Section (c.1) Natural Capital Account

In the Natural Capital Account the status of the above-defined Land Characteristics are being displayed and updated in at least annually.

Displayed Measurements

Measurements are displayed in the NCA according to the following rules for convenience:

• If the number to be displayed is equal to or greater than 100, no decimals will be displayed;

• If the number to be displayed is equal to or greater than 10 and less than 100, one decimal place will be displayed;

• If the number to be displayed is equal to or greater than 1 and less than 10, two decimal places will be displayed;

• If the number to be displayed is less than 1, three decimal places will be displayed; and

• when the number of decimal places is truncated according to these rules, rounding down is applied

Result uncertainties

Data calculated and displayed in the NCA are best estimates which are calculated under a transparent and published methodology and validated by external validation processes. As with all estimators, these values do exhibit uncertainties due to a number of reasons, such as measurement errors, model uncertainties, incomplete scientific understanding and simplifying assumptions. TLG and its partners are continuously seeking to improve both the quality of data used as inputs to models as well as the models themselves. In addition, advancements in earth observation and reference data availability are expected to further improve TLG’s measurement accuracy levels.

The improvements in models may impact the assessed Land Characteristics in three ways:

1. a) Some improvements may allow to measure new biophysical factors that have not been measured to date.

2. b) Some improvements may improve the precision of measurements and predictions shown in the NCA.

3. c) Some improvements may allow to calculate additional Land Characteristics over a time period.

In all cases existing NEAs derived from the NCA would not be affected by changes in models and data.

The availability of new biophysical factors to assess Natural Capital will not impact existing NEAs and any related Nature Equity Assets Purchase Agreements (”NEAPAs”) in place. Being able to calculate additional uplift for a NEA will not adversely impact a NEAPA, as every NEAPA will specify a maximum contracted volume of NEAs and settlement is conducted on a First-in/First-Out basis.

Changes to measurement methods from time to time, will not negatively impact the value of any already issued NEAs.

Extraordinary circumstances may lead to difficulties measuring one or more biophysical factors using our measurement services, including but not limited to environmental impacts (e.g., drought or wildfire) or missing or insufficient measurements (e.g. satellite malfunction, prolonged cloud cover). In such a case TLG may perform a measurement using a less precise and robust methodology, show an interpolated value or display no value at all. If TLG is aware that the displayed value comes from a less precise methodology, TLG will not issue any new NCUs. In the absence of a methodology to measure biophysical factors during the term of a NEAPA, it would not be possible to define or assign NEAs for the respective NEAPA.