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Carbon market negotiations under the Paris Agreement

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Climate negotiators gathered in Bonn, Germany, in recent weeks for talks aimed at making progress ahead of the COP25 meeting in Santiago, Chile, in December. (Photograph: UNFCCC)

The world’s climate negotiators recently concluded two weeks of discussions about the next steps for the landmark 2015 Paris Agreement, with carbon market rules high on the agenda.

The annual mid-year climate negotiations are generally held ahead of the annual Conference of the Parties (COP), the top decision-making body for climate negotiations.

The recent COP24, in Katowice, Poland, was heralded by many as a success in multilateralism and diplomacy. It adopted an almost complete set of rules and guidelines supporting implementation of the Paris Agreement. However, the parties did not ultimately reach a consensus on one specific area: the rules for using carbon markets.

These rules are known in the climate jargon as the “Article 6 rules”, after the Paris Agreement article that mandates them. After the inconclusive talks at COP24, negotiators were tasked to come up with a new proposal for the Article 6 rules that could be adopted at the next COP25, in Santiago, Chile, later this year.

At the recent meeting in Bonn, which concluded last week, countries made good progress on technical discussions and came up with a new negotiating text. But disagreements remain about the status of the text and how to take it forwards. This means that there is everything to play for as we move towards COP25.

Here are some key points for understanding why carbon markets matter so much under the Paris Agreement and what the bottlenecks are in the negotiations.

What is Article 6 of the Paris Agreement?

Carbon markets are aimed at lowering the cost of reducing greenhouse gases emissions. Expanding and linking those markets internationally can help further drive down the cost of achieving emission reduction targets, helping to stimulate the needed investments for clean energy transitions.

By agreeing to Article 6 of the Paris Agreement, countries opened the way for a new form of international interaction on carbon markets. Article 6 builds on a long history of market approaches under the Kyoto Protocol, the Paris Agreement’s predecessor.

Article 6 is intended to support countries in enhancing the ambitions of their stated climate actions, known as Nationally Determined Contributions (NDCs), which collectively contribute to the overarching goal of the Paris Agreement: keeping the rise in global average temperatures to well below 2 degrees Celsius and to pursue efforts to limit the temperature increase to 1.5 degrees Celsius. However, the nature of carbon markets means that robust rules are important to ensure that environmental and sustainable development gains are realised. Article 6 introduces two voluntary market-based paths for international co-operation.

Article 6.2 sets out the principles for voluntary co-operative approaches. One country can transfer so-called “internationally transferred mitigation outcomes” (ITMOs) to another country, which can then use them towards its NDC target. These transfers must apply robust and transparent accounting rules to avoid double counting of ITMOs and to ensure environmental integrity. The transfers can take place using various approaches and mechanisms, such as bilateral cooperation programmes between countries, or national or regional emission trading schemes (ETS).

Article 6.4 establishes a mechanism to contribute to the mitigation of greenhouse gas emissions and support sustainable development, under the oversight of a central UN governance body. Public and private entities can participate in this mechanism if authorised by a country. While the main intention is that emissions reductions from the mechanism will count towards achievement of countries’ NDCs, the mechanism could also be used in other ways. For example, airlines could use credits from the mechanism to comply with the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) of the International Civil Aviation Organization (ICAO). Other companies could use them to count towards carbon neutrality. However, double counting of these emission reductions must be avoided.

Despite the lack of a formal outcome on Article 6 at the recent negotiations in Bonn, countries made substantial progress and had constructive discussions. Differences remain on several issues ahead of COP25, though. For instance, countries have not yet agreed on an accounting system to avoid double counting and other elements needed to prevent potential environmental integrity risks.

How is the IEA contributing?

The IEA is contributing to the discussions on Article 6 – as well as to the negotiations more broadly – through technical analysis by the joint OECD-IEA Climate Change Expert Group (CCXG). For more than 25 years, the CCXG has been developing and publishing technical papers in consultation with a wide range of countries to inform ongoing climate negotiations.

Through the CCXG, the IEA recently co-published a technical paper that analyses two specific unresolved issues in the negotiations of rules for Article 6 of the Paris Agreement: the accounting system of Article 6.2, and the implications of a potential transition of Kyoto Protocol mechanisms to the Article 6.4 mechanism. The outcomes of the paper were presented at a side event during the Bonn conference and directly informed the negotiations.

