COP27 FAQ: Article 6 of the Paris Agreement explained

The document provides a detailed breakdown of Article 6 of the Paris Agreement, distinguishing between the bilateral trading of Internationally Transferred Mitigation Outcomes (ITMOs) under Article 6.2 and the UN-overseen global carbon market under Article 6.4. It highlights critical risks such as double counting, the potential for 'junk' credits transitioning from the Clean Development Mechanism (CDM), and the lack of transparency in reporting. The guide also argues against the inclusion of avoided emissions and short-lived carbon storage as bases for credits, while advocating for mandatory cancellation rates to ensure overall mitigation in global emissions.

• Article 6.2 enables countries to trade Internationally Transferred Mitigation Outcomes (ITMOs) via bilateral or multilateral agreements, while Article 6.4 establishes a UN-governed global carbon market overseen by a Supervisory Body (6.4SB) to issue A6.4ERs.
• Double counting is primarily addressed through 'corresponding adjustments', where a selling country deducts credits from its own inventory; however, unregulated private voluntary credits and specific accounting for aviation (CORSIA) remain problematic.
• The transition of Clean Development Mechanism (CDM) projects to the Article 6.4 system poses a risk of issuing up to 2.8 billion 'junk' credits if outdated methodologies are used until December 31, 2025.
• Article 6.4 includes mandatory levies to support climate adaptation (5% share of proceeds) and to ensure overall mitigation in global emissions (2% cancellation of credits), though the 2% rate is criticized as too low.
• Avoided emissions are currently ineligible for carbon credits under Article 6 due to high risks of environmental worthlessness, though the Philippines has pushed for their inclusion.
• There are significant concerns regarding the definition of 'removals', specifically opposing 'tonne-year accounting' and arguing that removals must be stored for at least 200-300 years to be climate-relevant.
• Transparency in Article 6.2 reporting is contested, with some groups like the like-minded developing country negotiating group (LMDC) suggesting that all submitted information should be confidential.

APA

Crook, J. (2022). COP27 FAQ: Article 6 of the Paris Agreement explained. Carbon Market Watch. https://carbonmarketwatch.org/2022/11/02/cop27-faq-article-6-of-the-paris-agreement-explained/

Chicago

Crook, Jonathan. COP27 FAQ: Article 6 of the Paris Agreement explained. Carbon Market Watch, 2022. https://carbonmarketwatch.org/2022/11/02/cop27-faq-article-6-of-the-paris-agreement-explained/.

Wikipedia

{{cite report |last1=Crook |first1=Jonathan |title=COP27 FAQ: Article 6 of the Paris Agreement explained |publisher=Carbon Market Watch |date=2 November 2022 |url=https://carbonmarketwatch.org/2022/11/02/cop27-faq-article-6-of-the-paris-agreement-explained/ |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{crook2022cop27, author = {Crook, Jonathan}, title = {{COP27 FAQ: Article 6 of the Paris Agreement explained}}, institution = {Carbon Market Watch}, year = {2022}, month = nov, url = {https://carbonmarketwatch.org/2022/11/02/cop27-faq-article-6-of-the-paris-agreement-explained/}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }