Carbon markets must benefit people and the planet – anything less is unacceptable

The article was first published on Carbon Markets at COP25 blog on 8th December 2019

50 km southeast of Santiago, in the Cajon del Maipo region, the Alto Maipo Hydropower Project has become one of the biggest environmental struggles in Chile’s history.

An NGO action at COP25 called for strong social and environmental safeguards in global carbon markets © Miriam Vicente

The project – due to be completed by 2020 – threatens the water supply of the seven million inhabitants of Santiago. It has destroyed the social fabric of the towns of El Alfalfal and Los Maitenes along the river, by favouring some parts of the population and excluding others from the benefits of the project. Livestock, beekeeping and tourism activities, developed by the communities of El Alfalfal and Los Maitenes, have suffered irreversible damage with direct consequences on the economic development of these villages.

“Alto Maipo destroyed all the native vegetation that we had here.” – anonymous local resident at river Maipo

In Panama, the Barro Blanco hydroelectric dam violated the rights of communities, causing severe damage to their livelihoods, flooding their lands and cultural sites. Violent clashes between local indigenous communities and authorities led to three people being killed.

What do Alto Maipo and Barro Blanco have in common?

Both were pitched as “clean development” projects for the public good. Both were carried out without comprehensive environmental assessments and without effectively involving local communities into the decision-making.

And both were approved by the UN Clean Development Mechanism (CDM) to generate carbon credits that would be sold to countries/companies/individuals that want to offset their emissions through paying for green projects in other countries.

Barro Blanco has since been deregistered from the CDM – which is a great campaign victory – but the project itself is moving forward which means that the situation for people on the ground remains unchanged.

“We want progress that builds and protects the environment – not progress that destroys it.” – Manolo Miranda, Ngäbe leader, Panama

Looking ahead

The 197 member countries of the UN climate agency (UNFCCC) are currently gathered in Madrid, to hammer out rules for future carbon markets under the Paris Agreement.

To avoid repeating past mistakes, such as Alto Maipo and Barro Blanco, future markets need strong rules and social and environmental safeguards. All climate projects must benefit local communities, and protect the environment.

This means that Article 6 rules of the Paris Agreement must include provisions for mandatory and inclusive stakeholder consultations that take place at the onset and throughout the project duration.

Furthermore, even safeguards in place and with a thorough consultation process, things can and do still go wrong. This is why it is crucial to set up an independent grievance redress mechanism to ensure that affected communities have proper channels to seek redress if needed. One of the major failures of the CDM, such a mechanism is missing from the current offsetting scheme.

Carbon markets as a topic may seem distant, technical, incomprehensive. Yet as Alto Maipo and Barro Blanco show, we must remember that what is decided in these halls will have real impacts on people on the ground.

Only the kind of climate action that involves people, protects their livelihood, cultures and the environment can be successful. We have to learn from past mistakes if we are to stop the climate crisis and ensure a just transition to carbon-free societies.

An outcome from Madrid that doesn’t include safeguards for human rights and the environment is simply not acceptable.