COP30: ANALYSIS – Amid capacity supply crunch, does Article 6 also have a demand problem?
Despite strong interest in building up Article 6 supply, there are only a handful of sovereign buyers actively looking to procure credits for the period running to 2030, yet capacity building needs among host countries remains an even greater challenge for the near-term scaling of the market, experts and government officials told Carbon Pulse at COP30.
Read MoreCOP30: ANALYSIS – Australia’s support but lack of engagement on Article 6 confuses some, relieves others Â
Australia’s position choosing not to participate in Article 6 markets is a missed opportunity if it wants to lead climate negotiators at COP31 next year, according to some experts, while others are urging it to focus on other efforts to reduce emissions at home and abroad.
Read MoreANALYSIS: New SBTi draft Corporate Net-Zero Standard lacks impetus to drive removals, but strong recognition for carbon credit use
The latest draft of the Science Based Targets initiative’s (SBTi) Corporate Net-Zero Standard (Version 2) takes a step forward on climate finance transparency, and makes an effort to clearly recognise companies that buy quality carbon credits, but will fail to help drive near-term investment towards removals, according to market stakeholders.
Read MoreANALYSIS: PACM players gain new accommodations as pragmatism wins out on controversial carbon permanence standard
The Article 6.4 Supervisory Body (SBM) last week adopted Paris Agreement Crediting Mechanism (PACM) decisions governing reversals, additionality, and the Clean Development Mechanism (CDM) market transition, codifying new flexibilities and deferring hard calls to future work.
Read MoreANALYSIS: Indonesia’s agreements with voluntary standards welcomed, but experts warn of complexity risks
Recent moves by the Indonesian government to ink recognition agreements with major voluntary standards will help provide wider market access to local projects, however experts are concerned about the inherent risks in what is being seen as increasingly complex regulatory framework.
Read MoreCWNYC25: ANALYSIS – Threats to CORSIA build, even as carbon market strikes optimistic tone
Changing political dynamics, authorisation bottlenecks, and a persistent lack of eligible credits pose a threat to the future of CORSIA, but market participants still see momentum behind the UN’s international aviation offsetting scheme with supply and demand expected to ramp up from next year.
Read MoreANALYSIS: Australian environmental reforms yet to align with its emissions reduction goals, experts say
Australian environment and clean energy groups have raised concerns that the government’s environmental law reforms are not reflecting the need to massively scale up carbon removal and renewable energy, as outlined in its sectoral decarbonisation plans.
Read MoreANALYSIS: China’s underwhelming 2035 NDC indicates cautious approach to climate action
China’s newly announced 2035 Nationally Determined Contribution (NDC), while introducing absolute emission reduction targets for the first time, reflects the government’s cautious approach to climate action, experts told Carbon Pulse.
Read MoreANALYSIS: Colombian CO2 tax offsetting exceeds 50% cap amid glut of low-priced credits
Colombian CO2-taxable entities have retired carbon credits equivalent to more than 50% of their levy burden in H1 2025, above the legal threshold, as eligible credits amass at low prices and fears build that politicians may push the cap down further.
Read MoreANALYSIS: Developers fear glut as demand lags for India’s farm credits
Indian farms could remove billions of tonnes of CO2 from the atmosphere in the coming decades, but scaling carbon credit projects across its patchwork of smallholdings must first contend with low farmer incentives and policy exclusions to doubts over sustained demand.
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