COP29 seals Article 6 deal for carbon trading, but environmental concerns persist
Countries at COP29, organised in Baku, Azerbaijan, managed to make a breakthrough in finalising rules related to Article 6 of the Paris Agreement, which addresses carbon trading. However, concerns over transparency and environmental safeguards continue. At COP29 in Baku, Azerbaijan, over 200 countries formally adopted key rules and guidelines for Article 6 on November 23, extending the negotiations beyond the scheduled dates of November 11–22. Two separate drafts were adopted: one for Article 6.2, addressing bilateral or multilateral carbon trading, and another for Article 6.4, focusing on a centralised carbon trading mechanism. The host country described Article 6 as a game-changing tool that can ensure the flow of $250 billion annually to developing countries to support their climate plans. However, experts warn that the agreed language on Article 6 is so weak that it could lead to increased emissions instead of reductions. For instance, inconsistencies when a country misreports emission reduction have been a major concern. The final draft related to Article 6.2, which deals with bilateral or multilateral carbon trading, sets several rules to correct inconsistencies. As per this draft, countries will have to submit the report to the United Nations Framework Convention on Climate Change (UNFCCC) at the beginning of the project and annually. However, parties have no deadlines to fix the discrepancies or penalties for not following the carbon credit rules. Few parties wanted a strong consequence, and the draft talks about putting the parties’ names in the public if persistent inconsistency is found, but is it enough? “Several other measures could have been adopted, countries could have been asked to not trade in Internationally Transferred Mitigation Outcomes (ITMOS), equivalent to a carbon unit, until a resolution is made to this particular kind of inconsistency, says Trishant Dev, a Programme Officer for climate change at Centre for Science and Environment (CSE), a Delhi-based think tank. There were other demands like incorporating human rights violations, etc, while setting the rules of future carbon trading, but it didn’t get space in the final draft, he added.