The CCXG also convenes two major events per year to promote dialogue among government delegates and experts from developed and developing economies, outside of the formal negotiations. Discussions stretch well beyond carbon markets, also covering the transparency framework of the Paris Agreement and climate finance issues, among others. The next edition of these invitation-only Global Forums on the Environment and Climate Change will be held at the IEA headquarters in Paris on 1-2 October. In addition, the IEA is ramping up its efforts to support countries in implementing and enhancing their NDCs.

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Green Planet

The Meeting Point between Pandemic and Environmental

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Humans in the Anthropocene

Humans are born from history, on the other hand, history is born from human life. Currently, humans have been in the Anthropocene, the era after the Holocene, a time when humans were more powerful in nature. This results in an imbalance of give and take activities between humans and the nature they inhabit. With rapid population growth, human needs will also increase. This increase in human needs will have an impact on the availability of existing natural resources. Exploitation of natural products such as coal, natural gas and others, this is accompanied by waste from production and human activities that produce waste in many sectors of life. What has been exploited by humans the impact is no longer comparable to what nature gives. Although nature has the ability to self-regenerate, but with human activities that are so aggressive in this era of globalization, it defeats the natural processes of nature. The presence of factories around the world after the steam engine and the industrial revolution occurred, weapons such as missiles, atomic bombs as a means of war for fellow humans, rockets and all kinds of vehicles of human ambition to export nature, all produce residual waste that is released, resulting in a large carbon footprint. affect the atmosphere which is as a protector and temperature regulator on earth. Not to mention the mining of many other crops.

The question that may often be asked but doesn’t need to be answered is “why should humans care about all that?”

In the last 100 years, the earth’s average temperature has increased between 0.4 to 0.8 C. The ambition of the countries in the world today is 1.5 degrees Celsius, whereas humans are facing the risk of an increase of 4 degrees, which means it will be the same with the temperatures that occurred between the Ice Age and the Holocene. In other words, humans are still far behind with the rate of destruction that exists. This warming will result in the emergence of many disasters in human life. Global warming is expected to cause the glaciers at both poles to melt and make the volume of sea water increase, most likely some islands on earth are at risk of sinking, especially the Indonesian archipelago which is a young land in geological history. Not only that, other impacts will be felt on climate change, a matter of months, days, seasons. Nature which is the main benchmark for farmers, fishermen and various sectors of work related to climate and seasons will feel a prediction crisis, several regions in Indonesia experience crop failures due to the calculations they do based on seasonal calculations are no longer accurate, even though these calculations have been passed down from generation to generation. inherited. But climate change and global warming have messed up astronomy. Maybe this is also what makes the Mayan calendar (piktun) only predict until 2012.

Not only the estimated harvest season, natural imbalances also cause the spread of disease vectors from animals to humans. Until now there has been no single plausible theory that definitely and accurately explains where COVID-19 came from and how it will disappear. Research is still being done, all theories put forward by scientists can be true. But scientists who study the environment, viruses, pandemics, health have found this conundrum, which all starts with “environmental imbalance”. If we describe briefly, in the food chain there is one missing which then results in advantages and disadvantages between predators and prey. If the rice field snakes are hunted by farmers, the rats will live more, and then they will eat the rice too, eventually the farmers will fail to harvest. Likewise, the case of COVID-19, with the large number of killings of wildlife, has shifted the pattern of the food chain.

Covid 19 and the balance of nature

There are many theories that explain the origin of the pandemic that humans are experiencing now, but until now there is no definite news about where the origin and cause of the catastrophe exists. US intelligence agencies say they may never be able to identify the origins of Covid-19, but they have concluded the virus was not created as a biological weapon. Apart from the specifics of covid 19 which is a virus, whose existence can never be seen with the naked eye, a number of scientists believe that the covid 19 pandemic occurs due to natural imbalances. The COVID-19 pandemic which was determined by the World Health Organization (WHO) or world health agency on March 11, 2020, could also occur due to the interruption of the food cycle which resulted in the explosion of a component of life without a predator in the same period of time.

The SARS-VoV-2 virus is a disease that originates from animals and is transmitted to humans. It is possible that the disease originated in bats, then spread through other mammals.

