Day 4: November 12
Greetings form Antalya and COP31!
The High-Level segment of this year's summit wrapped up and negotiators were left to get on with their work, while delegates in the pavilions hit their daily steps targets and crowded the walkways. It's a noisy, bustling COP despite the gloom all around, and one very strong impression we're taking from the week so far is how much more attention there is on carbon markets.
Good coffee isn't something you have to worry about in Türkiye, so our research into the best coffee here has proved pretty redundant. As expected, the line outside Australia's coffee bar is enormous, but there are tasty cups to be found at almost every big pavilion, so it's not much of a contest this year.
The "top-level" negotiations over the main agenda items are divided between those issues that have established spots on the agenda, and those that are being parachuted into the so-called "cover decision" text.
On the agenda, there's an annual Global Stocktake dialogue that's focusing on helping Parties with policy direction and implementation of their NDCs; the Sharm el-Sheikh Mitigation Work Programme which aims to bridge the emissions gap to 2030; several tracks on finance, adaptation, and loss ad damage. We're not expecting any breakthroughs in these areas as they are part of ongoing processes.
Regarding a cover decision, observers reported that elements of a draft text may include a recognition that the overshoot in global temperature increases is currently heading for 1.7 degrees Celsius. This was underscored by the President of Negotiations Chris Bowen in the opening plenary.
The observers warned that to turn the increase back to 1.5 degrees will require deeper cuts, a greater focus on removals as well as net negative emissions sources, and more effort on adaptation and resilience, as well as the already-trailed pledges on electrification and methane reductions. These elements may also turn up in the final cover text.
And after the introduction of the fossil fuel transition made a splash as a key issue at last year's COP, there is some surprise that, even though Brazil launched its Transition roadmaps this week, there is so far not much discussion of a fossil fuel transition in the cover text debate.
Away from the headline issues, there was plenty to interest carbon market stakeholders. The Coalition to Grow Carbon Markets published its long-awaited Policy Playbook to Grow Demand for High-Integrity Carbon Credits, which sets out policy levers that governments can employ to support sustainable, long-term demand for high-integrity carbon credits.
At the same time 14 member governments of the Coalition issued an Antalya Statement in support of the Playbook. Carbon credit markets “play an important role in directing capital to climate action and climate-positive growth,” the Coalition said. “What matters now is implementation.”
Earlier this week, UNCTAD launched an initiative aimed at channelling more carbon market investment towards climate projects, particularly in developing countries.
"Carbon pricing is expanding, but fragmented markets, inconsistent standards and concerns over credit quality are limiting the potential to mobilise finance," the organisation said. UNCTAD will form a network of market actors to improve transparency, strengthen trust and facilitate cross-border transactions.
Beyond the walls of COP, the UK government today published its response to a public consultation on voluntary carbon credits, which emphasised the role that high-quality and high-integrity credits can play, and gratifyingly also acknowledged IETA's work on "safe harbour" regulations.
Lastly, our Council chair Mary Grady, together with CEO chief Dirk Forrister, met with representatives of Brazil's state-owned bank Caixa, who formally signed an expression of interest in joining IETA.
In the negotiations
Negotiations over the Article 6.2 funding item resumed on Thursday. Today was the last session to be held under the auspices of the Subsidiary Body for implementation, and talks will continue under the Conference of the Parties' Paris Agreement track next week.
Our team reports that delegates are still far from an agreement. The key variables are:
- whether funds are to come from the core UNFCCC budget or from user fees;
- whether user fees would be only for registry services (which Parties may or may not use) or whether they would also cover core 6.2 functions such as reviews;
- whether fee waivers would apply to least developed countries and small island developing states only, or to all developing countries. We assume that developed countries would be defined as Annex I and if this goes through, it would be a very unusual reintroduction of a Kyoto-era classification under Paris.
The session closed with what our observers called a "slightly theatrical intervention" by Switzerland, in response to a previous intervention by The Gambia which proposed to charge fees on “authorised entities” rather than Parties. Switzerland pointed out that to charge "authorised entities" risked requiring the UNFCCC to charge hundreds or even thousands of entities.
We were disappointed by an Article 6.4 capacity building event this evening, at which no private sector representative was invited to speak. Nonetheless, Molly Brown from BURN took the floor during the Q&A and made a terrific case for supporting methodologies that would allow African projects to be financed, rather than stacking layers of conservative guidelines for their own sake.
And while we know that Article 6.4/Paris Agreement Crediting Mechanism discussions are limited to considering the annual report from the Supervisory Body, our team gets the impression that host countries are starting to realise what the implications of strict PACM methodologies are for project financing. The discussions under this agenda item next week under the CMA could become interesting...
Today at COP31
IETA's team were in action and in the audience at a number of pavilions and event on Thursday.
Agustina Cundari joined the Government of Nepal, EPC Nepal and Value Network Ventures to discuss how Nepal can turn Article 6 readiness into real investment. Key takeaways:
- Cooperative approaches under Article 6.2 can mobilise finance for mitigation, but adaptation needs to be mainstreamed across activities. For climate-vulnerable countries like Nepal, the goal is projects that strengthen resilience, continue over time, scale up and deliver lasting benefits for local communities.
