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Amazon Commits to Reducing Methane Emissions through Long-Term Carbon Credit Purchase Agreement

Amazon has announced a significant step towards reducing its carbon footprint by signing a long-term agreement with The Good Rice Alliance (TGRA), a sustainability-focused group working with smallholder rice farmers across India to mitigate methane emissions.

Under the deal, Amazon will purchase more than 685,000 tonnes of CO2-equivalent carbon credits during the initial crediting phase. This effort aims to curb methane released by flooded paddy fields, a practice responsible for 8-10 per cent of global methane emissions. India, the world's third-largest methane emitter, has the largest area of rice cultivation globally, supporting over 100 million livelihoods.

The Good Rice Alliance works with more than 13,000 smallholder farmers across multiple Indian states, covering over 35,000 hectares of farmland. Through its program, TGRA trains farmers in water-management techniques such as Alternate Wetting and Drying (AWD) and Direct Seeded Rice (DSR), which can reduce irrigation water use by up to 30 per cent.

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Methane carries a global warming potential more than 27 times that of carbon dioxide, making near-term cuts significant for slowing climate change this decade. Amazon's Director of Sustainability Solutions and Services, Michelle Jolly, highlighted the importance of addressing methane emissions, stating that "methane is a super pollutant that demands our attention now."

The carbon credits under the program are verified by Verra's Verified Carbon Standard using the VM0051 methodology for improved rice management. Field data is cross-validated against satellite-based soil moisture and water records.

Program ComparisonAmazon's AgreementTGRA's Program
Carbon Credits (tonnes)685,000Not specified
Farmers supportedNot specified13,000
Hectares of farmlandNot specified35,000
Water use reduction30%Not specified

The Good Rice Alliance is a partnership that includes Bayer South Asia and collaborates with the International Rice Research Institute (IRRI) on direct field-based methane measurement.

Read also: RBI Policy Preview: A Cautionary Wait Ahead

Investor Takeaway

Investors should consider the potential long-term benefits of companies investing in sustainability initiatives.

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