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  • 02 Dec 2019 10:09 AM | Anonymous member (Administrator)

    MADRID, 2 December - The business community today calls on nations to agree a “simple but rigorous” set of rules governing international emissions trading at COP25, which starts today in Madrid.

    IETA has followed up this call by publishing a paper that sets out the benefits of international emissions trading under Article 6 of the Paris Agreement. The report is supported by no fewer than 15 international and national business, industry and climate associations.

    The paper urges delegates to COP25 to “deliver a simple but rigorous rule book for Article 6… based on transparent numerical accounting, [that] recognises both natural and industrial sinks and supports and encourages large scale transactions.”

    Dirk Forrister, President and CEO of IETA said that, just as trade among nations secures access to goods and services that may not be available domestically, so emissions trading secures access to greenhouse gas reductions that may not be achievable at home at the lowest price or the fastest rate.

    “Not all countries can reduce emissions at the same rate, and… it is certainly not the case that every country can be at zero emissions when needed, so we could use trade to collectively get there through Article 6,” Forrister said.

    Cooperation through Article 6 has the potential to reduce the total cost of implementing NDCs significantly, in the order of $320 billion/year in 2030, or alternatively facilitate removal of more emissions, in the order of 9 GtCO2/year in 2030, at no additional cost if those cost savings are reinvested into additional mitigation.

    And as the world approaches net zero emissions in the middle of this century, trading will become even more important, the paper pointed out.

    “The task of achieving [net zero emissions] can be facilitated by matching sources and sinks through a cooperative approach based on trade” Stefano De Clara, IETA’s head of international policy said.

    “COP25 must deliver a simple but rigorous rule book for Article 6, which is based on transparent numerical accounting, recognizes both natural and industrial sinks and supports and encourages large scale transactions”.  

    However, if countries and sectors cannot agree a wide-ranging trading system for emissions reductions, net zero emissions is unlikely to be achieved in time, the report concludes.

    “Article 6 rules are essential for enabling countries to deliver on the Paris goals,” said Dirk Forrister, President and CEO OF IETA. “That’s why business sees it as the missing link to making its visionary goals achievable.”

  • 22 Nov 2019 10:55 PM | Anonymous member (Administrator)

    Bogota, 22 November – IETA and the Association of Colombian Carbon Market Participants (Asocarbono) today signed a memorandum of understanding to explore ways to work together to strengthen business capacity for the expanding carbon market in Colombia.

    The agreement, signed during Asocarbono’s first annual congress in Bogota, initiates a new program of cooperation between the two business groups, leveraging IETA’s extensive experience in markets around the world and Asocarbono’s deep engagement in the Colombian carbon tax and offset market.  

    The MoU was signed by Dirk Forrister on behalf of IETA, and by Francisco Ocampo, executive director of Asocarbono.

    In Forrister’s keynote remarks to the Asocarbono Congress, he noted the growth in interest in using Article 6 of the Paris Agreement. Article 6 will support nations who choose to work together to generate emission reductions that can be transferred internationally, ensuring that investment in carbon abatement can capture lowest-cost reductions around the world. 

    He noted that the upcoming COP 25 negotiations in Madrid aim to complete guidelines on Article 6 – and then IETA plans to work with more countries on how to use cooperative market approaches that attract private investment at scale.

    “IETA is delighted to be working with Asocarbono, which represents one of the most dynamic carbon market environments in Latin America,” said Dirk Forrister, CEO of IETA. “Colombia is driving regional ambition through its carbon tax and offset policy, and we are happy to support the government and private sector actors in achieving their goals and potentially in expanding to a broader emissions trading market in the future.”

  • 07 Nov 2019 6:56 PM | Anonymous member (Administrator)

    LONDON, 7 November -  Nations will meet next month in Madrid for two weeks of negotiations over completing the rules to operationalise the Paris Agreement. 

    The crucial goal at this year’s summit is to conclude more than three years of talks over the details of Article 6 of the Agreement, according to IETA’s CEO Dirk Forrister.

    “Article 6 is vital to the success of the Paris Agreement,” Forrister said. “The ambition set out in the agreement absolutely requires the participation of the private sector, and Article 6 is the key to that participation.”

    Recently published research found that cooperation through Article 6 has the potential to reduce the total cost of implementing NDCs significantly, in the order of $320 billion/year in 2030, or alternatively facilitate removal of more emissions, in the order of 9 GtCO2/year in 2030, at no additional cost if the cost savings are reinvested into additional mitigation. 

