PARIS: Two weeks of intense negotiations at COP28 concluded without a consensus on regulations for carbon credit sales, leaving a regulatory void and concerns about potential greenwashing.
While COP28 President Sultan Al Jaber announced a historic deal for transitioning away from fossil fuels, the failure to agree on a regulatory framework for carbon credits drew attention.
Carbon credits, allowing corporations or countries to offset greenhouse gas emissions, were a focal point of the discussions. The credits, often tied to projects in developing countries addressing deforestation or other environmental issues, have been controversial due to overestimated emission reductions.
Negotiations aimed to better regulate carbon credits, particularly under Article Six of the 2015 Paris Agreement, allowing voluntary cooperation between countries. However, the talks diverged from Article Six language, prompting criticism from organizations like the Climate Land Ambition and Rights Alliance (CLARA), including ActionAid, Caritas, Oxfam, and Greenpeace.
While some labeled the summit’s failure as a “relief,” others cautioned against celebration. Carbon Market Watch’s Jonathan Cook warned that countries and companies engaging in bilateral trades without a complete framework could complicate future negotiations.
The International Emissions Trading Association (IETA), representing major corporations like BP and Shell, expressed regret at the lack of consensus but suggested the mechanism could be implemented without further COP guidance.
Several countries, including Switzerland, South Korea, Japan, and Singapore, have already signed agreements to finance projects, emphasizing the urgency for a clear regulatory framework.
Amid the setbacks, COP28 did agree on a roadmap for implementing “non-market-based” cooperation, focusing on financing projects in developing countries and transferring emission-reducing technology. This small victory emphasizes the importance of non-market approaches as an alternative to traditional carbon markets.
The unresolved issues around carbon credits highlight the challenges of reaching a global consensus on regulations, raising concerns about potential environmental integrity and the effectiveness of future climate negotiations.
