{"id":214750,"date":"2025-12-04T09:21:21","date_gmt":"2025-12-04T09:21:21","guid":{"rendered":"https:\/\/www.europesays.com\/ie\/214750\/"},"modified":"2025-12-04T09:21:21","modified_gmt":"2025-12-04T09:21:21","slug":"cop30-momentum-grows-behind-carbon-markets-as-a-climate-solution","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/ie\/214750\/","title":{"rendered":"COP30: Momentum grows behind carbon markets as a climate solution"},"content":{"rendered":"<ul data-testid=\"Summary\" class=\"summary-module__summary__QjADA\">\n<li data-testid=\"Body\" class=\"text-module__text__0GDob text-module__dark-grey__UFC18 text-module__regular__qJJtA text-module__small__sph8i body-module__base__o--Cl body-module__small_body__gOmDf summary-module__point__UgXPz\">Carbon markets weren&#8217;t in COP30 document, but several developments bolstered them<\/li>\n<li data-testid=\"Body\" class=\"text-module__text__0GDob text-module__dark-grey__UFC18 text-module__regular__qJJtA text-module__small__sph8i body-module__base__o--Cl body-module__small_body__gOmDf summary-module__point__UgXPz\">Open Coalition on Compliance Carbon market was launched, with 18 jurisdictions<\/li>\n<li data-testid=\"Body\" class=\"text-module__text__0GDob text-module__dark-grey__UFC18 text-module__regular__qJJtA text-module__small__sph8i body-module__base__o--Cl body-module__small_body__gOmDf summary-module__point__UgXPz\">EU submits climate plan that allows carbon credits to account for 5% of emissions reductions<\/li>\n<li data-testid=\"Body\" class=\"text-module__text__0GDob text-module__dark-grey__UFC18 text-module__regular__qJJtA text-module__small__sph8i body-module__base__o--Cl body-module__small_body__gOmDf summary-module__point__UgXPz\">Article 6 Ambition Alliance is formed<\/li>\n<li data-testid=\"Body\" class=\"text-module__text__0GDob text-module__dark-grey__UFC18 text-module__regular__qJJtA text-module__small__sph8i body-module__base__o--Cl body-module__small_body__gOmDf summary-module__point__UgXPz\">Coalition to Grow Carbon Markets gains new members<\/li>\n<\/ul>\n<p>November 28 &#8211; Reading the text of the final deal at COP30, which was agreed on Saturday after more than two weeks of talks in Bel\u00e9m, it would be easy to miss the role of the carbon markets in the fight against climate change.<\/p>\n<p>The carbon markets are not even mentioned directly in the document, besides a vague nod to the importance of Article 6 of the Paris Agreement, which sets the framework for how countries can use carbon credits to meet their emission-reduction commitments under their nationally determined contributions, including trading credits between themselves.<\/p>\n<p>Few would claim that the carbon markets have fully recovered from a series of scandals, beginning in 2022, that shook confidence in credit schemes. Coming out of COP30, however, there is some evidence that efforts to revitalise the carbon markets are gaining momentum.<\/p>\n<p>\u201cI do think there is constant progress,\u201d says Beatriz Granziera, senior climate policy adviser at The Nature Conservancy. \u201c2025 has been an important year for carbon markets, and specifically carbon markets under the Paris Agreement.\u201d<\/p>\n<p>Some of the trickiest issues around the carbon markets were partially resolved last year at COP29 in Baku, when governments finally reached a deal on bringing Article 6 into operation. While technical negotiations did continue on some of the finer details of implementing Article 6, it was never likely that carbon markets would find a place in the high-level political negotiations in Bel\u00e9m.<\/p>\n<p>Yet the venue of the talks in the Amazon meant it was impossible to ignore the potential of the carbon markets to help tackle one of the key drivers of the climate crisis.