VCM retirements hit highest level since 2022 while issuances slide 27M credits YoY

## OzelCarbonOS VCM Intelligence Brief — 10 October 2026 **Demand surges as supply tightens.** The most significant signal this period comes from Carbon Pulse's monthly VCM analysis: carbon credit retirements through the first three quarters of 2026 have reached their highest level since 2022, while issuances have fallen by 27 million credits year-on-year ([source](https://carbon-pulse.com/559128/)). This widening supply-demand gap has bullish implications for pricing across major credit types — particularly nature-based avoidance credits (REDD+, avoided conversion) that have been under issuance pressure due to tighter Verra methodologies. Buyers appear to be accelerating retirement activity, possibly front-running anticipated price increases and tightening CCP-label supply from IC-VCM assessments. **Removals face a scaling wall.** A new report highlights that carbon dioxide removal (CDR) capacity must grow roughly 51% annually to meet 2030 supply projections based on corporate forward-purchase targets ([source](https://carbon-pulse.com/559360/)). This underscores persistent delivery risk in the removals segment and reinforces the premium that engineered-removal credits (DACCS, BiCRS, biochar) command over avoidance categories. Meanwhile, the IMO has adopted guidance on select marine CO2 removal techniques, which could shape quality benchmarks and market access for ocean-based CDR credits ([source](https://carbon-pulse.com/559288/)). On the methodology front, France's Label Bas-Carbone published a first-of-its-kind biomass burial carbon removal module under a broader BiCRS framework, signaling European momentum in durable-removal standard-setting ([source](https://carbon-pulse.com/559281/)). **Article 6 and PACM developments boost cookstove pathway.** The UN Supervisory Body governing the Paris Agreement Crediting Mechanism (PACM) formally adopted two methodologies for household clean cooking activities, including a notable exemption from the mechanism-wide downward adjustment requirement for certain projects ([source](https://carbon-pulse.com/559388/)). This is a meaningful policy tailwind for cookstove developers that have struggled with additionality scrutiny and baseline-setting under legacy VCS and Gold Standard frameworks. Projects that can channel credits through both Article 6.4 and the voluntary market may benefit from dual eligibility, though buyer appetite will depend on whether CCP or corresponding-adjustment labels attach. **Global South pipeline and capital allocation.** Mozambique is actively building a national portfolio of investable climate projects to court private capital beyond traditional development finance ([source](https://carbon-pulse.com/559306/)). However, a separate analysis warns that mega-funds are absorbing the lion's share of climate fundraising, creating a mismatch that leaves smaller, early-stage deals — often in frontier markets — underserved ([source](https://carbon-pulse.com/559299/)). This dynamic is particularly relevant for REDD+ and ARR project pipelines in sub-Saharan Africa and Southeast Asia, where smaller-ticket project finance is critical. **Compliance market context.** In the compliance space, CFTC Commitments of Traders data show managed money expanding net length in California Carbon Allowances (CCAs) while building a net short position in RGGI allowances ([source](https://carbon-pulse.com/559272/)). EU member states have progressed free allowance issuance for 2026 industrial installations to nearly 85% ([source](https://carbon-pulse.com/559255/)), and EUA prices posted a healthy weekly gain despite narrow intraday ranges, with trading driven by technical levels rather than energy-market volatility ([source](https://carbon-pulse.com/559049/)).