Negotiations at COP 28 have failed to reach an consensus relating to Article 6 of the Paris Agreement.
Countries involved failed to agree on guidance under Article 6.2 and Article 6.4 of the Paris Agreement which cover international carbon credits. Article 6.2 provides a framework for countries to cooperate bilaterally or multilaterally, while Article 6.4 provides a centralized mechanism administered by the United Nations.
Negotiations on Article 6.2 failed over how much centralized oversight the UN should have and US concerns over efforts by the European Union to impose more detailed rules on Article 6.2. Despite the lack of an agreement on a framework on carbon trading, the terms of Article 6.2 agreed in previous years do enable bilateral carbon trading despite Article 6.2 lacking standards to raise the quality of credits. There also remains concern over whether international carbon credits transferred from government to government will be recognized under the Paris Agreement.
Dirk Forrister, President and CEO of the International Emission Trading Association (IETA), says, “Countries can and should implement international carbon markets under Article 6.2. While the lack of consensus at COP28 is disappointing, we are excited by the numerous agreements signed and projects underway.”
Andrea Bonzanni, International Policy Director at IETA, says “We missed an opportunity to expedite the operationalisation of a crediting mechanism that would have set a high bar on environmental integrity, safeguards, and human rights. The delay of the Article 6.4 mechanism is not a victory for environmental integrity, it is a victory for the anti-market agenda.”