<\/p>\n<p>The Amazon rainforest h<a data-testid=\"Link\" title=\"https:\/\/www.cfr.org\/amazon-deforestation\/#\/en\" target=\"_self\" referrerpolicy=\"no-referrer-when-downgrade\" href=\"https:\/\/www.cfr.org\/amazon-deforestation\/#\/en\" rel=\"nofollow noopener\" class=\"text-module__text__0GDob text-module__inherit-color__PhuPF text-module__inherit-font__1P1hv text-module__inherit-size__EyiQW link-module__link__INqxZ link-module__underline_default__-okuC\">as lost around a fifth<\/a> of its former area over the past half century. Large parts of the rainforest are <a data-testid=\"Link\" title=\"https:\/\/research.noaa.gov\/deforestation-warming-flip-part-of-amazon-forest-from-carbon-sink-to-source\/\" target=\"_self\" referrerpolicy=\"no-referrer-when-downgrade\" href=\"https:\/\/research.noaa.gov\/deforestation-warming-flip-part-of-amazon-forest-from-carbon-sink-to-source\/\" rel=\"nofollow noopener\" class=\"text-module__text__0GDob text-module__inherit-color__PhuPF text-module__inherit-font__1P1hv text-module__inherit-size__EyiQW link-module__link__INqxZ link-module__underline_default__-okuC\">no longer a carbon <\/a>sink, but instead release carbon dioxide into the atmosphere, mainly due to fires.<\/p>\n<p>The Amazon is also one of the best places in the world for carbon credit projects. The ability of trees to grow at prolific rates in this tropical climate means it is possible to issue carbon credits within just a few years of planting.<\/p>\n<p>Field trip to visit Mombak carbon removals project, one of the world&#8217;s largest forest restoration projects, during COP30 <a data-testid=\"Link\" target=\"_blank\" referrerpolicy=\"no-referrer-when-downgrade\" href=\"https:\/\/www.reutersconnect.com\/item\/field-trip-to-visit-mombak-carbon-removals-project-during-cop30\/dGFnOnJldXRlcnMuY29tLDIwMjU6bmV3c21sX01UMUVDTUlJOFAySEUyRTNUSlBFVldYUk9YMDZKRDI1RlAx\/?utm_medium=rcom-article-media&amp;utm_campaign=rcom-rcp-lead\" rel=\"noopener nofollow\" class=\"text-module__text__0GDob text-module__inherit-color__PhuPF text-module__inherit-font__1P1hv text-module__inherit-size__EyiQW link-module__link__INqxZ link-module__underline_default__-okuC link-module__with-icon__qlg76 collapsible-caption-module__license__CPQvV\">Purchase Licensing Rights, opens new tab<\/a><\/p>\n<p>And the carbon markets could be the key to financing the forest\u2019s future. Ana Carolina Avzaradel Szklo, technical director for markets and standards at the Voluntary Carbon Markets Integrity Initiative, notes that $7 billion a year is needed to conserve the Amazon, yet less than $6 billion has been mobilised over the whole of the last decade.<\/p>\n<p>Szklo warns there has been a \u201clack of clarity\u201d among potential buyers about what constitutes a high-quality carbon credit and how these can be used in corporate net-zero strategies. For Brazil, she argues, it is important to establish robust standards as carbon projects scale up. \u201cSetting the bar high is important so that we really drive a shift in the market.\u201d<\/p>\n<p>One of the carbon developers to have spotted the potential of the area is Brazilian carbon removals company Mombak. Around 125km south of Bel\u00e9m, the company is working to turn a former cattle ranch back into a thriving rainforest.<\/p>\n<p>Mombak has secured offtake agreements with major tech companies, including Google and Microsoft. But Peter Fernandez, the company\u2019s executive chairman, acknowledges that voluntary demand alone will not be enough.