IETA NETWORK CONNECTION
COP25: It's time
COP25 begins today in Madrid and this time the stakes are higher than ever. COP24 was successful in delivering the Paris Agreement Rulebook (if the Agreement tells us what we need to do, the Rulebook tells us how to do it) but left one key element out: guidance for Article 6, which is now due to be adopted at COP25.
Article 6 has the potential to make or break the Paris Agreement. Recent research has found that Article 6 has the potential to halve the cost of implementing Nationally Determined Contributions (NDCs), thereby saving an estimated $250 billion annually by 2030 alone. If these savings are reinvested into more mitigation, then an additional 5 billion tonnes of carbon dioxide emissions a year would be reduced in 2030, thereby achieving enhanced ambition. The cost savings grow to $320 billion annually by 2030, and the additional mitigation to 9 billion tonnes, if land-based mitigation is included.
This additional mitigation would bring us much closer to the level of ambition needed to meet the goals of the Paris Agreement. Beyond facilitating enhanced ambition, Article 6 will be crucial to reach net zero emissions as quickly as possible, as it provides a framework to balance remaining emissions with sinks – delivering a net zero balance.
At the same time, poorly designed Article 6 rules could ‘break’ the Agreement. The two main risks are having complexities, limitations and burdens that do not incentivise the use of Article 6, thus don’t capitalise on its potential, and having rules that compromise environmental integrity and allow double counting.
We, of course, want to stay positive and have confidence in a good outcome on Article 6 at COP25. By a ‘good outcome’, we mean a ruleset that ensures environmental integrity and the avoidance of double counting through sound accounting rules. IETA, together with a group of 40+ companies, business groups and NGOs called for that last year at COP24 and will keep calling for that at COP25.
A good outcome is also one that gives full clarity on key features of Article 6, allowing governments and businesses to start planning for its implementation, and sets up a structured work programme to tackle remaining technical issues. If you want to find out more about this, you can have a look at our views on Article 6 and Priorities for COP25.
Of course, the Article 6 potential mentioned earlier is purely theoretical and several things will need to happen to unlock even a fraction of it. Having a strong set of rules for Article 6 is an essential milestone, but it will just be the first step in the process. The next challenge after COP25 will be to work with interested countries on how to use Article 6, to start delivering its potential benefits in the real world.
But, first things first, let’s focus on COP25. Stay tuned; the next Network Connection will be all about what happened in Madrid!
Stefano De Clara
For more information on IETA and our work, see www.ieta.org
IETA Member's Corner
How is EcoMetrix Africa involved in the carbon market?
EcoMetrix Africa is a South African management consulting firm that has successfully issued and commercialised close to 4 million carbon credits across a wide range of sectors and technologies, making it the trusted carbon revenue generation partner for projects in South Africa. We have successfully worked with our clients to provide the following suite of services related to carbon markets and generating carbon offsets:
Moreover, EcoMetrix Africa consultants closely followed the development process of the South African Carbon Tax legislation and the Carbon Tax offset regulations during their formative years, being the first law and regulation of this kind on the African continent.
Across the board, our work specialises in climate change, green economy and renewable energy. We assist both government and business in defining low-carbon and adaptation strategies, managing energy, carbon and water performance as well as developing and financing renewable energy and energy efficiency projects.
Why did you join IETA?
IETA provides the largest international platform for thought leaders, industry news as well as various resources on carbon markets and the carbon trading sphere. Following the coming into effect of the South Africa Carbon Tax, the move to join IETA was to strategically place our company to work hand in hand with local and international initiatives that strive to align South Africa with global carbon markets.
The Economic Potential of Article 6 of the Paris Agreement and Implementation Challenge report, prepared by IETA and co-sponsored by Carbon Pricing Leadership Coalition,with the help of researchers and modellers from the University of Maryland