What is a carbon credit?
In a voluntary carbon market, a carbon credit generally represents one tonne of carbon-dioxide equivalent (tCO₂e) avoided, reduced or removed under an accepted carbon-crediting framework. Credits are not created merely because a project is environmentally beneficial. The project must follow an approved standard and methodology and complete the required validation, monitoring, verification and registry processes before credits can be issued.
Why organic waste matters for methane
Organic material can generate methane when it decomposes under anaerobic conditions, particularly in disposal systems where methane is not captured or destroyed. Methane has a strong climate effect, which is why some carbon methodologies focus on diverting organic waste away from methane-generating baseline pathways and into controlled treatment systems.
However, the climate calculation depends on what would have happened without the project. If the organic material was already being treated aerobically, reused or otherwise managed with low methane emissions, the creditable reduction may be smaller or may not meet the methodology requirements.
Can insect-based composting be eligible?
Potentially, under the right circumstances. In February 2025, Verra clarified that two active Clean Development Mechanism methodologies used within the Verified Carbon Standard programme—ACM0022 and AMS-III.F—can apply to controlled biological treatment involving insects. The clarification recognises insect composting as a form of controlled aerobic biological treatment.
This is important for the BSF sector, but it should not be interpreted as automatic approval of every BSF facility. A project still has to satisfy the methodology's scope, baseline, additionality, monitoring, project-emission and other programme requirements.
What would a BSF project need to examine?
| Project question | Why it matters |
|---|---|
| Where would the organic waste go without the BSF project? | The baseline disposal or treatment pathway drives the methane-avoidance calculation. |
| Is the feedstock eligible and traceable? | The project needs defensible evidence about the type, source, quantity and historical treatment of organic material. |
| What emissions occur inside the project? | Electricity, fuel, transport, treatment emissions and other relevant sources can reduce net credited benefits. |
| Is the project additional? | Carbon programmes require evidence that the project meets their additionality rules rather than simply rewarding business-as-usual activity. |
| Can the required data be monitored consistently? | Crediting requires auditable measurement, records and controls over the monitoring period. |
| Who will validate and verify the project? | Independent validation/verification bodies are part of the integrity process before registration and issuance. |
Where does Bursa Carbon Exchange fit?
Bursa Carbon Exchange (BCX) is Malaysia's voluntary carbon-market trading platform. It provides mechanisms including auctions, spot trading and off-market transactions for eligible environmental products and carbon credits.
BCX should be understood as part of the market infrastructure. It does not turn a waste-management activity into a carbon-credit project by itself. A project would first need credits issued under an accepted standard and registry framework that meets the relevant market requirements.
Can Terbit estimate carbon-credit revenue today?
Not responsibly. Revenue depends on the number of verified credits actually issued, project-development and verification costs, registry and methodology requirements, market price, transaction structure, credit quality, buyer demand and the timing of issuance.
Even an environmentally strong project may generate fewer credits than initially expected, take substantial time to reach issuance, or prove uneconomic after monitoring, validation, verification and transaction costs. Carbon-credit revenue should therefore be treated as a potential project-economics layer, not as guaranteed income.
What Terbit can say today
Terbit can responsibly explain that circular agriculture and controlled organic-resource conversion may reduce waste and, in some project configurations, may avoid greenhouse-gas emissions relative to a defined baseline. Terbit can also evaluate whether future projects could qualify under recognised carbon standards.
Terbit should not claim a fixed number of credits per tonne of organic waste, guaranteed methane avoidance, automatic BCX eligibility, carbon neutrality, or a specific carbon-credit income unless a defined project has completed the required methodology and verification work.
A practical carbon-readiness pathway
- Define the physical project. Identify location, feedstocks, volumes, treatment process, energy use and outputs.
- Establish the baseline. Document what happens to the same organic material without the project.
- Screen methodologies. Check current scope, eligibility, additionality and monitoring requirements.
- Build the data system. Create traceable measurement for incoming waste, process operation, energy, transport and relevant emissions.
- Assess economics. Include project-development, validation, verification, registry and transaction costs—not only headline credit prices.
- Validate and register if viable. Follow the selected carbon programme and independent assurance process.
- Monitor and verify. Credits can only be issued for reductions that meet the applicable programme's requirements.
What about fertilizer and sustainable-protein benefits?
BSF systems can create useful outputs such as frass-derived agricultural inputs and larval biomass. These outputs may strengthen the overall circular-business case, but they should not automatically be counted as carbon credits. Whether substitution effects—such as replacing another fertilizer or protein source—can be credited depends on the specific approved methodology and accounting boundaries.
This distinction is especially important because proposed carbon methodologies can change. Project developers should use the active methodology and programme rules that apply at the time of project development rather than relying on older proposals or marketing claims.
Frequently asked questions
Does using Black Soldier Fly technology automatically generate carbon credits?
No. Technology choice alone does not create credits. The project must satisfy an applicable carbon-crediting methodology and complete the required validation, monitoring, verification and issuance process.
Can credits be sold on Bursa Carbon Exchange?
BCX provides a marketplace for eligible credits and environmental products. A project first needs appropriately issued credits that meet the applicable trading and onboarding requirements.
Can we calculate credits from tonnes of food waste alone?
No reliable universal conversion should be used. The result depends on the baseline disposal pathway, waste characteristics, project emissions, methodology equations, additionality and monitoring data.
Should a farmer invest because carbon-credit income is expected?
Carbon revenue should not be treated as guaranteed. The underlying agricultural or waste-management project should be economically and operationally assessed independently of speculative credit income.
Terbit's current position
Terbit Malaysia 2.0 treats carbon markets as a future project-development opportunity rather than a current product promise. The near-term focus remains circular agriculture, Organic Fertilizer product development, market learning and evidence building.
If a future Terbit organic-resource or BSF project has sufficient scale, traceability and baseline evidence, Terbit can then commission a formal carbon-methodology feasibility assessment before making any carbon-credit claim.
References and further reading
- Verra (2025): clarification that applicable composting methodologies can cover insect composting.
- Verra: ACM0022 Alternative waste treatment processes.
- Verra: AMS-III.F Avoidance of methane emissions through composting.
- Bursa Carbon Exchange: Voluntary Carbon Market Handbook.
Circular agriculture first
Build the physical value before assuming carbon revenue.
Terbit's priority is to create useful agricultural and resource-recovery outcomes, then assess carbon-market eligibility only where the project evidence supports it.
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