    Article 6 deals with the international trade and exchange of emissions reductions among member states, allowing countries to achieve abatement at lowest cost. Within the Article are two main market tools: Article 6.2, which sets down definitions of internationally transferable emissions reductions, the rules for accounting and reporting; and Article 6.4 which sets out a crediting mechanism for emissions reduction and sustainable development.

    IETA has laid out its detailed priorities for Article 6 in a document which can be found here

    “Nations and companies have expressed the intention to use the power of markets to help achieve Nationally Determined Contributions to the Paris Agreement,” said Stefano De Clara, IETA’s Director of International Policy. “COP25 must give clarity on key elements essential to bring Article 6 to life and should set up a detailed work programme to advance the work on technical elements. 

    IETA’s priorities for COP25 are laid out in a document that can be found here.


  • 04 Nov 2019 11:20 PM | Anonymous member (Administrator)

    WASHINGTON, DC, 4 November – The United States government’s move today to begin its formal withdrawal from the Paris Agreement is disappointing, but the 2015 international deal will survive, IETA says.

    The US government today announced that it had notified the UN of its intent to withdraw from the Paris Agreement. Under the terms of Article 28 of the agreement, today – the third anniversary of its entry into force – is the earliest that such a notification could be issued and will take effect in one year. This follows US President Donald Trump’s statement in June 2017 that the country would withdraw from the deal as soon as practically possible.

    “Today’s announcement that the US has begun the formal process of quitting the Paris Agreement is disappointing, while not unexpected,” says IETA President and CEO Dirk Forrister. “IETA remains confident that other nations will uphold their pledges, and we are encouraged by last week’s ministerial statement from the BASIC grouping1 reaffirming their commitment to the Paris Agreement.”

    He adds: “There is a wealth of action happening in states and cities across the US to shift to a low-carbon economy, and we continue to see voluntary commitments and innovation from the private sector – all recognising that the climate change challenge is the fight of our lifetimes. IETA will continue to engage with all of these actors and help them leverage their innovations and can-do attitude to transform the world into the future we all want.”


    1 Full statement sourced via the Government of India Press Information Bureau on 5 November 2019.

  • 24 Oct 2019 11:21 PM | Anonymous member (Administrator)

    SAN FRANCISCO, 24 OCTOBER - The International Emissions Trading Association (IETA) today issued the following statement in response to the civil lawsuit filed by the US Department of Justice against the State of California regarding the linkage of its cap-and-trade program with another cap-and-trade program in the Canadian Province of Québec. 


    This lawsuit represents the continuation of an unfortunate political battle waged by the Trump Administration against California’s climate leadership. The legal challenge seeks to disrupt a market-based climate program that has enabled companies in California and Québec to achieve their targets at lower cost. 

    The attempt to terminate the link between California and Québec causes unnecessary market uncertainty by changing legitimate expectations of companies that invested in emissions reduction projects in the two jurisdictions. The program has operated since 2014 without federal interference.

    “IETA supports both the California and Québec cap-and-trade programs as well as the linkage between them that allows businesses to achieve carbon reductions at the lowest economic cost,” said Dirk Forrister, President and CEO of IETA. “This program has grown stable with laws that extended the targets to 2030, and many companies have invested in reliance on that legal framework.”

    IETA’s long-standing preference is for the U.S. federal government to adopt a national emissions trading program to provide a clear and effective policy framework for American businesses. In the absence of federal policy, IETA has applauded California and other states as they pioneered carbon market solutions to pave the way for a national policy in the years to come.

    To create the linkage between the two markets, regulators in California and Québec signed a Memorandum of Understanding (MOU) rather than a treaty (which could have been in violation of the United States Constitution). This MOU followed a common practice in the modern world of MOUs between subnational jurisdictions in many areas of commerce. 

    “The global economy and the interconnectedness of the environment has led to multilayered federalism: many states are parties to agreements with other subnational jurisdictions, and most of them were not approved in advance by Congress,” said Nico van Aelstyn, Partner at Sheppard Mullin LLP, who has acted on IETA’s behalf in prior litigation in California.  

    The Department of Justice lawsuit focuses on the linkage between the California and Québec cap-and-trade programs. Even if the lawsuit succeeds in severing the linkage between the two programs each would nonetheless continue normal operations without benefits of cooperation. The Trump Administration’s complaint could force a loss of market-based efficiencies, potentially increasing the overall costs of carbon emissions across the two jurisdictions. 

    “The climate challenge demands more market-driven cooperation across national borders, not less,” said Katie Sullivan, Managing Director of IETA. “The WCI’s cooperative approach is a proven winner in providing incentives for businesses to cut emissions while keeping costs down for consumers, giving the U.S. an extra climate benefit – not a harm.”