<\/p>\n<p>\u201cVoluntary demand is amazing, and I think that it will continue to grow, but I don&#8217;t think that it will get to the level of 10 billion tonnes per year,\u201d he says, referring to the <a data-testid=\"Link\" title=\"https:\/\/rmi.org\/what-we-really-mean-by-the-massive-scale-required-for-cdr-in-climate-goals\/\" target=\"_blank\" referrerpolicy=\"no-referrer-when-downgrade\" href=\"https:\/\/rmi.org\/what-we-really-mean-by-the-massive-scale-required-for-cdr-in-climate-goals\/\" rel=\"noopener nofollow\" class=\"text-module__text__0GDob text-module__inherit-color__PhuPF text-module__inherit-font__1P1hv text-module__inherit-size__EyiQW link-module__link__INqxZ link-module__underline_default__-okuC link-module__with-icon__qlg76\">level of carbon removal , opens new tab<\/a>scientists believe is needed by 2050 to meet the goals of the Paris Agreement.<\/p>\n<p>Multiple jurisdictions have already established regulated carbon markets. In some cases, companies can offset carbon taxes by purchasing carbon credits, although most jurisdictions currently require companies to purchase credits from domestic projects. However, Fernandez is one of many who sees a greater role for the international trade in carbon credits.<\/p>\n<p>\u201cIt just makes sense that these markets will begin to fuse and become more porous with one another over time,\u201d he says. \u201cI think it&#8217;s ultimately what&#8217;s going to get us to the degree of demand that is required to achieve humanity&#8217;s goal.\u201d<\/p>\n<p>European Commission President Ursula von der Leyen attends the Leaders&#8217; Summit ahead of COP30 in Brazil. Carbon market experts said the EU&#8217;s decision to allow high-integrity carbon credits to meet 5% of the bloc&#8217;s 2040 climate targets was &#8220;a game-changer&#8221; in terms of generating demand.   REUTERS\/Adriano Machado <a data-testid=\"Link\" target=\"_blank\" referrerpolicy=\"no-referrer-when-downgrade\" href=\"https:\/\/www.reutersconnect.com\/item\/cop30-climate-summit-in-belem\/dGFnOnJldXRlcnMuY29tLDIwMjU6bmV3c21sX01UMUVDTUlJOFAySEUyRTNUSlBFVldYUk9YMDZKRDI1RlAw\/?utm_medium=rcom-article-media&amp;utm_campaign=rcom-rcp-lead\" rel=\"noopener nofollow\" class=\"text-module__text__0GDob text-module__inherit-color__PhuPF text-module__inherit-font__1P1hv text-module__inherit-size__EyiQW link-module__link__INqxZ link-module__underline_default__-okuC link-module__with-icon__qlg76 collapsible-caption-module__license__CPQvV\">Purchase Licensing Rights, opens new tab<\/a>Bel\u00e9m took a step towards convergence between regulated markets with the launch of the <a data-testid=\"Link\" title=\"https:\/\/cop30.br\/en\/news-about-cop30\/carbon-market-coalition-welcomes-18-member-countries-at-cop30\" target=\"_blank\" referrerpolicy=\"no-referrer-when-downgrade\" href=\"https:\/\/cop30.br\/en\/news-about-cop30\/carbon-market-coalition-welcomes-18-member-countries-at-cop30\" rel=\"noopener nofollow\" class=\"text-module__text__0GDob text-module__inherit-color__PhuPF text-module__inherit-font__1P1hv text-module__inherit-size__EyiQW link-module__link__INqxZ link-module__underline_default__-okuC link-module__with-icon__qlg76\">Open Coalition on Compliance Carbon Markets, opens new tab<\/a>. Some 18 jurisdictions signed up to the initiative, including the European Union, Brazil and China. Its initial focus will be on sharing best practices in monitoring, reporting and verification, and in establishing common carbon accounting standards.Meanwhile, in the run-up to COP30, the EU announced it will impose a 2040 target to reduce emissions by 90%, compared to 1990 levels. <a data-testid=\"Link\" title=\"https:\/\/www.consilium.europa.eu\/en\/press\/press-releases\/2025\/11\/05\/2040-climate-target-council-agrees-its-position-on-a-90-emissions-reduction\/\" target=\"_self\" referrerpolicy=\"no-referrer-when-downgrade\" href=\"https:\/\/www.consilium.europa.eu\/en\/press\/press-releases\/2025\/11\/05\/2040-climate-target-council-agrees-its-position-on-a-90-emissions-reduction\/\" rel=\"nofollow noopener\" class=\"text-module__text__0GDob text-module__inherit-color__PhuPF text-module__inherit-font__1P1hv text-module__inherit-size__EyiQW link-module__link__INqxZ link-module__underline_default__-okuC\">Some 5% of this reduction<\/a> can come from high-quality international carbon credits.