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The document advocates for the strengthening of the EU's Effort Sharing Regulation (ESR) to ensure Cyprus and the EU meet Paris Agreement goals. It identifies transport, waste management, and building heating/cooling as key sectors for emission reductions in Cyprus and proposes specific policy improvements, including higher 2030 and 2050 targets, more accurate emission baselines, and stricter governance to prevent the use of legal loopholes in forestry and the Emissions Trading System (ETS).

The document claims that the steel sector is projected to receive €49 billion in pollution subsidies between 2021 and 2030, based on an average carbon price of €25/tCO2, and notes a further claim by the industry for €4 billion for waste gases.

The report identifies four primary loopholes in the proposed 2030 Effort Sharing Decision (ESD) that could undermine the EU's climate goals. These include the use of land use offsets (LULUCF), the inflation of carbon budgets based on 2020 targets, the use of surplus EU ETS allowances, and the carry-over of unused carbon permits ('hot air'). Collectively, these loopholes could result in the EU emitting 4.7 billion tonnes more CO2-equivalent than pledged, potentially allowing emissions to increase rather than decrease between 2021 and 2030.

Signatories call on the UK government to revoke authorization for two CDM projects managed by Exportadora del Atlántico (a subsidiary of Grupo Dinant) in the Aguan and Lean regions of Honduras. The letter argues that the projects are linked to violent land conflicts, including the murder of peasants and the use of project sites by military forces. Additionally, it challenges the 'additionality' of the projects, noting that the company received millions in loans from the World Bank's IFC and the Inter-American Investment Corporation for biogas production, which was not disclosed in the project documentation.

Carbon Market Watch and Opportunity Green call on the European Commission to maintain its climate leadership by resisting U.S. pressure to exempt international aviation from the EU ETS. The authors argue that the ICAO's CORSIA scheme is an inferior alternative to the ETS because it lacks an emissions cap and relies on inadequate offsetting. They highlight that in 2023, flights leaving EEA airports emitted 133 MtCO2, with less than half reported under the ETS, and warn that yielding to U.S. threats, such as the EU ETS Prohibition Act, would undermine EU sovereignty and climate goals.

The Human Rights and Climate Change Working Group and associated organisations call on EU leadership to champion human rights within the Paris Agreement. They argue that climate change disproportionately affects vulnerable populations and that climate actions themselves can cause human rights abuses without safeguards. The letter specifically requests support for an amended Article 2(2) of the draft text to recognise the protection of human rights, indigenous peoples' rights, gender equality, and a just transition for the workforce.

A coalition of environmental organizations calls on the chair of the Environment Council to increase the ambition of the Effort Sharing Regulation (ESR) and ensure robust accounting for land use, land use change and forestry (LULUCF). The authors argue that the current ESR proposal is inconsistent with the Paris Agreement and propose specific reforms, including higher emission reduction targets, the removal of forestry and ETS loopholes, and the implementation of stricter governance and compliance mechanisms.

The Effort Sharing Regulation (ESR) is the EU's primary instrument for reducing greenhouse gas emissions in sectors not covered by the Emissions Trading System (ETS), accounting for approximately 60% of total EU emissions. For the 2021-2030 period, the ESR sets an overall target of -30% compared to 2005 levels, with individual Member State targets ranging from -40% to 0% based on GDP per capita. The regulation covers transport (35%), buildings (25%), agriculture (17%), industry (16%), and waste (5%). To ensure compliance, the ESR utilizes Annual Emission Allocations (AEA) and various flexibility mechanisms, including banking, borrowing, and trading units between countries, though some are criticized as 'loopholes' that may undermine decarbonization.

The Santa Rita Hydroelectric Plant in Guatemala's Alta Verapaz region was registered as a Clean Development Mechanism (CDM) project in June 2014 despite strong opposition from local indigenous communities. The document asserts that the project violated the Guatemalan Agreement on Identity and Rights of Indigenous Peoples, ILO Convention 169, and CDM Modalities and Procedures by failing to conduct proper public consultations. This lack of compliance is linked to severe human rights abuses, including the alleged deaths of seven people and repressive police operations against Q’eqchi´ communities. The project is funded by the Latin Renewables Infrastructure Fund (LRIF), with investments from the IFC (USD 15mln), SIFEM (USD 7mln), DEG, FMO, and AECID. Civil society organizations have filed complaints with the Compliance Advisor Ombudsman (CAO) and the IFC, demanding the withdrawal of financing and the cancellation of the CDM registration.

The Santa Rita hydroelectric project on the Dolores River in Alta Verapaz, Guatemala, was registered under the Clean Development Mechanism (CDM) in June 2014 despite strong opposition from local Q’eqchi’ communities. The document reports that the project violated the Guatemalan Agreement on Identity and Rights of Indigenous Peoples, ILO Convention 169, and CDM procedures by failing to conduct appropriate public consultations. This lack of consultation and the subsequent project development led to severe human rights abuses, including the alleged extrajudicial killings of seven people, including two children, and violent police repression against indigenous families in August 2014. The project is funded via the Latin Renewables Infrastructure Fund (LRIF), with investors including the International Finance Corporation (IFC), which contributed 15 million dollars, and the Swiss Investment Fund for Emerging Markets (SIFEM), which contributed approximately 7 million dollars. In October 2014, civil society organizations filed a formal complaint with the Compliance Advisor Ombudsman (CAO) of the IFC, citing a lack of public consultation and the criminalization of opponents. The document uses this case to advocate for a human rights-based strategy in the 2015 climate agreement, noting that climate actions must respect and protect human rights.

