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PTCOP29: progress on Article 6 of the Paris Agreement
The Presidency of COP29, held in Baku, Azerbaijan, surprised many by announcing, on the first day of the event (November 11), that the countries had reached a consensus on rules for generating carbon credits under Article 6.4 of the Paris Agreement, removing barriers to the creation of a global carbon market. This point had caused impasses at the COP in Dubai last year.
Although it does not create the structure for the international carbon credit market to operate, the decision recognizes the authority of a supervisory body of specialists created to implement the system. The expectation is that the decision will drive climate action, ensuring that the international carbon market operates with integrity under the supervision of the United Nations.
What does the Article 6.4 say?
Article 6.4 concerns the generation of emission reductions or removals based on private projects, certified and validated by a supervisory body. It allows countries to exchange so-called “Internationally Transferred Mitigation Outcomes” (ITMOs) among themselves, and is part of the rulebook of the Paris Agreement, a global pact established in 2015 for countries to join forces to reduce emissions and limit global warming to 1.5°C.
The full functioning of this article is important because credits are cost-effective solutions to support companies in meeting decarbonization goals. In this context, the new text of Article 6 could reduce the cost of implementing national climate plans by up to US$250 billion per year by 2035, according to the official COP29 website, mainly by allowing cooperation across borders.
UK PACT
WayCarbon is one of the companies selected to support the Brazilian Federal Government in achieving its decarbonization goals. During the event, on November 14, a project was announced focusing on financing for the decarbonization of Brazilian industry led by WayCarbon, in consortium with WRI Brasil.
Funded by the British Government’s UK PACT program, the project has the Brazilian Ministry of Development, Industry, Trade and Services (MDIC) as its beneficiary. “The work will involve strategically thinking about the flow of financing for the decarbonization of industry in the country, the obstacles and alternatives to put the process into practice. It is an honor for WayCarbon to support the Federal Government and the Brazilian industry on this journey”, said Felipe Bittencourt, CEO of WayCarbon.
UK PACT is the flagship program of International Climate Finance (ICF), which pledges £60 million for projects aimed at tackling climate change. Funded by the UK’s Department for Business, Energy and Industrial Strategy (BEIS), UK PACT’s mission is to: help partner countries increase their ambition to fight climate change and accelerate their transition to green growth; improve the capacity of partner countries to actually reduce greenhouse gas emissions; and help countries reduce harmful carbon emissions and reduce poverty by creating more opportunities in a carbon neutral economy.
References
https://cop29.az/en/media-hub/news/cop29-opens-in-baku-with-breakthrough-on-global-carbon-markets
