IETA COP24 Report
KATOWICE, 9 December - Greetings from Katowice!
Following our daily update on Friday, we’d like to delve a little deeper into some of the key issues in the Article 6 negotiations that we’re following.
You may have read that the SBSTA plenary on Saturday failed to agree on whether to “welcome” or simply `'take note of`' the IPCC 1.5 degree report. SBSTA Chair Paul Watkinson said that he would inform the COP President about the impasse. At present, the question will be automatically added to the Agenda for next year's COP as specified under Rule 16. We expect this issue will be revisited in the final plenary, rather like the fraught moments in Paris when “should” and “shall” caused so much trouble.
At the same time, Article 6 negotiations grew more problematic in the last day. The draft text became heavily bracketed, the UN technique for reflecting that issues are still undecided. In fact, the entire Article is in brackets - with many issues and alternatives appearing in more brackets. Efforts in SBSTA to bridge differences got bogged down. The Chair's goal was to get consensus on technical issues, so that the larger political issues could be given to ministers to decide. But we’re not at that stage yet.
Article 6 negotiators at the end of SBSTA talks
SBSTA talks came to an end on Saturday, when the various Paris Rulebook work streams submitted the outcomes of their first week's work to the COP plenary.
The COP Presidency decided that more time is needed to try to unlock agreement on technical matters, including Article 6 issues. He asked Parties to continue the technical work until Tuesday night. At that point another stocktaking meeting will be held, and whatever issues remain unresolved will be forwarded to ministers.
We understand that when the text is brought to ministerial level, two ministers will be assigned to each open topic. They’ll be tasked with bringing matters to a successful resolution.
Over the last 24 hours, our policy team has been dissecting the draft Article 6 text and looking for potential “landing zones” where compromise and agreement may be possible. The situation is still very fluid, and there are still many moving pieces.
The first element we’re watching is the definition of an Internationally Transferable Mitigation Outcome (ITMO) in Article 6.2. We’re keen for it to represent tonnes of CO2 equivalent, but some Parties are pressing for other metrics to be recognised as well.
Our view is that we should start with tCO2e in the Rulebook, and then Parties can consider whether to expand the definition as part of the work programme on technical elements. We’d also like CO2 removals to be explicitly referenced in the definition.
There are also different views on how to account for carbon reductions and transfers. Parties are still struggling over whether to require corresponding adjustments if reductions are made from sectors outside a country’s NDC. Equally, there is disagreement over whether ITMOs can be used for purposes other than meeting an NDC. This provision aims to provide an implicit recognition that programmes such as CORSIA could also have access to ITMOs.
There are competing options when it comes to the composition and membership of anew supervisory body for the Article 6.4 mechanism, while there is also disagreement over whether Article 6.2 also needs a supervisory body to oversee the reporting and review of ITMO transfers.
IETA’s view is that there is no need for an Article 6.2 supervisory body. Reporting on use of ITMOs by Parties should be evaluated as part of the reviews by technical expert teams and reported to the COP as the overarching governing body. We do, however, think that this is the time to constitute the Supervisory Body to run the Article 6.4 mechanisms.
The issue of Overall Mitigation of Global Emissions (OMGE) is pitting the Small Island States against many other Parties. AOSIS is pushing very hard for transfers of ITMOs under both Articles 6.2 and 6.4 to undergo a “haircut” in which a portion of the ITMOs would be cancelled or discounted. This would come on top of the proposed Share of Proceeds and the use of conservative baselines.
IETA’s view is that the overall mitigation was not intended to apply to Article 6.2. We think that for Article 6.4, overall mitigation can be satisfactorily achieved through use of conservative baselines and standardised performance crediting benchmarks. We think that an additional “haircut” is not justified.
AOSIS and the African Group are also pressing very hard for a Share of Proceedsto feed adaptation funding.
Finally, the transition of the CDM is being dominated by discussions over eligibility criteria for the Article 6.4 mechanism. There is a proposal rumoured to be in the works to set a “cut-off” date for projects based on when they are registered in the CDM.
Older projects would be more likely to have passed through their first crediting period, while more recently registered projects may have crediting periods that extend well into the 2020s. They could have a greater claim to be accommodated by the new mechanism, although they would need to requalify for additional crediting periods.
On this issue, among many others, there are still too many options on the table at this stage. We’d like to see the options narrowed down before ministers have their say on the final outcomes.
Equally, we are keeping a watching brief on how the evolution of Article 6 intersects with REDD+, with finance, reporting and technology.
We will continue to track these negotiations and will update you in our next Report tomorrow.