Buffer Pool Policy

Purpose and Scope

This Buffer Pool Policy establishes the program-level rules governing the design, operation, and governance of the Open Carbon Protocol (OCP) Buffer Pool. The Buffer Pool is intended to ensure the environmental integrity and permanence of issued OCP emissions units by providing a standardized mechanism to fully compensate for material reversals of credited emissions reductions or removals.

This Policy applies to all OCP-registered activities for which reversal risk is present. It does not compensate for overcrediting as defined in the OCP Handbook.

Definitions

• Buffer Pool: A single, program-wide pooled reserve publicly identifiable within the OCP Registry.

• Material Reversal: A reversal event resulting in a cumulative loss of credited emissions reductions or removals exceeding the Program’s materiality threshold, defined as the greater of: 5% of the total net emissions units previously issued to the activity.

• Loss Event: Any physical, chemical, or biological event that results in a reduction of credited carbon stocks or storage.

• Avoidable Reversal: A material reversal attributable to negligence, non-compliance, or failure to implement required monitoring or mitigation measures.

• Unavoidable Reversal: A material reversal resulting from exogenous factors beyond the reasonable control of the activity proponent.

• Replacement: When a buffer pool credit is transferred to the owner of a credit of a project that has experienced a material reversal

• Cancellation: When a buffer pool credit is cancelled to replace the claim for a retired credit from a project that has experienced a material reversal

Contribution Requirements

Buffer Pool Contributions are set at the Methodology Level and approved as part of the Expert Panel approval process.

Monitoring, Detection, and Notification

Activity proponents shall implement monitoring systems capable of detecting loss events and potential reversals in accordance with Program requirements.

Activity proponents must notify the Program of any suspected or confirmed material reversal within 5 calendar days of becoming aware of the event. Notification shall include preliminary evidence sufficient to enable the Program to assess the magnitude and materiality of the reversal. Confirmed events must have complete disclosure of the data within 45 calendar days of the event.

The OCP will rule on the materiality of the reversal and the corresponding Buffer Pool activities within 90 days of receiving the notification. The OCP Advisory Board will review any Buffer Pool disbursements or cancellations.

Compensation Mechanism & Replenishment Obligations

All verified material reversals shall be fully compensated through the cancellation or disbursement of Buffer Pool units equal to the quantified net emissions loss. If the Buffer Pool cannot cover the net emissions loss, then either non-OCP credits of similar methodologies or a monetary payout will be granted to the owner of the credits. The OCP reserves the right to use insurance mechanisms to improve the efficiency and efficacy of the OCP Buffer Pool

In the case of an avoidable reversal, the activity proponent shall replenish the Buffer Pool with emissions units equal to the amount of the reversal.

Replenishment may be satisfied through:

• future issuances from the same activity; or

• alternative arrangements approved by the Program.

Failure to replenish shall result in enforcement actions, including suspension of issuance, cancellation of issued emissions units owned by the project developer, or removal of activities.

Transparency and Reporting

The Program shall publicly disclose Buffer Pool balance and composition in a live wallet on the OCP registry.