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UN carbon markets: Have we exchanged enough views already?

Far from the sandy beaches of the South Pacific, the 23rd UN climate talks (COP23) was a mostly dreary endeavour in the grey of November in Bonn. The negotiations on the Paris Agreement’s market provisions, the Article 6, moved the process an itsy bit forward, while still leaving all the critical issues open to further discussion.

Negotiators arrived early for a roundtable, where country representatives presented their positions in a format designed for more discussion than in the large technical body (SBSTA)  meetings held during the sessions. While observers were not invited to follow the roundtable, they were, surprisingly, allowed in the room for most of the negotiation sessions – a departure from the last couple rounds of discussions.

Parties seemed to understand each other’s positions a bit better this time around, but they are still far from agreement on many fundamental details of how UN carbon markets will work after 2020.

Will global carbon markets increase climate ambition – or undermine it?

Critical questions on the functioning of future carbon markets remain wide open, making it impossible to assess if they will contribute to the fight against climate change.  These questions range from the level of international oversight and nature of accounting rules to the design of the so called Sustainable Development Mechanism and its relationship with the Cooperative Approaches.

Will accounting be based on emission inventories, targets, or … bizarrely a big zero? Are “mitigation outcomes” actually outcomes as in something that has happened? Will Cooperative Approaches contribute to an overall mitigation and generate a share of proceeds for adaptation? What aspects of the Clean Development Mechanism (CDM) will reemerge in the SDM? Will we undermine ambition for expanding the national determined contributions (NDCs) by allowing for crediting from emission sources not covered by the countries’ pledges?

A tiny little bit of progress, but a lot of work lies ahead

Most of the session in Bonn was spent sharing views which the Co-Chairs put down into various versions of “informal notes”. This was certainly a progression on submissions and talking past each other; SBSTA negotiators now have more concrete options and concepts in a common document that could be the basis for further discussion.  

However, after a productive beginning, the second week saw a lot of that work put into question. When it came time to draft decisions about how to proceed, there was suddenly a hold-up: a few parties refused to continue the talks before movement on other issues being discussed in other parts of the conference center. Rumours spread it had to do with “response measures”.

In the end, after a few “huddles”, extended talks lasting into early hours and again the next day, and a brief altercation involving one party/group who should have been consulted (but was somehow left out), representatives finally gave the SBSTA Chair a mandate to come up with “draft elements” to “facilitate further deliberations at SBSTA 48”.  This means that we have an actual text basis for negotiation at the next meeting. It’s a step forward, but a baby step, and we are only a very tiny little bit closer to knowing what Article 6 will actually look like.

As we move forward to the next climate conference in May, it is imperative that any future UN carbon markets increase climate ambition. Importantly, Cooperative Approaches cannot constitute a race to the bottom, the SDM needs to start from a clean slate leaving the problems of the CDM behind, and human rights and sustainable development must be at the center of any future international cooperation.


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Biodiversity markets are meant to channel private sector funding towards schemes that aim to conserve and restore biodiversity. In its current form, the unregulated funding schemes are reminiscent of the voluntary carbon market, which has a track record of supplying poor quality, cheap credits that inadequately transfer funds to the Global South. 

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