Parties also discussed the definition of cooperative approaches
Photo: UNclimatechange / flickr Discussions on Article 6 during the initial 10 days of the 28th Conference of Parties (COP) to the United Nations Framework Convention for Climate Change (UNFCCC) saw some progress in refining rules and procedures for market approaches. Parties engaged in multiple meetings, deliberating on technical guidance for various matters. However, unresolved issues persist.
Article 6 of the Paris Agreement outlines ways in which countries can collaborate to fulfil their nationally determined contributions (NDC), widely recognised as the provision for carbon markets (and non-market approaches) within the Paris Agreement. Current discussions on Article 6 aim to finalise frameworks previously created and discussed at past COPs for Article 6.2, Article 6.4 and Article 6.8.
Conversations regarding Article 6.2 have focused on guidelines for operationalising carbon markets based on Article 6.2, involving the transfer of Internationally Transferred Mitigation Outcomes (ITMO), a term specific to the Paris Agreement for carbon credit transactions between countries and others.
These guidelines encompass the definition of a ‘cooperative approach’, the ‘authorisation’ process for cooperative approaches, ITMOs and entities, sequencing and timing of report submission and authorisation by Parties, among other procedural details.
An initial 32-page draft, issued by the co-facilitators for discussion, contained over 170 options, including several embedded ones for Parties to choose from. Discussions emphasised streamlining the text, focusing on the minimum essential elements necessary to operationalise the article, and addressing priorities such as the adoption of the Agreed Electronic Format, authorisation processes, and sequencing of processes where a spectrum of views exists.
Parties also discussed the definition of cooperative approaches. While some see a definition as restricting the scope of cooperative approaches, which can encompass many things, others view it as necessary to exclude approaches that do not fit the mechanism.
As the presidency is giving deadlines to conclude all technical discussions under the article, co-facilitators are working to have Parties agree on outstanding issues through informal sessions reserved for Parties only.
In a late-night discussion on the latest iteration of the decision text, several Parties, including the African Group, the European Union, Coalition for Rainforest Nations (CfRN), Alliance of Small Island States and Like-minded Group of Countries (LMDC), expressed disappointment, finding the text ‘unbalanced’, ‘difficult to work with’ and ‘unworkable’. The discussions would continue in an informal format.
Under Article 6.4 too, rules, modalities and procedures are under discussion. Negotiators have deliberated on the annual report of the supervisory body tasked with developing standards and procedures for mitigation activities that would generate emission reduction units called as 6.4ERs.
A challenging element within Article 6.4 negotiations is the discussion around removal activities, which include nature-based removals such as afforestation or technology-based removals such as direct air capture. Parties have varying standpoints on the recommendations made by the supervisory body on removal activities, such as accounting, the inclusion of nature-based removals, the sca le of removal activities and the permanence of carbon storage in removal activities.
Negotiations have also addressed procedural elements such as the authorization of Article 6.4-based emission reduction activities and the interoperability and connection between registries – the mechanisms registry, which would track A6.4ERs, the international registry, and national registries. Similar to the Article 6.2 discussions, Parties differ in their preferences; for instance, regarding the timing of authorisation, some Parties want authorisation before the issuance of emission reduction units for the activity, some support authorisation when the activity is registered, whereas others prefer authorisation to be given at any time a party decides.
While the broader acceptance of the supervisory body’s report and recommendations signals progress, discussions have indicated that several areas need work. Co-chairs have insisted Parties to communicate, compromise and resolve outstanding issues as soon as they can.
Going forward, there is a proposal for the Supervisory Body to establish a Work Programme to develop methodologies and removal activities, work on an appeal and grievance mechanism, and issue guidelines on matters such as baselines, additionality and carbon leakage.
Article 6.8, the provision on non-market approaches within the Paris Agreement, has been an outlier in negotiations as the development of a framework on non-market approaches lags behind the progress made on market mechanisms under Articles 6.2 and 6.4.
At Glasgow in 2021, a web-based platform for the identification of opportunities for Parties to identify, develop and implement non-market approaches was announced. However, the web-based platform has still not been operational. While some Parties want to acknowledge the progress made in launching the platform in the draft text, others seek a full launch as early as possible.
An earlier version of the Article 6.8 based draft text under discussion had suggested ‘carbon pricing’ as a non-market mechanism. This was actively opposed by several groups of countries, including the LMDCs, CfRN, the Independent Association of Latin America and the Caribbean (AILAC), the Arab Group and Least Developed Countries. The provision’s main backing came from the European Union, which argued that carbon pricing can include other instruments such as carbon taxes and levies, which are not market-based.
Bolivia has been at the forefront of highlighting the importance of non-market approaches. In a recent iteration of the negotiations meeting on Article 6.4, Bolivia put forward a proposal to impose a moratorium on Article 6.4 operationalisation until similar progress is achieved under Article 6.8. In fact, in the December 8th meeting on Article 6.2, LMDCs also raised concerns about the unbalanced consideration of cooperative approaches and the neglect of non-market-based approaches.
We are a voice to you; you have been a support to us. Together we build journalism that is independent, credible and fearless. You can further help us by making a donation. This will mean a lot for our ability to bring you news, perspectives and analysis from the ground so that we can make change together.
.png)
Comments are moderated and will be published only after the site moderator’s approval. Please use a genuine email ID and provide your name. Selected comments may also be used in the ‘Letters’ section of the Down To Earth print edition.