The future centralised carbon market under Article 6.4 of the Paris climate agreement made progress this week, with the mechanism's regulator planning to reach agreement on the basics for the difficult issue of carbon removals in time for the UN Cop 28 climate conference.
The Article 6.4 supervisory body decided at a meeting in Bonn, Germany, this week to add further, virtual meetings ahead of Cop 28 to clinch agreement on a final recommendation on activities involving carbon removals, as well as the second difficult issue of methodologies underpinning Article 6.4 activities.
The body earlier this year gave up plans to finalise these rules in time for Cop 28, which will take place in Dubai, UAE, over 30 November-12 December, instead agreeing to limit itself to finalising guidance.
The issues of removals permanence and reversals, setting baselines against which to measure reductions, and sharing benefits between participating parties, are among the disputed aspects.
The supervisory body will set up a "reversal risk buffer pool" to insure against the general risk of, and remediate, unavoidable reversals, it agreed at the meeting. Activity participants will contribute Article 6.4 emissions reductions to the pool.
The body will develop further guidance on avoidable versus unavoidable reversals, and how to treat uncancelled buffer emissions reductions, the meeting report said.
The supervisory body also established a methodological expert panel and an accreditation panel, for which the UN climate change secretariat will launch a call for experts. The accreditation panel will support the implementation of standards and procedures for accrediting operational entities that conduct validations and verifications of Article 6.4 activities. The methodological expert panel will support the creation of methodological standards, guidelines and clarifications.
The secretariat will also launch a consultation on the proposed Article 6.4 sustainable development tool, which is to enshrine the environmental, developmental and social safeguards of activities under the mechanism, and on a grievance procedure. The supervisory body aims to pass both in late April or early May.
The supervisory body adopted at the meeting a standard and procedure for transitioning activities from the Kyoto Protocol's clean development mechanism (CDM) to Article 6.4, to be effective from 1 January 2024. Article 6.4 broadly aims to replace the CDM without replicating its shortcomings, for instance in terms of sustainability or social standards.
By this week 3,329 CDM project activities and 165 CDM programmes of activities have requested to transition to Article 6.4. This constitutes total potential emission reductions of 1.41bn t of CO2 equivalent.
Capacity building in host countries has made some progress. The number of designated national authorities had reached 64 by 2 November, from 55 in mid-September, according to the meeting report.
The supervisory body also adopted an activity standard, a validation and verification standard, and an activity cycle procedure for projects, to be effective from 1 January 2024.