  • 24 Sep 2019 3:09 PM | Anonymous member (Administrator)

    NEW YORK, 24 September - International cooperation under a well-functioning Article 6 of the Paris Agreement could save as much as $250 billion per year by 2030, according to a new study. Experts believe that the savings could improve the likelihood of achieving the Paris climate protection goals.

    The study was carried out by the International Emissions Trading Association and co-sponsored by Carbon Pricing Leadership Coalition,with the help of researchers and modellers from the University of Maryland. You can find a copy of the summary report here, and a copy of the full document here.

    Reinvesting these savings in further emissions reductions could increase the potential for overall global reduction in greenhouse gases by around 5 billion tonnes a year in 2030, the study found, helping to close the ambition gap. Existing national commitments are currently estimated to achieve 9 billion tonnes in that timeframe, so Article 6 cooperation could enhance it by over 50%.

    When coupled with natural climate solutions in lands and forests, the benefits become even greater – making an additional 9 billion tonnes of abatement feasible and doubling the effectiveness of the Paris Climate Agreement.

    In the search for greater climate ambition, market cooperation and natural climate solutions are essential elements,” said Dirk Forrister, CEO of IETA. “The modelling shows how expensive ambitious targets can become if countries act in isolation – but if they work together to drive global market incentives and tap nature’s potential, the Paris goals come within reach.”

    However, these astonishing outcomes rely on the adoption of a clear and transparent set of rules for international emissions trading, on one side, and on the inclusion of the use of Article 6 in countries’ Nationally Determined Contributions (NDCs) on the other.

    “When international negotiators gather in Santiago, Chile in December, the top issue for decision this year is completion of the Article 6 rulebook,” said Cristobal De la Maza, Head of the Environment and Climate Division at the Ministry of Energy of Chile. 

    “This report shows the importance of getting it done well, so that countries can start working together more effectively and build confidence for raising ambitions.”

    Nat Keohane, vice president for international climate at the Environmental Defense Fund, said: “These results, which are in line with independent analysis by EDF, show that international cooperation, including natural climate solutions, is critical to raising ambition."

    "To cut emissions at the pace and scale that the science demands, we must harness the most powerful force we have — the power of markets. Countries can take an important step forward at COP25 in Santiago by agreeing on strong guidance under Article 6 of the Paris Agreement.”

    Article 6 will guide the transfer and trade in emission reductions among nations, which will ultimately involve the private sector. At COP25 in Chile later this year, negotiators from more than 190 countries will be tasked with agreeing a set of rules to account for the trade in emissions reductions and to establish a UN body to govern a new Sustainable Development Mechanism for assessing and issuing carbon credits. 

    “A decision to operationalise Article 6 is crucial for a sustained, robust implementation of the Paris Agreement,” said Juan Pedro Searle, Article 6 Cluster Coordinator, Chilean negotiating team. 

    “Negotiators from every country and groups will have a unique opportunity at COP25 to leave a legacy to humankind: the adoption of the rules that will promote an unprecedented cooperation between parties in the fight against climate change. The invitation is open to make COP25 a successful event.”

    Additional Background

    Under the Paris Agreement, each nation has prepared a plan or NDC towards the overall goal of net zero carbon emissions by the second half of the century. The IETA/UMD modelling extrapolated current NDCs to the end of the century and ran them through four scenarios to estimate the total monetary value of Article 6 of the Paris Agreement.

    If countries act in isolation, the models show a wide range of market prices emerging by 2030, from $0 in poor countries to $101 in Europe. But with effective market linkages, prices converge to a global average of $38 in 2030 whilst delivering the same level of climate protection.

    “Net zero emissions means that trade must bring together natural and technological sinks with the remaining emitting sources, wherever they may be,” said said Stefano De Clara, IETA’s International Policy Director. “This can only be achieved if large scale trading systems emerge, and they must follow robust rules of transparency to instil business and public confidence.”

    The calculations show that international cooperation through Article 6 could yield cost savings in the order of $249 billion per year by 2030, $345 billion per year by 2050 and $988 billion per year by 2100. These costs represent significant savings compared with a scenario in which nations do not cooperate on trading: costs are more than 60% lower in 2030, around 40% lower in 2050 and around 30% lower in 2100, the study found.

    This in turn generated values for the global carbon market of about $167 billion in 2030, $347 billion in 2050, and $1.2 trillion in 2100. Even more importantly, the results show that all countries benefit, in terms of GDP growth, from Article 6 cooperation.

    “This study illustrates how cooperation through carbon markets benefits all parties who join in,” said Angela Churie Kallhauge, Head of the CPLC. “It drives investment to those who have potential to reduce emissions more cost effectively than others.”

