The 29th Conference of the Parties to the United Nations Framework Convention on Climate Change (UNFCCC), known as COP29, adopted decisions on the implementation of Article 6 of the Paris Agreement. After almost a decade of negotiations, COP29 laid the foundations for an effective global carbon market that includes all Parties to the Paris Agreement and mandated the technical body responsible for Article 6.4 to effectively implement these standards. It also enhanced the mechanisms under Article 6.2, which will now be monitored by the UNFCCC Secretariat.

The COP29 conference took place from 11 to 22 November in Baku, Azerbaijan, and focused on multilateral negotiations on the mechanisms defined in Article 6 of the Paris Agreement. These mechanisms include: (i) a centralized market under Article 6.4 for trading emission reduction credits (A6.4ERs), to be managed by a designated supervisory authority; and (ii) Internationally Transferred Mitigation Outcomes (ITMOs) under Article 6.2, which will enable countries to achieve climate goals through bilateral or multilateral agreements.

Key results

Article 6.4 of the Paris Agreement

A new framework for Article 6.4 was adopted at COP29, building on the previous standards of the Supervisory Authority and introducing stricter requirements for the removal of emissions and the methodology for their reduction or removal. The Supervisory Authority is now tasked with further developing and implementing these standards.

The adopted guidelines include:

1. Monitoring and reporting requirements that must be based on robust and conservative measurements and supported by thorough reporting.

2. Post-loan monitoring, which is required after the end of each loan period.

3. Accounting for reductions through net change in greenhouse gas storage and emissions.

4. Assessment of the risk of reversal, based on which participants must have a risk mitigation plan in place.

5. Quick cancellation notification in case of any changes.

6. Establishment of a reversal risk reserve account.

Social and environmental safeguards and the rights of indigenous peoples are also taken into account.

Article 6.2 of the Paris Agreement

The conference also clarified authorization, which covers cooperative approaches, ITMOs and participating entities, and introduced a new framework for transparency and disclosure of information on approved ITMOs. The UNFCCC Secretariat is responsible for monitoring compliance with the statutes, although sanctions for non-compliance are not yet established.

Next steps

The COP29 decisions strengthen the functioning of the mechanisms under Articles 6.2 and 6.4, while the main technical work on their implementation is still ongoing. The responsibility now lies with the Supervisory Body and the UNFCCC Secretariat to ensure the proper implementation and monitoring of these standards. Further discussions are expected, which could take place during future meetings of the subsidiary bodies and the UNFCCC conference in 2025. Spring