VIEWS ON THE USE OF CARBON MARKETS UNDER A POST-2020 CLIMATE DEAL

Carbon Market Watch argues that previous market-based mechanisms, such as the CDM and EU ETS, failed due to oversupply and poor environmental integrity. To prevent these failures in a post-2020 regime, the organization recommends strict eligibility rules based on national ambition, the exclusion of REDD-plus and agriculture from carbon markets, and the implementation of discounting to ensure net atmospheric benefits. It further calls for a UN-led standard-setting body, a robust institutional safeguard system to protect human rights, and a share of proceeds from all traded units to be allocated to the Adaptation Fund.

• Past market-based mechanisms have been characterized by a demand-supply imbalance and oversupply; specifically, the European Emissions Trading Scheme (EU ETS) and International Emissions Trading (ET) under the Kyoto Protocol were oversupplied by 2 billion and 13 billion allowances, respectively.
• Eligibility to participate in international carbon markets should be restricted to countries with absolute reduction targets based on historical reference levels and ambitious mitigation targets aligned with the 2C degree target.
• To ensure environmental integrity, certain project types should be banned via a 'negative list', including industrial gas projects (HFC-23), nitrous oxide reduction from adipic acid production, large power projects (coal and hydro), and specifically REDD-plus and agriculture activities.
• To prevent double counting and ensure a net atmospheric benefit, the document proposes that host countries subtract sold units from their INDC, and that 'discounting' be used, where more units are purchased than are used for compliance and the remainder are canceled.
• The document recommends that units generated before 2021 should be excluded from counting toward pledge attainment under the 2015 agreement to avoid the carry-over of Kyoto-era units.
• Governance of the FVA should include a UN body as a standard-setting organization, a common accounting framework with unique serial numbers for each tonne, and an institutional safeguard system to address human rights and social impacts.
• The Adaptation Fund should be supported by a share of proceeds from all internationally traded units transferred under the FVA, mirroring the 2 per cent share of proceeds from the CDM.
• The document advocates for a global phase-out of hydrofluorocarbons (HFCs) through the Montreal Protocol rather than through the use of carbon markets, which it describes as a 'signal failure'.

APA

Carbon Market Watch (2014). VIEWS ON THE USE OF CARBON MARKETS UNDER A POST-2020 CLIMATE DEAL. https://carbonmarketwatch.org/wp-content/uploads/2014/11/CMW_Position_CarbonMarkets_post2020_final.pdf

Chicago

Carbon Market Watch. VIEWS ON THE USE OF CARBON MARKETS UNDER A POST-2020 CLIMATE DEAL. 2014. https://carbonmarketwatch.org/wp-content/uploads/2014/11/CMW_Position_CarbonMarkets_post2020_final.pdf.

Wikipedia

{{cite press release |author=Carbon Market Watch |title=VIEWS ON THE USE OF CARBON MARKETS UNDER A POST-2020 CLIMATE DEAL |date=November 2014 |url=https://carbonmarketwatch.org/wp-content/uploads/2014/11/CMW_Position_CarbonMarkets_post2020_final.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@misc{carbonmarketwatch2014views, author = {{Carbon Market Watch}}, title = {{VIEWS ON THE USE OF CARBON MARKETS UNDER A POST-2020 CLIMATE DEAL}}, publisher = {Carbon Market Watch}, year = {2014}, month = nov, url = {https://carbonmarketwatch.org/wp-content/uploads/2014/11/CMW_Position_CarbonMarkets_post2020_final.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }