The development of the UN-regulated carbon market under Article 6.4 of the Paris climate agreement — now named the "Paris Agreement Crediting Mechanism" — is making some progress, with its supervisory body focusing not just on its tools and guidelines but also on addressing concerns raised by negotiators at the UN Cop 28 climate conference in Dubai last year.
Particularly strong concerns were raised at Cop 28 on the potential effect of carbon reduction activities on human rights and the environment. Supervisory body members stressed at their first post-Cop 28 meeting the fundamental importance of environmental safeguards for the new mechanism under its appeal and grievance procedure and sustainable development tool, both to be adopted at the next supervisory body meeting in the spring.
The meeting in Bonn, Germany, also saw the formal launch of the accreditation expert and methodological expert panels. The former will start accrediting auditors to verify and validate projects from April, while the latter will bring in further technical expertise for the development of standards, guidelines and tools for activities under the mechanism.
The body's proposals for methodologies and guidelines were thrown out at Cop 28, along with those on acceptable carbon removal activities under the mechanism. The body will continue to work on these issues, with final drafts expected to once again be put to the parties to the Paris deal at Cop 29 in Baku, Azerbaijan, in November.
The new mechanism is essentially a successor to the Kyoto protocol's clean development mechanism (CDM). About 1,300 requests to transition CDM activities to the new mechanism will need to be processed this year. The UN's climate arm and the supervisory body will also need to implement a registry infrastructure for Article 6.4 carbon credits, as well as conducting capacity building activities to assist countries in establishing institutional arrangements, reporting and baselines.
Capacity building in host countries is progressing, with the number of designated national authorities rising to 72 on 1 March from 64 on 2 November. The supervisory body decided at its meeting to establish a forum aimed at facilitating knowledge exchange and addressing shared challenges among authorities.
The body also pledged to recommend at Cop 29 that parties exempt Article 6.4 activities in least developed countries from the share of proceeds requirement — which transfers a portion of funds from the mechanism's credits to a climate adaptation fund — in a bid to encourage broader participation from these countries.
