UN carbon market takes major step forward with new standards adoption

In a significant development for the global carbon market, the Article 6.4 Supervisory Board, responsible for overseeing the creation of the UN carbon market under the Paris Agreement, has finalised two pivotal standards. This key advancement comes as global stakeholders prepare for COP29, set to take place in November.

The decision was made during a critical session held in Baku, where the Supervisory Board worked extensively to establish the operational language for these standards, marking an unexpected turn in the usual procedural expectation. Typically, such draft standards would first be subject to approval by the Parties to the Paris Agreement (CMA). However, delays in this adoption process over recent years have possibly prompted the board to expedite its actions.

Maria AlJishi, Chair of the Article 6.4 Supervisory Body, highlighted the significance of this move: "These new standards are a key element in our effort to deliver a crediting mechanism that is fit for the future. As the only crediting mechanism directly responsible to Parties and mandated by the Paris Agreement, we are committed to ensuring it balances the needs of achieving the Paris goals, supporting market players, and addressing host country interests."

The newly adopted standards aim to support the creation of a robust and adaptable carbon market, aligning with ongoing international dialogues, such as those at Climate Week New York, where the EU and US demonstrated closer cooperation on Article 6 matters.

The origin of the UN carbon market initiative dates back to 2015, aiming to facilitate the trading of emission credits between nations, specifically enabling financial transactions between developed countries with high emissions and emerging economies. This initiative is anticipated to catalyse significant financial flows towards cleaner technologies and sustainable practices.

Despite the forward momentum, there are lingering uncertainties regarding the processes underlying this rapid advancement. Olga Gassan-zade, a former head and current member of the Supervisory Board, remarked on the spontaneity of developing essential elements of the 6.4 mechanism, describing the documentation process as "surreal" at times, due to hurried drafting under time constraints.

The standards, for now, stand operative, though the CMA retains the authority to re-evaluate them during COP29's assembly, reinforcing the necessity for scrutiny and potential revision.

Implications for Carbon Removal Sector

The implementation of these UN carbon markets is poised to significantly bolster carbon removal efforts globally. Over recent years, the industry has seen considerable growth, though the lack of widely recognised standards has hindered the demand side.

A concerted advocacy from industry stakeholders, such as the Carbon Business Council, has been noted. The council, comprising over 100 signatories, advocates for the adoption of the Intergovernmental Panel on Climate Change (IPCC) definitions for carbon removal and calls for a comprehensive approach to emerging technologies capable of participating in a structured market.

A standardised UN-issued protocol could provide the vital framework needed for various carbon removal methodologies, including atmospheric, geological, and ocean-based techniques, highlighting its potential as a unifying force in global climate action.

As the carbon market continues to evolve, these foundational standards signal a potential new era of international cooperation and environmental strategy, aiming to tackle the pressing challenges of climate change in a collaborative and effective manner.

Source: Noah Wire Services