Carbon Market Watch

COP29 will determine whether Article 6 of the Paris Agreement can deliver better rules for carbon markets, or whether it will fast track implementation at the expense of quality and accountability. CMW's Isa Mulder explains what's at stake in Baku. CMW's COP delegation: Policy: Sabine B Frank Gilles Dufrasne Isa Mulder Federica Dossi Jonathan Crook (remotely) Comms: Khaled Diab Noemí Rodrigo Sabio (remotely) Find out more on our COP29 landing page: https://lnkd.in/erNpDtHd Follow our adventures in Baku on Instagram: https://lnkd.in/e7hY8vAZ

Over 80% of carbon credits issued by more than 2,000 projects have a much lower climate impact than they claim, a new meta study whose lead author is Benedict Probst finds. This echoes the findings of our own research into REDD+ forestry projects. Jonathan Crook reports on the implications of these findings for the voluntary carbon market. https://lnkd.in/eZHYTbKV

Join us today for an ETS Talk on making the most of the EU’s Social Climate Fund for a just transition. Speakers include policy experts from Carbon Market Watch, ZERO - ASSOCIAÇÃO SISTEMA TERRESTRE SUSTENTÁVEL, European Environmental Bureau and Transport & Environment (T&E), who will answer the following questions: 💭What are the main processes and requirements for preparing and developing national Social Climate Plans? ✊What opportunities exist for civil society and other stakeholders to advocate for fair and impactful climate actions? 🚌What are the most effective spending measures to provide zero-emission transport options for those affected by transport poverty? 🏙️How can the Social Climate Fund improve renewable energy access for vulnerable households, especially in rented or multi-home buildings? ♻️How can the Social Climate Fund contribute to a citizen-driven, 100% renewable energy system? Full details and registration info here: https://lnkd.in/eKUsE_Y8

Yes, we CAN.

Our latest newsletter, travels to Baku to explore what's at stake at the #COP29 climate conference. In addition, we delve into the social dimension of climate action. Effective carbon removals policies are also on the menu. In short, plenty of food for thought... and action.

Rather than undermining efforts to bring down indirect emissions, companies should focus on embarking on real climate action and lobbying governments to impose stricter regulations that compel stragglers to get their act together. This was the message delivered by Gilles Dufrasne, our global carbon markets lead expert, at a #COP29 event on 'innovating solutions to scope 3 decarbonisation challeges'. The discussion was organised by The Sunrise Project Inc.

Our lead on global carbon markets Gilles Dufrasne outlined the virtues of abandoning suspect offsetting practices in favour of transparent contribution claims in which a company says it finances climate action without suggesting that this in any way compensates for its emissions. Gilles was speaking at a joint #COP29 side event we co-organised with Wuppertal Institute for Climate, Environment and Energy NewClimate Institute myclimate Find out more about the contribution model in this useful FAQ on credible climate claims https://lnkd.in/eHk8WJkw

Ahead of this evening’s hearing of Commissioner-designate Ribera, CMW is looking for reassurance that new State aid rules and their implication on the Clean Industrial Deal (CID) won’t translate into a watering down of the EU’s climate commitments. CMW policy experts Lidia Tamellini and Marlène Ramón Hernández highlight the key issues🔬 🫤One of the main responsibilities for her mandate is overhauling State Aid rules. Ribera outlined her position connected to the CID, reassuring her willingness to maintain a level playing field, but did not mention social or environmental conditionalities, neither for energy-intensive industries nor for cleantech  🫰The Commissioner-designate refers heavily to the Draghi and Letta reports, and highlights her belief that CO2 emissions and GDP growth can and should be decoupled. This is commendable, but the idea she seems to pursue that competitiveness and decarbonisation should move at the same pace can mask risks that occur when economic fluctuations are unfavourable: we are on a tight timeline to maintain our commitment to the Paris Agreement, and decarbonisation goals should be prioritised over industry profits. 🧑🌾Unfortunately, Ribera does not lack enthusiasm for the Carbon Removals and Carbon Farming Framework (CRCF), which at present is missing clear sustainability safeguards to foster biodiversity, resilience and soil fertility. 🌱Ribera’s faith in potential ‘nature-credits’ also fails to acknowledge the numerous challenges of ensuring that additionality requirements are met, and that robust monitoring, reporting and verification criteria are in place. It should be noted that with a lack of CRCF use cases, there remains a clear risk that potentially low-quality credits are used to offset emissions, which ultimately deters polluting actors from engaging in much needed emissions cuts themselves.

Our policy expert Isa Mulder spoke at a #COP29 event titled 'UNFCCC: Advancing integrity in carbon markets with the Paris Agreement crediting mechanism' which focused on Article 6.4 carbon markets. Isa highlighted some of the shortcoming and loopholes and urged the Article 6.4 Supervisory Body to take the requisite time and effort to fix them. #FixArticle6 If you are registered with the UNFCCC, you can watch the debate here. https://lnkd.in/e58iFN4F

At this afternoon’s hearing of Commissioner-Designate Séjourné, Carbon Market Watch is paying close attention to the candidate plans for the upcoming Clean Industrial Deal (CID) and the effect it will have on carbon pricing legislation. CMW policy expert Lidia Tamellini sets the scene 👇 💪The Commission has reasserted  its willingness to build on existing legislation, and not to steer away from the Green Deal. Its vision for the CID is built on the existing path, valuing circularity as well as coordination between legislative files and  overlapping policies. It aims at strengthening integration of internal markets and funding instruments. 😶🌫️However, there’s little mention of what industries will need to deliver in terms of emission reductions and social guarantees. Will the only requirement be to respect what was already agreed with the lowering ETS cap, and the general greenhouse gas emission reductions goals? Will there be no specific goals set for energy-intensive industries to decarbonise while maintaining quality jobs in Europe? 📜Commissioner-designate Séjourné confirms (echoing Hoekstra’s hearing from last week) the foreseen revision of the Carbon Border Adjustment Mechanism (CBAM) in 2025, even mentioning a potential inclusion of indirect emission under its scope. With many challenges during the monitoring period relating to transparency across value chains, overreliance on default values, and a lack of actual reporting from importers, close oversight from the Commission, alongside the capability to quickly react to issues as and when they arise, will be essential as the instrument kicks in in 2026. 🔎It’s also reassuring that Séjourné confirms the Commission’s commitment to look closely into circumvention of rules and potential loopholes, to expand the scope to more downstream products (although no mention of solidifying the list of precursors), and to look into options for exports. Indeed, CBAM’s “potential for climate protection” is huge, and should be leveraged as such. ✊However, the transition must be just: Séjourné stresses that no exemptions will be made for Least Developed Countries, and the 2025 report will shed light on the impact that the mechanisms will have on their exports into the EU. If no exemptions will be made for developing economies, it is high time to confirm financial support through CBAM revenues for their transition, to avoid a disproportionate impact.