delivery to finance afforestation

Private

• $210M non-recourse project financing enabled
• 60,000 acres acquired and restored
• 35M+ native trees planted
• First voluntary carbon market project finance — replicable model

Carbon-credit delivery insurance backing a 25-year Microsoft offtake, mandated within a US$210m J.P. Morgan project-finance facility, enabling acquisition and restoration of around 60,000 acres and 35m-plus native trees.

CFC, Marsh McLennan, JP Morgan, Chestnut Carbon

Case study referred by NATURANCE. For more information, please contact: info@naturance.eu.

Marsh placed a carbon credit delivery insurance policy, underwritten by CFC, for Chestnut Carbon, a nature-based carbon removal developer that plants native hardwood/softwood trees on unused farmland across the southeastern United States. The policy protects against the risk of non-delivery of carbon removal credits under a 25-year offtake agreement with Microsoft for > 7 million tonnes. The insurance was mandated by the lending panel as a condition of a landmark US$ 210 million non-recourse project finance credit facility led by J.P. Morgan. By de-risking the carbon credit revenue stream, the insurance directly enabled financing for the acquisition/restoration of roughly 60,000 acres and the planting of > 35 million native trees. This represents the first such project financing in the voluntary carbon market and establishes a replicable model for channelling institutional capital into large-scale afforestation.

• Marsh secures carbon credit insurance on landmark bank financing deal for a US carbon removal project
• Pioneering deal for carbon removal: J.P. Morgan leads project financing for Chestnut Carbon