Climate 411

COP 25: Carbon markets in the spotlight

Staff and volunteers welcomed at COP 25 in Madrid.
UNclimatechange via Flickr

International cooperation on carbon markets, covered in Article 6 of the Paris Agreement, is at the top of the agenda for the COP 25 climate talks in Madrid this week. Since leaving the Article 6 section of the Paris Agreement without agreement at COP 24, negotiators have continued to work over the past year to garner support for a deal, before countries shift focus to preparing their critical next round of NDC pledges, due next year.

They will do this against a backdrop of political disruption, but continued determination to finalize the Paris Agreement’s operating instructions, known in the UN as the “rulebook”.

Civil unrest in Chile led that country’s president to take the unprecedented step of canceling the climate conference only five weeks before its scheduled start. Spain quickly stepped in the next day to offer to organize the negotiations, known as COP 25, in Madrid. The United States earlier this month officially began the process to withdraw from the Paris Agreement. All this is happening while the increasing impacts of climate change are being felt around the world; fires have ravaged Australia and California, while historic flooding is drowning Venice and dangerous pollution is choking Indian cities. And a new World Meteorological Organization report confirms that the atmospheric concentration of three key greenhouse gases – methane, CO2, and nitrous oxide – continues to rise.

Although the ultimate success of the Paris Agreement will be judged many years from now, how the rules on international carbon markets are decided in Madrid could make or break the ambition of the Paris Agreement.

That’s because international carbon market cooperation underpinned by strong accounting and transparency rules can help drive emissions down significantly: research shows that well-designed carbon markets could nearly double the ambition of current national climate pledges, at no extra cost.

However, weak rules for carbon trading between countries could fundamentally undermine the Paris Agreement. By allowing countries and the private sector to “count” carbon credits that don’t represent real emissions reductions, a bad set of rules on Article 6 could negate the climate ambition of current climate pledges.

What is a good Article 6 agreement?

Read More »

Also posted in Carbon Markets, COP 25, United Nations / Leave a comment

What You Need to Know About Article 6 of the Paris Agreement

This post was coauthored by Kelley Kizzier from EDF, Kelly Levin from World Resources Institute, and Mandy Rambharos, Article 6 negotiator, South Africa. It originally appeared on WRI’s blog

As delegates arrive in Madrid for the UN Climate Change Conference (COP25) this week, one issue is top-of-mind: finalizing the rules on how countries can reduce their emissions using international carbon markets, covered under Article 6 of the Paris Agreement on climate change.

Article 6 is one of the least accessible and complex concepts of the global accord. This complexity was a major reason that Article 6 was not agreed to until the last morning of the Paris negotiations in 2015 and was left unresolved at the Katowice climate talks last year. Getting these rules right is critical for fighting climate change: depending on how they are structured, Article 6 could help the world avoid dangerous levels of global warming or let countries off the hook from making meaningful emissions cuts. The integrity of the Paris Agreement and countries’ climate commitments hang in the balance.

Here’s what you should know:

How do international carbon markets work?
International carbon markets work like this: Countries that struggle to meet their emissions-reduction targets under their national climate plans (known as “nationally determined contributions,” or NDCs), or want to pursue less expensive emissions cuts, can purchase emissions reductions from other nations that have already cut their emissions more than the amount they had pledged, such as by transitioning to renewable energy. If the rules are structured appropriately, the result can be a win-win for everyone involved — both countries meet their climate commitments, the overachiever is financially rewarded for going above and beyond, finance is provided to the country generating the emissions reductions, and the world gets a step closer to avoiding catastrophic climate change.

What does the Paris Agreement say about carbon markets?
Article 6 has three operative paragraphs, two of which relate to carbon markets:

  • Article 6.2 provides an accounting framework for international cooperation, such as linking the emissions-trading schemes of two or more countries (for example, linking the European Union cap-and-trade program with emissions-reduction transfers from Switzerland). It also allows for the international transfer of carbon credits between countries.
  • Article 6.4 establishes a central UN mechanism to trade credits from emissions reductions generated through specific projects. For example, country A could pay for country B to build a wind farm instead of a coal plant. Emissions are reduced, country B benefits from the clean energy and country A gets credit for the reductions.
  • Article 6.8 establishes a work program for non-market approaches, such as applying taxes to discourage emissions. For this explainer, we will focus on the carbon markets elements of Article 6.

While Article 6 established these concepts in broad strokes and countries achieved some progress on defining the rules over the years, their final shape remains yet to be agreed. Finalizing these rules is a key agenda item for COP25.

Read More »

Also posted in Carbon Markets, COP 25, United Nations / 1 Response

As 2020 approaches, the climate action spotlight is on forests

Amazon Canopy. Warwick Lister-Kaye / istockphoto.com.

With 2020 fast approaching, countries, companies, and other stakeholders are taking stock of their climate commitments. As they consider ways to meet and enhance climate goals, interest in net zero emissions commitments and carbon removal technologies has grown. But what these discussions reveal is that forests are crucial. Capable of significantly reducing net emissions at a low marginal cost, and in the short-term, forests are an important piece of the climate change mitigation puzzle.