- Private sector participation and public-private partnerships are most valuable at the early stages of implementation. That is when frameworks, project pipelines and investment structures are being shaped.
- The aviation sector’s CORSIA market is one of the largest near-term sources of demand for authorised units. Host-country governments should factor it into their Article 6 strategies and authorisation processes.
- Clear, stable rules and processes give investors confidence in the country, which is what unlocks project finance. Strengthening local actors is equally important, so that strong partnerships can be built on the ground.
Nadine Lim participated in a round-table at the Singapore Pavilion, where she gave an update on 6.2 progress and the growing importance of registries and reporting. Views were shared between independent crediting programmes and potential A6 supply countries. Participants also exchanged experiences and challenges in operating registries.
Jeremy Rubin joined a CDR 2030 panel at the IETA pavilion. Utilising the "t-shirt concept", which is a portfolio of CDR pathways across types, speakers showcased how they can work together given the need for scaling CDR, diversification and cost containment.
Jeremy followed up by participating in a session examining which policies, conditions, and tools will be necessary for decarbonisation of industry. Representatives from Turkiye, JSW and Heidelberg also made remarks along with several others. There was a focus on carbon pricing, demand for low carbon products, with implications for trade. Industrial competitiveness hand in hand with decarbonisation.
We were also excited to host an event for U.S. sub-national officials to remind us all that while the federal government may be swerving COP, states are still following through on their climate commitments.
- Amanda Lefton, commissioner at the New York state Department of Environmental Conservation, discussed the completion of the RGGI model rule program review while addressing affordability and climate. She also made our comms team very happy by ending her remarks with IETA's new tagline: "Markets work. Carbon markets matter!"
- Serena Mcllwain, Secretary at the Maryland Department of the Environment, talked about the benefits of RGGI for the state in mitigation, but also about how the state is reinvesting revenues from the cap-and-trade market into residents and clean tech like heat pumps and solar.
Earlier in the day we also had the chance to welcome California governor Gavin Newsom and state Air Resources Board chair Lauren Sanchez to the IETA Business Hub.
Tomorrow at COP31
All event times are listed in Antalya time (TST), which is three hours ahead of GMT and five hours behind Singapore time.
The IETA Business Pavilion is located in Delegation Pavilion Area B2, on stand C525. Our Boardroom is in the Delegation Office Area C3, room DO-17.
Friday is Finance and Trade Day at COP31; unofficially it's also being recognised as Carbon Markets Day, and it's going to be really busy.
Around the COP venue (and off-site as well), there are a host of market-related events taking place tomorrow:
- Making Article 6 work for the private sector: from sovereign demand signals to market reality (0800 TST, Casa Sur, Old Town Antalya - organised by VCMI and First Climate);
- Carbon Markets at COP: mapping the landscape and aligning international initiatives (0800 TST, EY Hub at the Divan Talya Hotel, Antalya);
- SAF Panel – accelerating sustainable aviation fuel uptake in Asia Pacific (0945 TST, Singapore Pavilion);
- Green trade corridors and carbon market mechanisms (1000 TST, Global Biofuels Alliance Pavilion);
- Informal interactive dialogue on Article 6 technical expert review (1000 TST, Meeting Room 19 and online at UNFCCC website);
- IETA/CNI EVENT: Connected carbon markets: Article 6, CORSIA and the challenges of interoperability (1015 TST, Brazil Pavilion; Belem Auditorium);
- Policy signals businesses need to unlock demand for carbon credits (1330 TST, Business Pavilion, Zone B2, Pavilion: C-555);
- Open Coalition on Compliance Carbon Markets (1600 TST, Special event room 3);
- Beyond Ambition: Making the Case for Carbon Removal Today (1600 TST, WWF/IUCN Pavilion);
- Harmonising carbon accounting to enable industrial decarbonisation: international cooperation in a diversifying policy landscape (1630 TST, Brazil Pavilion; Belem Auditorium);
- How can CCS help in addressing the requirements of CBAM initiatives, including for Turkiye (1830 TST, Side Event Room 6 - KATİP ÇELEBİ), and
- From Design to Delivery: What’s Next for the Paris Agreement Crediting Mechanism (1900 TST.
At the IETA Business Hub, we'll be hosting sessions on AI, carbon management, Africa and Article 6.4:
- CCS and Decarbonising AI Data Centres (1030 TST, IETA Business Hub);
- Financing Carbon Management Projects to Support Net-Zero Targets (1115 TST, IETA Business Hub);
- Africa Climate Implementation Summit (1200 TST, IETA Business Hub);
- Africa Climate Deal Room & Project Showcase (1330 TST, IETA Business Hub);
- Lagos Climate Investment Day (1430 TST, IETA Business Hub);
- Methodologies we can depend on – now and for the future (1600 TST, IETA Business Hub), and
- Harnessing the Article 6.4 pipeline for sovereign compliance buyers (1700 TST, IETA Business Hub).