China has made tremendous strides in improving food security for its population, but in certain areas, this has come at the expense of the environment. Faced with the absence of a cost-effective carbon accounting methodology, FAO together with the Chinese Academy of Agriculture Science, the World Agroforestry Center and the Northwest Institute of Plateau Biology, developed a new "Verified Carbon Standard (VCS) methodology" to give Chinese farmers the tools to manage their animals and grasslands more sustainably in the years to come. The VCS methodology quantifies emission reductions from a range of activities including, improving the rotation of grazing animals between summer and winter pastures, limiting the timing and number of grazing animals on degraded pastures, and restoration of severely degraded grasslands. The methodology is currently applied to the Three Rivers Sustainable Grazing Project, to restore degraded grasslands in Qinghai province, in northern China. The average annual mitigation potential in the first 10 years of implementation are an estimated 63 000 tonnes of CO2 eqv. per year.