Ecosystem Marketplace and US Department of State to Assist Governments in Formulating Article 6 Carbon Markets Strategies
Ecosystem Marketplace, an initiative of the non-profit Forest Trends, has launched a new effort with support from the United States Department of State Office of Global Change to support developing country governments in considering how international carbon markets could enhance their national climate strategies. Ecosystem Marketplace (EM) will provide information and capacity building to a […]
Ecosystem Marketplace, an initiative of the non-profit Forest Trends, has launched a new effort with support from the United States Department of State Office of Global Change to support developing country governments in considering how international carbon markets could enhance their national climate strategies.
Ecosystem Marketplace (EM) will provide information and capacity building to a pilot group of Paris Agreement Parties and participants in the International Civil Aviation Organization’s global market-based measure, CORSIA (short for “Carbon Offsetting and Reduction Scheme for International Aviation”). The project’s goal is to ensure national governments are well positioned to engage in carbon markets in the course of implementing their climate strategies, while enhancing investor confidence and the supply of carbon credits that meet key multilateral standards, including Paris Agreement and CORSIA rules.
The passage of guidance on Article 6 of the Paris Agreement at the 26th Conference of Parties (COP26) in Glasgow in late 2021 provided countries with the clarity needed to authorize domestic carbon credits for international use, for example under the CORSIA or toward Paris Agreement emissions reduction targets. National governments now face a new set of complex decisions around the option to authorize domestic emissions reductions under Article 6, because any emissions reductions that are transferred and used as authorized cannot count toward achieving the host country’s Nationally Determined Contribution (NDCs) under the Paris Agreement.
“Article 6 creates new flexibility for countries, but also new complexity,” said Stephen Donofrio, Managing Director of Ecosystem Marketplace. “As an independent and objective global system of carbon market information, we want to support rational, transparent, data-driven decision-making processes that fit the needs and priorities of host countries, enabling them and buyers to benefit while continually encouraging higher NDC ambition.”
“This represents an exciting new evolution for EM – from a leading source of publications on voluntary carbon markets into a leading data, analytics, reporting, services, and thought leadership provider for expanding global carbon credit markets,” said Donofrio.
“National decisions to authorize carbon credits for international use can unlock investments and resources that developing countries critically need in order to implement their national climate strategies,” said Molly Peters-Stanley, US State Department’s Lead Negotiator on International Carbon Markets.
“We are excited to work with this new EM initiative to equip those countries with robust recent data and training that can help them amplify the benefits of carbon markets while maintaining progress in their Paris Agreement implementation.”
The new EM initiative, with financial support from the Department of State’s climate change office, will provide developing country governments worldwide with access to a console of carbon pricing data and intelligence oriented to national decision-makers, as well as decision-support tools for Article 6 authorizations piloted by another Department of State assistance program, Offsetting National Emissions through Sustainable Landscapes (ONE-SL).
The new EM International Carbon Credits Console will capture data on carbon markets and results-based payments, including, e.g., their sustainable development benefits, monetary value, and trends in carbon credit demand for national and net-zero emissions targets and CORSIA. This will be a tailored platform to directly support governments, backed by broader upgrades to EM data platforms and trading reporting processes.
The three-year project will also provide up to eight eligible developing countries with targeted technical assistance and training for government officials as they prepare their authorizations strategies and track authorizations.
“National governments will need access to best-in-class information and tools to evaluate the implications of decisions about which emissions reductions to authorize for international use, how to track those authorizations, and standardized approaches to communicating those decisions,” says Patrick Maguire, Senior Manager of Ecosystem Marketplace.
“We want to assist countries to make strategic, data-driven decisions, while ratcheting up NDC ambition. Well-functioning carbon markets are essential to achieving the Paris Agreement temperature goal and ensuring successful implementation of CORSIA,” says Maguire.
This announcement was funded by a grant from the United States Department of State. The opinions, findings and conclusions stated herein are those of the authors and do not necessarily reflect those of the United States Department of State.
Ecosystem Marketplace is an initiative of the non-profit organization Forest Trends, and a leading global source of information on environmental finance, markets, and payments for ecosystem services. As a web-based service, Ecosystem Marketplace publishes newsletters, breaking news, original feature articles, and annual reports about market-based approaches to valuing and financing ecosystem services. We believe that transparency is a hallmark of robust markets and that by providing accessible and trustworthy information on prices, regulation, science, and other market-relevant issues, we can contribute to market growth, catalyze new thinking, and spur the development of new markets and the policies and infrastructure needed to support them. Ecosystem Marketplace is financially supported by a diverse set of organizations including multilateral and bilateral government agencies, private foundations, and corporations involved in banking, investment, and various ecosystem services.
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Which 8 developing countries will be provided targeted technical assistance and training for government officials as they prepare their authorizations strategies and track authorizations?