Voluntary Carbon Market Needs Quality and Transparency (Again)

2023 will be yet another crucial year for the international carbon market community. For many parties, Article 6.4 is the best way to get access to the international carbon market in a fair and transparent manner. Article 6.4 allows states to cooperate in the implementation of their climate protection contributions and to transfer emission reductions among themselves. In doing so, they are supervised by the Supervisory Body mandated by the Conference of the Parties.

A critical mass of decisions is required to get the system up and running. The Dubai summit should lead to a solid basis so that market participants can build trust in the market and start investing under Article 6.4. All eyes are on the Article 6.4 Supervisory Body again this year, which has another gigantic task on its desk ahead of the Dubai summit. Important break-throughs are needed in terms of removal activities as well as on methodologies and baseline setting.

The recently published Carbon Mechanisms Review (CMR) titled "Integrity first! The Voluntary Carbon Market must restore quality and transparency" reports on options for developing methodologies aligned with the Paris Agreement and presents one of the most important capacity building initiatives, the Paris Agreement Article 6 Implementation Partnership.

The cover feature of the issue addresses the latest developments in the voluntary carbon market: Stephan Wenzel, Parliamentary State Secretary at the Federal Ministry for Economic Affairs and Climate Protection, lays out why the strict separation of voluntary carbon markets and Paris carbon markets is unacceptable and how governments can support and guide the market towards robust and credible net zero targets in line with the Paris Agreement. In addition, Thomas Forth, advisor to the German Federal Ministry for Economic Affairs and Climate Protection, deals with harvested wood products under Article 6 in his contribution "A topic on repeat - Harvested Wood Products under Article 6". Authors from Japan's Ministry of Environment contribute "The Paris Agreement Article 6 Implementation Partnership" and explain how a swift and robust capacity building for carbon markets could look like. Furthermore, in the article "Advancing the development of Article 6 methodologies", researchers from the Perspectives Climate Group show how the reference case methodologies developed for the Kyoto Protocol can be refined and how a robust set of new methodologies for Article 6.4 can be created. Finally, "Industrial N2O: Mapping the potentials", a contribution by researchers from the Öko-Institut and the Deutschen Gesellschaft für internationale Zusammenarbeit, illustrates mitigation potentials for nitrous oxide emissions from the chemical industry in industrialised countries worldwide.

The Carbon Mechanisms Review 1/2023 is available free of charge under the link below.