    Interestingly, results show that developing effective policies to tap the land use sector's potential could further increase the economic and mitigation value of Article 6, increasing savings to $320 billion a year, and additional mitigation to 9 billion tonnes a year, in 2030. This clearly underlines the importance of Natural Climate Solutions coupled with an effective framework for international carbon markets.

    “The cumulative additional mitigation enabled by perfect implementation of Article 6 over the course of the century exceeds 520 billion tonnes of CO2. [Reinvesting the savings into additional mitigation] enables 50 percent more mitigation compared to [the baseline scenario],” the report states.

    “Our goal is to move this project forward to produce further results before COP25 and to continue the research effort in 2020,” said IETA’s Forrister. “There is a clear need for scientific research to examine potential implications of alternative rulesets and implementation pathways for Article 6”.

    “Understanding the value of international cooperation under the Paris Agreement through Article 6 is extremely important to enable us to make a strong business case for stakeholders to prepare and engage in the development of international markets,” said the CPLC’s Kallhauge. “Such cooperation is important if we are to address concerns around competitiveness and the loss of productivity.”

    IETA would like to acknowledge the following organisations for their support for the Article 6 modelling project: the Carbon Pricing Leadership Coalition, the University of Maryland, Chevron Corp., Conservation International, the Electric Power Research Institute (EPRI), the European Bank for Reconstruction and Development (EBRD), the Governments of Germany, Norway and the United Kingdom, the Institute for Global Environmental Strategies, Royal Dutch Shell plc and the Swedish Energy Agency.

  • 06 Aug 2019 1:31 PM | Anonymous member (Administrator)

    GENEVA, 6 August - IETA is pleased to announce the appointment of Federico Di Credico of ACT and Hendrik Rosenthal of CLP as new members of its governing Council. They fill vacancies created when Matthew Bateson of Rio Tinto and Jeanne Ng of CLP resigned in mid-term.

    Federico Di Credico is Managing Director of ACT Financial Solutions, an investment firm spin-off of ACT Commodities Group, which specialises in carbon emission trading, price risk management and climate finance. He joined ACT in 2012, after working as renewable energy analyst in Italy and as derivatives broker in London. In 2017 he was appointed to manage the newly established investment firm, ACT Financial Solutions, based in Amsterdam. Federico’s main area of focus and expertise lies in market-based mechanisms, risk management and financing instruments that can help drive the economy towards a sustainable future.

    Hendrik Rosenthal is Director - Group Sustainability of the CLP Group and is responsible for the Group’s sustainability-related strategy, reporting and communications. Based in Hong Kong, he supports CLP senior management in sustainability and climate change-related risk management and advises on sustainability matters of the Group’s power business in the Asia-Pacific region. With 20 years of experience in environmental management across the public, private and NGO sectors, Hendrik previously led research and consulting projects in Canada, Hong Kong and Singapore.

    “I am happy to welcome Federico and Hendrik to the IETA Council at a time when carbon markets are growing more vibrant, in light of the momentum behind the Paris Agreement,” said Rick Saines, Chairman of the IETA Council. “Each of them brings enthusiasm and fresh ideas to the leadership of our organisation.”

    “Hendrik’s insights from working for a covered entity in the Chinese carbon market pilots and Federico’s trading desk experience across multiple carbon and clean energy markets will bring valuable perspective to the IETA Council’s work,” said Dirk Forrister, IETA President and CEO.  

  • 08 Jul 2019 6:32 AM | Anonymous member (Administrator)

    IETA urges EU Members States that are introducing coal phase-out policies to cancel EU ETS allowances to protect the bloc’s carbon market from a supply-demand imbalance. 

    A large-scale shutdown of coal-fired generation, happening simultaneously in several EU countries, would significantly affect the functioning of the EU’s carbon market by cutting demand for EU allowances (EUAs). So far, national coal phase-outs are planned in 12 Member States. 

    The review of the EU ETS Directive for Phase IV (2021-2030) introduced the option for Member States to voluntarily cancel emission allowances corresponding to national measures that lead to closure of electricity generation capacity in their territory. Further guidance on this provision is expected to be provided by the European Commission in the review of the Auctioning Regulation. IETA encourages the European Commission to clarify rules soon on the voluntary cancellation of allowances. 

    IETA has today published a position paper entitled “Ensuring the EU’s carbon market resilience to national coal phase-out policies” that outlines recommendations on how to tackle the risk that market demand could collapse, resulting in oversupply.

    “Currently the MSR can only partially mitigate the impact of numerous coal phase-outs happening simultaneously. We believe that cancellation of allowances by Member States is the right solution to ensure the EU’s carbon market’s resilience to national coal exits.” said Julia Michalak, EU Policy Director at IETA.

