U.N. carbon market talks to drag beyond COP27 as deals elusive

SHARM EL-SHEIKH, Egypt, Nov 17 (Reuters) – Negotiations to create a carbon offset market that would allow countries to buy credits to meet part of their climate pledges will be delayed until after the COP27 summit, observers and an expert said. and continue into next year. Negotiators for United Nations negotiations.

Under the international carbon market first required under Article 6 of the 2015 Paris climate agreement, it may be years before countries can offset their emissions through greenhouse gas reduction projects elsewhere.

“After years of negotiations about whether carbon markets under the Paris agreement would actually exist, now they’re at the stage where they’re actually going to be set up,” said Jonathan Crook, a policy analyst at the nonprofit Carbon Market Watch.

A draft document of about 60 pages released on Wednesday outlines how carbon trading between countries would work, but is full of sections still to be debated and pointers to future decisions.

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“The text of Article 6 is all open,” Andrea Bonzanni, director of international policy at the International Emissions Trading Association (IETA), said on Thursday.

Pedro Barata, a carbon market expert at the Environmental Defense Fund, said that while he was impressed by the size of the draft document, he said it was clear that “it’s not going to lead to doing everything here to eliminate all Decisions on these issues.”

Key unanswered questions include the extent to which national registries or digital ledgers of carbon trading might be subject to external scrutiny.

Matt Williams of Energy and Climate Intelligence said he was concerned about transparency and the potential for double counting of the same credit in two countries.

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The slow progress in carbon market talks comes as countries struggle to agree on a long list of climate issues, with a summit scheduled for Friday drawing to a close.

“It’s a step forward, but I don’t know if it’s the big leap that might be needed,” said one negotiator, speaking on condition of anonymity.

Wednesday’s draft document referred only to the subsection of Article 6 dealing with how countries use carbon markets.

Discussion also lagged on another subsection related to the interplay of national carbon credit registries and so-called voluntary carbon markets, where carbon offsets are already traded between private parties.

As of this writing, the draft negotiating text, which delegates expected to emerge by noon Thursday, had still not been circulated. Observers say some of these rules could be repealed and redrafted to define what constitutes a carbon removal project before more talks are held in 2023.

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“Article 6 also has the opportunity … to set high standards for transparency and integrity, which would improve the wild west of unregulated voluntary carbon markets,” Crook said.

Reporting by Shadia Nasralla and Kate Abnett; Additional reporting by Valerie Volcovici and Jake Spring; Editing by Lisa Shoemaker

Our Standards: The Thomson Reuters Trust Principles.

Sathya Nasrallah

Thomson Reuters

Writes about the intersection of corporate oil and climate policy. Has covered politics, economics, immigration, nuclear diplomacy, and business in Cairo, Vienna, and elsewhere.

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