<\/p>\n<p>The move by Brussels \u201cwould be a game changer for Article 6 demand\u201d, says Granziera. She notes that EU countries would require a minimum of 200 million tonnes to meet this 5% figure, which would approximately double the current level of demand from buyer countries under Article 6.2.<\/p>\n<p>The EU decision is a \u201chuge change\u201d, agrees Sheri Hickok, CEO of investment firm Climate Impact Partners. Hickok also highlights the importance of the Science Based Targets initiative \u2013 which has spent more than a year wrestling with internal divisions over carbon offsets \u2013 deciding to <a data-testid=\"Link\" title=\"https:\/\/sciencebasedtargets.org\/news\/sbti-releases-second-draft-corporate-net-zero-standard-v2-for-consultation\" target=\"_self\" referrerpolicy=\"no-referrer-when-downgrade\" href=\"https:\/\/sciencebasedtargets.org\/news\/sbti-releases-second-draft-corporate-net-zero-standard-v2-for-consultation\" rel=\"nofollow noopener\" class=\"text-module__text__0GDob text-module__inherit-color__PhuPF text-module__inherit-font__1P1hv text-module__inherit-size__EyiQW link-module__link__INqxZ link-module__underline_default__-okuC\">create a mechanism<\/a> for companies to use carbon credits in their net-zero strategies in the latest draft of its Corporate Net-Zero Standard.<\/p>\n<p>More than 11,000 companies have committed to adopting net-zero targets through the SBTi. Its updated guidance, therefore, has potential to spur a significant increase in demand for carbon credits.<\/p>\n<p>Another initiative that gained momentum at COP is the Coalition to Grow Carbon Markets. Announced during London Climate Action Week in June, the Coalition is led by the UK, Singapore and Kenya and intends to promote harmonised policies that will help drive demand for credits. At COP, <a data-testid=\"Link\" title=\"https:\/\/coalitiontogrowcarbonmarkets.org\/international-momentum-at-cop30-as-11-governments-endorse-shared-principles\/\" target=\"_blank\" referrerpolicy=\"no-referrer-when-downgrade\" href=\"https:\/\/coalitiontogrowcarbonmarkets.org\/international-momentum-at-cop30-as-11-governments-endorse-shared-principles\/\" rel=\"noopener nofollow\" class=\"text-module__text__0GDob text-module__inherit-color__PhuPF text-module__inherit-font__1P1hv text-module__inherit-size__EyiQW link-module__link__INqxZ link-module__underline_default__-okuC link-module__with-icon__qlg76\">several more countries endorsed, opens new tab<\/a> the Coalition\u2019s Shared Principles for Growing High-Integrity Use of Carbon Credits, bringing the total number of endorsements to 11.<\/p>\n<p>Fred Teo, CEO of Singapore-based carbon markets investor GenZero, describes the growing role of governments in promoting the carbon markets as \u201cextremely important\u201d. At a stage when the market is still nascent, he argues that \u201cgovernment participation lends credibility and certainty\u201d, helping corporates to feel greater confidence in purchasing credits.<\/p>\n<p>Singapore, despite its diminutive size, has emerged as a leader in the carbon markets space. The city state has signed Article 6 agreements with multiple countries, allowing Singaporean companies to purchase credits from approved projects in those countries to offset part of their carbon tax obligations. The Singaporean government itself announced in September that it will contract more than 2 million tonnes of nature-based carbon credits from projects in Ghana, Peru and Paraguay to help meet its NDC.<\/p>\n<p>Teo says it is \u201cinstinctive\u201d for a small country like Singapore to look beyond its borders, but adds that the international trade in credits should be an important part of the solution globally. Credit purchases under Article 6 will help provide a new source of climate finance for the Global South, he says, while also reducing carbon compliance costs for companies and helping to mitigate climate change.<\/p>\n<p>A view of the central business district skyline in Singapore May 27, 2025. Singapore is a leader in the carbon markets space. REUTERS\/Edgar Su <a data-testid=\"Link\" target=\"_blank\" referrerpolicy=\"no-referrer-when-downgrade\" href=\"https:\/\/www.reutersconnect.com\/item\/a-view-of-the-central-business-district-skyline-in-singapore\/dGFnOnJldXRlcnMuY29tLDIwMjU6bmV3c21sX01UMUVDTUlJOFAySEUyRTNUSlBFVldYUk9YMDZKRDI1RlAz\/?utm_medium=rcom-article-media&amp;utm_campaign=rcom-rcp-lead\" rel=\"noopener nofollow\" class=\"text-module__text__0GDob text-module__inherit-color__PhuPF text-module__inherit-font__1P1hv text-module__inherit-size__EyiQW link-module__link__INqxZ link-module__underline_default__-okuC link-module__with-icon__qlg76 collapsible-caption-module__license__CPQvV\">Purchase Licensing Rights, opens new tab<\/a>Yet another initiative to launch at COP30 is the <a data-testid=\"Link\" title=\"https:\/\/www.bafu.admin.ch\/bafu\/en\/home\/topics\/climate\/klimapolitik\/climate--international-affairs\/article-6-ambition-alliance-aaa6.html\" target=\"_blank\" referrerpolicy=\"no-referrer-when-downgrade\" href=\"https:\/\/www.bafu.admin.ch\/bafu\/en\/home\/topics\/climate\/klimapolitik\/climate--international-affairs\/article-6-ambition-alliance-aaa6.html\" rel=\"noopener nofollow\" class=\"text-module__text__0GDob text-module__inherit-color__PhuPF text-module__inherit-font__1P1hv text-module__inherit-size__EyiQW link-module__link__INqxZ link-module__underline_default__-okuC link-module__with-icon__qlg76\">Article 6 Ambition Alliance, opens new tab<\/a>. The 10 member countries intend to use Article 6 deals to go beyond their NDC commitments. Meanwhile, a series of bilateral Article 6 agreements were announced at the summit, including between Switzerland and Zambia.<\/p>\n<p>But for all the optimism coming out of COP30, there are still multiple issues to resolve before the carbon markets can play a bigger role in protecting and restoring ecosystems like the Amazon.<\/p>\n<p>Teo laments a \u201cweird narrative\u201d that favours projects that remove carbon from the atmosphere (such as through tree planting) over those that seek to reduce or avoid emissions (such as through preserving existing forests). World Bank data shows that the average price for forestry removals credits is now around three times higher than for avoidance equivalents.<\/p>\n<p>\u201cWe have a danger of misallocating capital and over-allocating towards removals and under-allocating towards protection,\u201d Teo warns.<\/p>\n<p>There is also an ongoing debate about how \u201cpermanent\u201d carbon removals need to be. The Article 6.4 Supervisory Body, which is tasked with drawing up standards for credits, had been leaning towards stringent rules that <a data-testid=\"Link\" title=\"https:\/\/d2iwpl8k086uu2.cloudfront.net\/docs\/default-source\/s3-library\/publication-pdfs\/fv-open-letter-cop30-proposed-guidance-on-article-6-4.pdf?sfvrsn=c4c1b5ff_2\" target=\"_self\" referrerpolicy=\"no-referrer-when-downgrade\" href=\"https:\/\/d2iwpl8k086uu2.cloudfront.net\/docs\/default-source\/s3-library\/publication-pdfs\/fv-open-letter-cop30-proposed-guidance-on-article-6-4.pdf?sfvrsn=c4c1b5ff_2\" rel=\"nofollow noopener\" class=\"text-module__text__0GDob text-module__inherit-color__PhuPF text-module__inherit-font__1P1hv text-module__inherit-size__EyiQW link-module__link__INqxZ link-module__underline_default__-okuC\">critics warned<\/a> would effectively exclude nature-based projects.