    “There are still many unanswered questions with regard to the cancellation provision, including the calculation for the number of allowances to be cancelled, advance notification of cancellations, and a template for Member States to inform the Commission of their intention to cancel EUAs. All these relevant details should be clarified swiftly.”

  • 28 Jun 2019 9:58 AM | Anonymous member (Administrator)

    IETA welcomes the decision today by UNFCCC negotiators in Bonn to send to this year’s Conference of the Parties (COP) a set of updated draft rules to operationalise Article 6 of the Paris Agreement.

    The draft rules will be discussed by nations at the COP25 meeting in Santiago, Chile, in December.

    IETA urges negotiators to ensure that the rules are fully fleshed out for approval at the annual climate summit, to give the global business community sufficient time to prepare before the rules to take effect.

    “The COP has already acknowledged that in addition to public funding, nations must leverage vast sums of money from the private sector to help reach the goals of the Paris Agreement,” said Dirk Forrister, IETA’s CEO. “A complete set of Article 6 rules are critical to create the transparency and security that these funds need in order to flow.”

    Article 6 of the Paris Agreement lays out the framework for international market mechanisms that would help countries achieve deep reductions in emissions from 2020, with the goal of achieving global net zero emissions in the second half of this century.

    The text under discussion covers issues including the legal basis for emissions reductions, accounting for transfers of emissions reductions, rules for project-based reductions and non-market-based approaches.

    “It’s good to see that Parties have made progress beyond the Katowice texts,” said Stefano De Clara, International Policy Director at IETA. “We’re hopeful that this draft will constitute a good basis for continuing the work in Santiago.”

    At last year’s COP in Katowice, Poland UNFCCC delegates failed to reach agreement on rules for international carbon markets, despite the efforts of the Polish presidency to create a streamlined set of draft decisions.

    Over the past two weeks in Bonn, negotiators have focused on ensuring the draft rules reflect all positions.

    “We expected to see largely technical work aimed at addressing the ambiguities in the two sets of draft texts that emerged from Katowice,” De Clara said. 

    “Fundamental issues remain to be decided,” he added. “The work of this session was not to complete work on those issues, but to produce a technical text that can now be forwarded to the political decision process at COP25.”

    Parties will meet in Santiago from 2-13 December to negotiate and approve the draft text.

  • 17 Jun 2019 7:00 AM | Anonymous member (Administrator)

    PARIS and GENEVA, 17 June - Delegates from more than 190 countries meet in Bonn this week to continue negotiations over the implementation of Article 6 of the Paris Agreement.

    Article 6 provides a policy foundation for trading in emissions reductions between states, a critical element for business in the drive to achieve net zero emissions by the second half of the century.

    Parties were unable to find agreement on Article 6 at COP24, resulting in the absence of its rules from the Katowice Climate Package. Instead, they forwarded negotiating texts to Bonn that will serve as a starting point for discussions this week, led by Paul Watkinson (France), Chair of the UNFCCC’s Subsidiary Body for Science and Technical Advice (SBSTA).

    “We believe the business community’s ability to deliver ambitious targets with large scale investments depends on strong, clear rules on market mechanisms,” said Dirk Forrister, IETA’s President and CEO. “With clarity on Article 6, they can invest with confidence in the vast opportunities for reductions and removals that are spread around the globe – and trade together to achieve net zero emissions.”

    “Article 6 is crucial to all businesses, big and small, from all sectors of the economy and from all countries” said Majda Dabaghi, Director of Inclusive & Green Growth at the International Chamber of Commerce (ICC). “Our members – 45 million businesses from over 100 countries – are eagerly awaiting clarity on Article 6 rules, which are essential to provide strong and consistent pricing signals to shift investment towards low carbon solutions.”

    Earlier this month UNFCCC Executive Secretary Patricia Espinosa told an international carbon markets conference “Never have we needed the support of international carbon markets as we do right now.”

    Forrister added: “We need clear guidance on how to account for transfers of emissions reductions, on the type of projects that can earn reductions and on measurement and verification rules. Absent that guidance, the private sector will not have the clarity it needs to deploy the billions - even trillions in capital expenditure that are needed.”

    IETA and ICC are among the signatories of a declaration on the need to promote robust accounting rules for international carbon markets, which was released at COP24.

    “The declaration is more relevant than ever, in light of the COP24 outcome, and we urge Parties to work constructively to ensure a good outcome at COP25 in Santiago,” explained Dabaghi.

    Negotiators will meet for two weeks in Bonn. The outcomes of the talks will be forwarded for final decision at the 25th Conference of Parties in December in Santiago, Chile.


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