Carbon Market Watch will be at this year’s climate change conference (COP28) in Dubai to demand, along with civil society allies, that major polluters speed up their decarbonisation and turn back the dial on accelerating global heating.

The United Nations Framework Convention on Climate Change’s (UNFCCC) 28th edition (COP28) will take place in the United Arab Emirates from 30 November to 13 December 2023. Ahead of the talks, the climate sent the countries attending this year’s forum a clear message in the form of record temperatures that have caused chaos and disruption around the world. 

Temperatures in 2023 are 1.43°C above the pre-industrial average, according to the EU’s Copernicus Climate Change Service. That is dangerously close to the 1.5°C level which would have catastrophic effects on humans and the environment alike, and which nations are trying to avoid. If this rise proves to be long term, that leaves humanity with very little wiggle room. This deepening of the climate crisis coincides with record-breaking emissions levels, with humanity pumping a whopping 57.4 gigatonnes of greenhouse gases into the atmosphere in 2022.

“Yet again, the alarm bells are ringing loud and clear but political leaders are not responding to the emergency anywhere near fast enough,” said Sabine Frank, CMW’s executive director, ahead of her departure for COP28 in Dubai. “The top priority for leaders gathered for the COP28 is to move beyond talk of ‘phasing down’ or ‘offsetting’ emissions and bring down their real emissions rapidly and significantly.”
How rapidly and how significantly was illustrated by the United Nations Environment Programme in the build up to the COP. Its 2023 Emissions Gap Report, titled Broken Record, calculated that projected 2030 GHG emissions must be cut by at least 42% if we are to achieve the Paris Agreement’s 1.5°C goal.

Not by carbon markets alone

Many governments are hoping that carbon markets under Article 6 of the Paris Agreement will save the day, while corporations are leaning heavily on the voluntary carbon market. But reality is like a lead balloon to this hot air.

“Carbon crediting markets can, in theory, have positive climate impacts – but they do not equate to climate action,” explains Isa Mulder, a policy expert on global carbon markets at CMW, who will also be in Dubai. “There is no substitute for real and deep emissions cuts. There can be no offsetting ambition.”

Despite this crystal clear reality, there is a risk that COP28 will be high on distraction and low on action. 

“The COP is likely to bring a flurry of carbon market announcements from companies and countries. Peering through the fog of these PR stunts, we might see some truly innovative ideas, but many will try to cling on to the old offsetting model,” expects Gilles Dufrasne, CMW’s lead expert on global carbon markets, who is part of CMW’s delegation to COP28. “The voluntary carbon market is in need of fresh solutions to transparently channel money to climate projects that need it.

The solution will be in the alternative models that are proposed, while laggards will try to add a new shine on the discredited model of carbon offsets.”

No quick fix to Article 6

Article 6 of the Paris Agreement envisions two types of UN carbon markets: the bilateral trading of emissions reductions between countries (Article 6.2) and a global carbon market overseen by a Supervisory Body where carbon credits can be purchased by countries or companies (Article 6.4).

Although countries can already establish bilateral agreements under Article 6.2, the architecture for the carbon market under Article 6.4 is still being hammered out. Both types of markets are dogged with difficulties and countries were divided on critical issues at the intersessional conference in Bonn in June.

The issues at stake relating to Article 6.2 include the lack of consequences if countries fail to provide key details about their trades or invoke secrecy clauses that damage the transparency and accountability of countries exchanging emissions reductions. Sticking points relating to Article 6.4 markets include the admissibility of carbon removals and what should qualify as a removal, as well as the exact quantification of emission reductions from projects.

It is vital that countries prioritise caution over haste. “The Article 6 carbon markets must uphold the highest standards for the environment, human rights, and transparency. They must be viewed and treated as a supplement to emissions reductions, not as a replacement for them,” emphasises Jonathan Crook, CMW policy expert on global carbon markets, who closely follows Article 6 negotiations. “Article 6 carbon markets cannot be rushed at the expense of people and the climate, if they are to have any role in global climate action.”

Carbon Market Watch will be at COP28 to hammer home these home truths and push countries to bring home solutions that will truly bring down emissions to sustainable levels.

CMW’s COP28 delegation