Felix von Geyer – Glasgow
Negotiations on Article 6 of the Paris Accord show signs of cautious optimism that agreement can be reached according to observers.
Article 6 addresses carbon markets and non-market carbon approaches, negotiations that spectacularly failed in the Madrid talks in 2019 over issues of carry-over of credits and projects from the Kyoto Protocol era as well as issues of corresponding adjustments.
Where the Madrid climate talks produced only three text versions during the whole UN climate Change Conference (COP25), COP26 had already produced a fourth text by the end of the first week.
While the text contains many brackets where “nothing is agreed until everything is agreed,” said one observer, the contentious issues centred around the idea of a levy on carbon trading under article 6.2 in the same manner as developing countries’ adaptation finance under Article 6.4.
Capacity-building under adaptation finance has already seen Japan increase its financing pledge to developing countries in place of a levy.
The diplomatic divide over a compulsory levy or voluntary contributions was configured in the latest text as countries being “warmly encouraged” to make voluntary contributions rather than a levy.
In Madrid, Brazil and Australia were culprits in stalling climate talks on the issue of carry-over of credits and projects under the Kyoto Protocol’s Clean Development Mechanism. As Least Developed Countries did not benefit from Kyoto era credits and consequently do not want to continue a long pipeline of inexpensive credits, raising concerns over the environmental integrity of these credits. Issues of extra additionality – effectively that such emissions reductions would not have happened otherwise – has prompted demands from LDCs for a new qualifying methodology to ensure environmental integrity.
Countries, notably the Coalition of Rainforest Nations spearheaded by Papua New Guinea, Gambia and the Dominican Republic want carbon credits generated through avoided deforestation, afforestation and reforestation under REDD+ to qualify automatically.
The complex technical issue of corresponding adjustments has become a quagmire of political and technical posturing. The idea of which party is credited with an emissions reduction if a buyer purchases a carbon credit from the selling nation has seen India, some Arab countries and some Africans countries resist corresponding adjustments which, if not agreed, could lead to issues of double-counting of emissions reductions in the quest for net zero emissions objectives.
According to one observer however, the general mood was more cooperative than in Madrid’s climate talks with countries appearing to want to achieve a compromise rather than remain in previously trenchant positions.
As of Monday morning of the second week of negotiations, the stock-taking plenary under the UK COP President Alok Sharma was addressing issues of financing, with calls for adaptation and mitigating finance to be an equal 50/50 split with issues of loss and damage – political terminology that within the insurance industry would fall under compensation and liability.