Recommendations related to the role of carbon markets in the Paris Agreement

Carbon Market Watch argues for stringent rules to prevent double counting, 'hot air' credits, and the inclusion of REDD-plus in carbon markets. It advocates for a 'net atmospheric benefit' through discounting, the establishment of a share of proceeds for adaptation and loss and damage, and the integration of a human rights-based approach into the core agreement to protect vulnerable populations.

• To maintain environmental integrity, carbon markets must adhere to principles that avoid double counting of both mitigation efforts and financial flows. Double counting of international offsets could reduce the ambition of current pledges by up to 1.6 billion tonnes CO2e in 2020, which is approximately 10% of the total abatement needed to stay on a 2°C pathway.
• Carbon market units should be supplemental to domestic action and not used as a substitute for achieving nationally determined mitigation commitments (NDMCs). The document emphasizes that the focus must remain on transformative structural changes in infrastructure and technologies to achieve decarbonization by 2050.
• The document warns against the creation of 'hot air' credits—allowances that do not represent real additional reductions. It cites a loophole under the Kyoto Protocol that created an estimated 11 gigatonnes of such credits, and notes that EU countries bought over 500 million hot air permits to comply with targets in the 2008-2012 period.
• Carbon Market Watch strongly opposes the inclusion of REDD-plus in carbon markets due to concerns that biological carbon is not permanent and is susceptible to climate change impacts like fires and insect attacks. It suggests instead using a levy on carbon trading to fund the Green Climate Fund (GCF).
• To ensure a 'net atmospheric benefit' beyond pure offsetting, the document proposes the discounting of internationally traded units. This involves purchasing more units than are used for the mitigation target and cancelling the excess, effectively turning the market into a tool for climate finance for the host country.
• The document recommends that all UNFCCC carbon markets implement a 'share of proceeds' levy to provide financing for adaptation and loss and damage in developing countries, citing the CDM's 2% levy on projects as a useful precedent.
• A human rights-based approach is deemed critical to prevent negative impacts from climate projects. The document calls for the inclusion of human rights, gender equality, and the rights of indigenous peoples in the operative part of the Paris treaty (Article 2).
• Regarding international aviation and shipping, the document argues that the ICAO and IMO should develop sectoral targets consistent with the 1.5°C goal and establish a market levy to fund adaptation and loss and damage.

APA

Carbon Market Watch (n.d.). Recommendations related to the role of carbon markets in the Paris Agreement. https://carbonmarketwatch.org/wp-content/uploads/2015/11/Carbon-Market-Watch-COP21-recommendations_FINAL_web3.pdf

Chicago

Carbon Market Watch. Recommendations related to the role of carbon markets in the Paris Agreement. n.d. https://carbonmarketwatch.org/wp-content/uploads/2015/11/Carbon-Market-Watch-COP21-recommendations_FINAL_web3.pdf.

Wikipedia

{{cite report |author=Carbon Market Watch |title=Recommendations related to the role of carbon markets in the Paris Agreement |url=https://carbonmarketwatch.org/wp-content/uploads/2015/11/Carbon-Market-Watch-COP21-recommendations_FINAL_web3.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{carbonmarketwatchndrecommendations, author = {{Carbon Market Watch}}, title = {{Recommendations related to the role of carbon markets in the Paris Agreement}}, institution = {Carbon Market Watch}, url = {https://carbonmarketwatch.org/wp-content/uploads/2015/11/Carbon-Market-Watch-COP21-recommendations_FINAL_web3.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }