COP 24: Transparency, ambition and carbon markets on the Paris rulebook agenda in Katowice

See EDF’s COP 24 materials and meet our Katowice team at edf.org/cop24.

COP 24 Opening Plenary in Katowice, Poland. Flickr/ UNclimatechange

As the world’s leading climate scientists made clear in a recent special report, we are in the race of our lives against climate change, and we need to move faster. The Paris Agreement’s rapid entry into force in 2016 broke records, but records are also being broken outside of the UN that emphasize the urgency of action: record wildfires, record temperatures, record storms, record levels of carbon in the atmosphere.

So the stakes are high in Katowice, Poland, as countries meet to finalize the operating manual for the landmark Paris Agreement on climate change. In 2016, countries set themselves a deadline of this year to complete their task. Once agreed, the Paris “rulebook” will guide them in their efforts to implement the Agreement, including how countries will measure, report and hold each other accountable to their Paris commitments.

Two interrelated issues will be particularly important for the rulebook discussions in Katowice.

First is how to operationalize the Paris Agreement’s transparency system; transparency is vital to strengthening ambition and to the success of the agreement itself.

Second is how that transparency system should link to a new framework for international carbon market cooperation designed to spur the deeper emissions cuts that climate science demands.

TRANSPARENCY

Importance of transparency to climate ambition

Ambitious climate action is often evaluated in terms of mitigation commitments. That is certainly crucial. But often overlooked is the value of ambition in transparency, the information sharing and review processes that make it possible to understand the ambition of a mitigation commitment, and whether it is in fact implemented.

Transparency is the backbone of the Paris Agreement. The Paris Agreement was built on the principle that robust information gathering and reporting will provide countries and subnational actors with the feedback they need to continually improve their mitigation efforts, and provide the essential information citizens need to ratchet up pressure on their governments to do more during each of the agreement’s successive five-year implementation cycles.

Getting the transparency rules right in Katowice

In Katowice, countries need to agree robust reporting and review requirements applicable to all countries that:

  • ensure clear, comprehensive, and reliable quantitative emissions information is provided by all major emitting countries no less than every two years.
  • require reporting to begin promptly. A prompt start to the enhanced transparency framework will help build confidence among countries that they can do more – as they see their peers also making progress toward their NDCs – and will provide the information necessary to correct course during implementation.

CARBON MARKETS

Transparency and ambition in action: mobilizing carbon markets at the COP

Cooperative action to drive down carbon pollution and drive up investment in low-carbon development is at the heart of the international carbon market provisions of Article 6 of the Paris Agreement, which provide a framework for countries to cooperatively reduce emissions wherever they are most cost-effective, and to transfer those reductions between them.

Effective carbon market approaches put a price and steadily declining limit on climate pollution, in order to drive up innovation and investment in cleaner technologies, and drive down pollution.

Recent EDF research demonstrates that well-designed international carbon markets can roughly double emissions reductions relative to current NDCs for the same overall cost of achieving current NDCs, compared to each country acting on its own. This closes about 40% of the gap towards an emissions pathway consistent with the Paris Agreement’s 2-degree Celsius (3.6-degree Fahrenheit) goal, over the years from 2020-2035.

But carbon markets must be designed right to achieve that potential, including through application of transparent measuring, reporting and review procedures that ensure avoidance of “double counting” of the same emission reduction

Preventing the sham of double counting of emissions reductions

One of the most crucial — but often overlooked — dimensions of transparency for carbon markets is the simple, transparent bookkeeping standards that would prevent the sham of “double counting” of emissions reductions.

Going into the rulebook negotiations in Katowice, there’s nothing that would prevent emissions reductions that are reported in the emissions inventory of the country where the reduction occurred as part of that country's progress in meeting overall Paris mitigation goals, from being counted once again by the acquiring country (or by another user) seeking to claim that reduction toward its own mitigation effort.

It’s basic common sense – and sound carbon accounting – not to count the same emissions reductions twice.

For instance, an airline using the reduction towards the International Civil Aviation Organization’s market-based measure to cap emissions from international aviation at 2020 levels, the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA), may run the risk of purchasing emissions reductions that have already been counted in the host country’s inventory, or even claimed towards the host country’s NDC target.

Using those already-counted reductions to offset an increase in emissions in the acquiring party would mean that overall emissions increase rather than decrease, jeopardizing the achievement of the goals of the Paris Agreement.

It’s basic common sense – and sound carbon accounting – not to count the same emissions reductions twice.

My son’s preschool teacher says children learn the early math skill of “one for one correspondence” at around the age of four, which allows them to count each item in a set once, and only once.

If a four year old can implement this basic principle of one-for-one counting, then countries can do it too.

Making sure reductions are not counted twice is fundamental to the ability of all existing carbon markets to reduce emissions.

In Katowice, countries need to lock in a rule stating that a country’s NDC emissions account must be increased by an amount equal to the tons of credits exported. This provision is essential to ensure the integrity and credibility of the climate regime, and keep the atmosphere whole.

Katowice is the moment to deliver guidance to countries to implement Paris Agreement. When rules are in place, investment flows. These rules are essential to unleash the cooperation and investment that can help drive the much deeper emissions cuts needed to turn the corner on climate change.

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