This year, tropical forests have dominated the spotlight. The forest fires raging throughout Brazil, Bolivia, and Indonesia are part of a disturbing trend: despite commitments from governments and companies, deforestation is still on the rise globally. Key forest ecosystems such as the Amazon continue to face the pressures of crop expansion for agricultural production, illegal extractive activities like timber harvesting and mining, relaxed legal enforcement and weakened environmental policies.

As deforestation persists, the planet’s capacity to absorb carbon pollution diminishes and more carbon is being released; tree cover loss in tropical forests accounts for about 16 to 33 percent of global emissions. We should be alarmed. But we should also be hopeful. Here are a few reasons why:

Read More »

Also posted in California, Carbon Markets, Forest protection, International, REDD+, United Nations / Comments are closed

The Getting to Zero Coalition: a step further towards decarbonization

Shutterstock

This post was authored by Aoife O’Leary, Natacha Crete and Marie Hubatova from Environmental Defense Fund Europe

Today at the United Nations Climate Action Summit, the youth movement with Greta Thunberg at its helm, called out the world leaders in attendance for a lack of action in the climate emergency. Greta’s impassioned plea again makes clear that the time for action is now. Action from all sectors. In the absence of real transformative action, we have no hope of meeting the temperature goals established by science and enshrined in the Paris agreement.

The UN Secretary General Antonio Guterres convened the climate action summit asking that countries and sectors come forward with scalable action. The summit is supposed to clarify the “how” in our path to avoiding catastrophic climate change. These provide the necessary catalyst for countries to take more ambitious commitments at the international climate negotiations in Glasgow in 2020. While much of what was announced today at the summit was pretty underwhelming, major players in the shipping sector have made significant effort to answer Guterres’ call.

Read More »

Also posted in International, United Nations / Comments are closed

Carbon markets: Can countries fill in the missing chapter of the Paris rulebook in Bonn?

https://www.flickr.com/photos/unfccc/48078728413/in/album-72157709079202332/

Bonn Climate Change Conference opening plenary. UNclimatechange

Negotiators are meeting in Bonn, Germany this week and next on the back of the successful negotiations in Katowice, Poland where the Paris climate agreement “rulebook” was mostly agreed, on time. A feat nearly unprecedented in the often glacial UN climate talks provides hope that countries can continue to work together in light of the urgency to address climate change.

The one exception to the success in Katowice was international cooperation through carbon markets. Despite taking the session into overtime, negotiators could not agree on a key chapter of that rulebook – the text meant to catalyze international cooperation on carbon markets under Article 6.

Among other things, Article 6 guidance will spell out how countries can “count” the results of international emissions reduction trading toward their Paris greenhouse gas reduction pledges (known as nationally determined contributions, or NDCs). Article 6 has three main components framing international cooperation under the Paris Agreement. Article 6.2 provides for the accounting framework, Article 6.4 establishes a new UNFCCC mechanism and Article 6.8 provides a framework for non-market approaches.

As one of the last items that need to be addressed after COP24, carbon markets will be a central focus of the negotiations in 2019 and Article 6 will benefit from additional political focus on the road to agreement at COP25 in Santiago de Chile in December.

Here we answer key questions about carbon markets and the UN climate talks.  Read More »

Also posted in Carbon Markets, International, United Nations / Comments are closed

What ProPublica’s forest carbon credits story still gets wrong – and right (with update)

By Steve Schwartzman, Senior Director, Tropical Forest Policy, and Christina McCain, Director, Latin America

Amazon Canopy. Warwick Lister-Kaye / istockphoto.com.

***Please read on for our response to ProPublica’s follow-up article***

ProPublica’s recent piece An (Even More) Inconvenient Truth is a deeply reported story on very real problems – and even bigger potential problems – with offset projects in existing and emerging carbon markets. But the evidence the article lays out does not support its conclusion about forest carbon crediting. And readers might come away without understanding that protecting forests, including through forest carbon credits, is one of the most important solutions to climate change out there, and the planet can’t afford to dismiss this opportunity to solve the climate crisis.

Missing: The critical distinction between individual “projects” and large-scale, state-level programs to reduce deforestation

It’s not news that bad carbon credits won’t solve climate change. Lots of studies have shown that there are all kinds of bad offset projects, and definitely not just forest projects. But today’s jurisdictional forest credits aren’t your parents’ forest project offsets: they’re real emissions reductions. Though you wouldn’t be able to tell that from the ProPublica story.

The ProPublica piece fails to distinguish large-scale national or provincial programs to reduce emissions from deforestation – known as “jurisdictional” programs – from one-off, small “projects” to reduce deforestation. ProPublica’s implication that old projects had failings and therefore now so must contemporary jurisdictional programs, is like saying flip phones had all sorts of problems, so all cell phones must be unreliable and we should shun smartphones.  Read More »

Also posted in Brazil, California, Carbon Markets, Forest protection, Indigenous People, REDD+, United Nations / Read 5 Responses