<\/p>\n<p>\u201cIf we go with 100-year-plus permanence, we completely kick out nature,\u201d says Hickok of Climate Impact Partners. \u201cIs that really a pragmatic approach with what we are trying to accomplish?\u201d<\/p>\n<p>The Supervisory Body conceded that its critics had a point in October, with a draft standard that preserves greater flexibility. Further decisions are expected in 2026.<\/p>\n<p>While COP30 did not see decisive breakthroughs on the key disagreements around how the carbon markets should operate, some of the key players in the market seemed to leave the Amazon with a spring in their step.<\/p>\n<p>\u201cThere is a growing consensus that there is at least a place for carbon credits to help with the overall decarbonisation journey,\u201d says Teo.<\/p>\n<p>Opinions expressed are those of the author. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias. Ethical Corporation Magazine, a part of Reuters Professional, is owned by Thomson Reuters and operates independently of Reuters News.<\/p>\n<p><a href=\"https:\/\/www.reutersagency.com\/en\/licensereuterscontent\/?utm_medium=rcom-article-media&amp;utm_campaign=rcom-rcp-lead\" target=\"_blank\" dir=\"ltr\" class=\"button-module__link__A3sD0 button-module__secondary__70gBu button-module__round__QDFgq button-module__w_auto__Sem-F\" data-testid=\"LicenceContentButton\" rel=\"nofollow noopener\">Purchase Licensing Rights<\/a><a data-testid=\"AuthorBioImageLink\" class=\"author-bio-module__author-image__jcaG3\" href=\"https:\/\/www.reuters.com\/authors\/ben-payton\/\" referrerpolicy=\"no-referrer-when-downgrade\" tabindex=\"-1\" rel=\"nofollow noopener\" target=\"_blank\"><\/a><\/p>\n<p data-testid=\"Body\" class=\"text-module__text__0GDob text-module__dark-grey__UFC18 text-module__regular__qJJtA text-module__extra_small__8Buss body-module__base__o--Cl body-module__extra_small_body__Bfz20 author-bio-module__description__9ynkB\">Ben Payton is a freelance journalist focused on responsible investment, natural resources and the energy transition. Ben also writes for titles including Responsible Investor, African Business Magazine and fDi Intelligence<\/p>\n","protected":false},"excerpt":{"rendered":"Carbon markets weren&#8217;t in COP30 document, but several developments bolstered them Open Coalition on Compliance Carbon market was&hellip;\n","protected":false},"author":2,"featured_media":214751,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[269],"tags":[87671,18,440,19,17,87670,87669,133,15170],"class_list":{"0":"post-214750","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-environment","8":"tag-destecmii","9":"tag-eire","10":"tag-environment","11":"tag-ie","12":"tag-ireland","13":"tag-n2esg","14":"tag-rsbiindustry-insight","15":"tag-science","16":"tag-sustainable-business"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@ie\/115660566257854951","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts\/214750","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/comments?post=214750"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts\/214750\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/media\/214751"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/media?parent=214750"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/categories?post=214750"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/tags?post=214750"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}