Seoul, Republic of Korea – 17 January 2023 – Article 6 of the Paris Agreement establishes a mechanism for government and private sector to achieve the scale of transformation required for keeping within 1.5 °C climate change goal. Article 6 carbon markets offer the opportunity for countries to engage in cooperative approaches to greenhouse gas emissions, resulting in more cost-effective reductions, notes GGGI in a recent technical report. The technical report titled Developing Carbon Markets based on Article 6 of the Paris Agreement: Challenges and Opportunities presents GGGI’s and its Members’ experiences in Article 6 engagement, explores the needs and barriers to meaningful, equitable participation in carbon markets, and offers a solution through an innovative new GGGI initiative the Carbon Transaction Platform (CTP).
The report integrates the findings of GGGI’s Global Survey on Article 6 Readiness, which included discussions with 29 of its 45 Member governments. “Almost everyone we talked to indicated that their governments are considering participating in carbon trading under Article 6,” Fenella Aouane, GGGI’s Deputy Director and Head of the Carbon Pricing Global Practice said. “However, potential seller countries are perceiving gaps in equity between buyers and sellers and are expressing a need for substantially more capacity building support to confidently engage in Article 6 activities. We are eager to respond to these needs and enhance engagement between buyers and sellers,” Ms. Aouane added.
The report also describes GGGI’s experiences in supporting Article 6 readiness, which led to its initial proposal for the CTP. Since 2019, GGGI has actively developed and implemented a range of technical support activities for its Members through its Carbon Pricing Global Practice. “The CTP will aim to scale up readiness support and facilitate Article 6 transactions. Through CTP, GGGI will focus on addressing uncertainties like how the compliance and voluntary markets will interact and on eliminating barriers to equitable participation in the carbon market by scaling knowledge exchange and transfers,” Ms. Aouane noted. In 2023, GGGI aims to operationalize the CTP both by establishing carbon trust funds and by facilitating government agreements to transfer mitigation outcomes internationally.
The full report can be scanned and downloaded at Developing Carbon Markets based on Article 6 of the Paris Agreement: Challenges and Opportunities — Global Green Growth Institute (gggi.org)