The handbook evaluates six carbon removal methods: BioCCS, afforestation/reforestation, biochar, terrestrial enhanced weathering, DACCS, and soil carbon sequestration. It highlights the trade-offs between permanence, cost, and ecological impact, emphasizing that land-based solutions often conflict with planetary boundaries and food security, while technological solutions like DACCS face high energy and cost barriers. The document recommends prioritizing sustainable feedstocks, rights-based approaches for local communities, and the development of standardized monitoring, reporting, and verification (MRV) frameworks.

The report argues that deep decarbonisation of EU energy-intensive industries requires a combination of process innovations, product shifts, and business model transformations. For chemicals, this involves transitioning to bio-based feedstocks and enhanced plastics recycling. In steel, the HIsarna process and a shift toward electric arc furnace (EAF) production from scrap are highlighted. For cement, the report emphasizes calcium looping carbon capture and storage (CCS) and clinker substitution. It concludes that public policy, specifically the EU ETS Innovation Fund, is essential to bridge the gap between demonstration and commercialisation of these technologies by 2030.

The report by Carbon Market Watch outlines a framework for 'carbon pricing done right,' arguing that such systems must be integrated into broader policy packages and based on strict emission caps to be effective. It emphasizes the 'polluter pays principle,' warning against free allocations and offsets, which it claims can weaken price signals and lead to greenwashing. The document advocates for transparency, the reinvestment of revenues into climate action and vulnerable communities, and a cautious approach to carbon leakage and border adjustment mechanisms to avoid protectionism while ensuring climate justice.

Carbon Market Watch and several partner organisations call for the immediate phase-out of free EU ETS allowances, arguing they create market failures and hinder industrial transformation. The letter advocates for full auctioning of allowances to generate revenues for green investments, the removal of free allocations for sectors covered by the Carbon Border Adjustment Mechanism (CBAM), and the rejection of a Carbon Leakage Protection Reserve. It further proposes increasing the minimum annual benchmark reduction rate to 1% and integrating carbon pricing into a broader regulatory framework including pollution performance standards and green public procurement.

The document asserts that fossil and biological carbon operate on fundamentally different timescales and cycles, making them non-fungible. While fossil carbon is permanent, biological carbon is subject to rapid fluxes and risks of reversibility from fires, pests, or rising temperatures. The author contends that relying on biological offsets to mitigate fossil emissions is scientifically unsound and practically limited by land area and nutrient requirements, concluding that emissions from both sources must be addressed in parallel rather than through offsetting.

Carbon Market Watch argues that the FTC's 'Green Guides' are outdated and fail to align with the Paris Agreement's 1.5C goal. The submission recommends a total ban on claims such as 'carbon neutral' and 'net zero' because they falsely imply that emissions can be 'neutralised' through carbon credits, which the author describes as scientifically unsound. Instead, the document proposes a 'contribution' model where companies fund mitigation projects without claiming to offset their own emissions. It also suggests that the Guides be made enforceable under the FTC Act to provide oversight of the voluntary carbon market and protect consumers from greenwashing.

The document argues that the Clean Development Mechanism (CDM) should be ended by 2020 because it undermines domestic climate action, increases global greenhouse gas emissions through 'junk' credits, and violates human rights. It specifically urges UNFCCC Heads of Delegation and the ICAO Council to stop allowing CDM credits to be used for Nationally Determined Contributions (NDCs) and aviation emissions targets.

Carbon Market Watch argues that Gold Standard's proposed methodology for crediting the early retirement of coal plants lacks the necessary rigor to ensure additionality and environmental integrity. The organization expresses skepticism that carbon credit finance is a suitable tool for this purpose given the volatility of energy markets and the difficulty of accurately measuring the future viability of coal plants. Specific concerns include the risk of double claiming, vague definitions of 'baseline plants' that might include economically unviable facilities, and the failure to account for the lifecycle emissions of new renewable energy plants.

Carbon Market Watch criticizes the proposed Green Claims Directive (GCD) for allowing the continued use of carbon neutrality and offsetting claims, which the organization asserts are inherently misleading due to quantification uncertainties, low carbon credit quality, and consumer misunderstanding. The response argues that the GCD's substantiation rules are too weak to prevent greenwashing and that the directive lacks clear definitions for 'significant' environmental impacts and specific requirements for future performance claims.

The policy brief warns that the Kyoto Protocol's market mechanisms created an 11 gigatonne 'hot air' loophole due to inflated greenhouse gas estimates, particularly in Eastern European countries. It argues that allowing the carry-over of these credits or early action credits into the post-2020 Paris agreement would undermine climate goals and fail to drive real mitigation. The author recommends that eligibility for market mechanisms be restricted to parties with ambitious, quantified carbon budgets and that early action in developing countries be supported through new climate finance rather than credits.