Article 6 Discussions at COP28

December 11, 2023

Discussions on Article 6 during the initial 10 days of the 28th Conference of Parties (COP) to the United Nations Framework Convention for Climate Change (UNFCCC) have seen both progress and challenges. The focus has been on refining rules and procedures for market approaches, with the aim of finalizing frameworks for Article 6.2, Article 6.4, and Article 6.8.

Article 6.2: Operationalizing Carbon Markets

Guidelines for Operationalizing Carbon Markets: Discussions have centered around guidelines for operationalizing carbon markets under Article 6.2. This involves the transfer of Internationally Transferred Mitigation Outcomes (ITMO), facilitating carbon credit transactions between countries.
Cooperative Approach Definition: Key elements include defining a ‘cooperative approach,’ authorizing processes, ITMOs and entities, sequencing and timing of report submission, and authorization by Parties. The co-facilitators are working to streamline the text and focus on essential elements for operationalizing the article.
Divergent Views: Parties have divergent views on the definition of cooperative approaches, with some advocating for a broad definition and others seeing it as necessary to exclude certain mechanisms. The presidency has set deadlines for concluding technical discussions, prompting co-facilitators to work on achieving consensus through informal sessions.

Article 6.4: Supervisory Body’s Work

Rules, Modalities, and Procedures: Negotiations under Article 6.4 focus on rules, modalities, and procedures, particularly concerning the supervisory body’s annual report. This body is tasked with developing standards for mitigation activities generating emission reduction units (6.4ERs).
Challenges with Removal Activities: Challenges include discussions on removal activities, encompassing nature-based and technology-based removals. Varying standpoints exist on accounting, the inclusion of nature-based removals, the scale of removal activities, and the permanence of carbon storage.
Procedural Elements: Negotiations also address procedural aspects such as the authorization of emission reduction activities, interoperability and connection between registries, and timing preferences for authorization.

Article 6.8: Non-Market Approaches

Lagging Progress: Article 6.8, focused on non-market approaches, lags behind in development compared to market mechanisms. The web-based platform announced in 2021 for identifying opportunities has not yet been operational.
Differing Views on Carbon Pricing: The draft text includes discussion on whether ‘carbon pricing’ should be considered a non-market mechanism under Article 6.8. Differing opinions exist, with some opposing this designation and others, like the European Union, advocating for a broader interpretation.
Proposal for Moratorium: Bolivia has proposed a moratorium on Article 6.4 operationalization until similar progress is achieved under Article 6.8. Concerns have been raised about the unbalanced consideration of cooperative approaches and the neglect of non-market-based approaches.

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