Even though it is not made in a laboratory, it does not mean that humans have no role in the ongoing pandemic. A recent study by scientists from Australia and the US found that human actions on natural habitats, loss of biodiversity and destruction of ecosystems contributed to the spread of the virus.

The number of infectious diseases has more than tripled every decade since the 1980s. More than two-thirds of these diseases come from animals, and about 70% of that number comes from wild animals. Infectious diseases that we know, for example: Ebola, HIV, swine flu and bird flu, are diseases that can be transmitted from animals to humans.

COVID-19 is also spreading rapidly as the world’s population is becoming more and more closely connected. This situation that surprised many people, had actually been warned by scientists for a long time. Joachim Spangenberg, Vice President of the European Institute for Sustainability Research, said that by destroying ecosystems, humans create conditions that cause animal viruses to spread to humans. “We created this situation, not the animals,” said Spangenberg. In 2016 UNEP Frontier has been warned that at least every four months a new zoonotic disease will emerge. This is due to human activities as follows:

Deforestation and habitat destruction

because humans are increasingly opening up areas inhabited by wild animals to graze livestock and take natural resources, humans are also increasingly susceptible to pathogens that have never previously left the area, and leave the bodies of the animals they inhabit.

“We’re getting closer to wild animals,” said Yan Xiang, a virologist at the University of Texas Center for Health Sciences. “And that puts us in touch with those viruses.” While David Hayman, professor of infectious disease ecology at Massey University, New Zealand said, the risk is also increasing not only through humans entering natural habitats, but also through animals. human pet

In addition, the destruction of ecosystems also has an impact on which types of viruses thrive in the wild and how they spread.

David Hayman emphasized, in the last few centuries, tropical forests have been reduced by 50%. This has a very bad impact on the ecosystem. In a number of cases, scientists have succeeded in revealing, if animals at the top of the food chain went extinct, animals at the bottom, such as mice that carried more pathogens, took their place at the top of the food chain.

“Each species has a special role in the ecosystem. If one species takes the place of another, this can have a major impact in terms of disease risk. And often we can’t predict the risk,” explains Alica Latinne of the Wildlife Conservation Society.

Evidence showing a link between the destruction of ecosystems and the increased risk of spreading new infections has led experts to emphasize the importance of the concept of “One Health”.

Wild animal trade

Markets selling wild animals and products from wild animals are another incubator for infectious diseases. Scientists consider it very likely that the SARS-CoV-2 virus that causes the disease COVID-19 emerged in a wild animal market in Wuhan, China.

Spangenberg explains that placing sick and stressed animals in cramped cages is an “ideal way” to create new pathogens, and spread disease from one species to another. Therefore, many scientists have urged the holding of stricter regulations for the wild animal market.

That is also the call of Elizabeth Maruma Mrema, Chief Executive of the Secretariat of the UN Convention on Biological Diversity. He has called for a worldwide ban on wild animal markets. But Mrema also reveals that for millions of people, especially in poorer regions of the world, these markets are a source of income.

Indonesia’s position in the eyes of the world

Indonesia is a country with a very large tropical forest, in COP 26 it was stated that Indonesia is the last bastion of planet earth along with the Amazon and the Congo forests. save a lot of germplasm, Indonesia’s forest area totals 128 million ha. Indonesia is a country with the third largest tropical rainforest in the world. That means, a lot of germplasm stored in it. This will also be a big scourge if the vast forest cannot be maintained properly. The expansion of residential areas, planting of oil palm, clearing land and roads will destroy some of the existing germplasm. Currently, humans have lost 8% of animal species and another 22%. If Indonesia participates in efforts to reduce and destroy the environment intentionally or unintentionally, we can estimate what will happen in the future.

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How do greenhouse gases actually warm the planet?

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Greenhouse gas (GHG) emissions – the atmospheric gases responsible for causing global warming and climatic change – are critical to understanding and addressing the climate crisis. Despite an initial dip in global GHG emissions due to COVID-19, the United Nations Environment Programme’s latest Emissions Gap Report (EGR) expects a strong rebound in 2021, when emissions are expected to be only slightly lower than the record levels of 2019.

While most GHGs are naturally occurring, human activities have also been leading to a problematic increase in the amount of GHG emitted and their concentration in the atmosphere. This increased concentration, in turn, can lead to adverse effects on climate. Effects include increases in the frequency and intensity of extreme weather events – including flooding, droughts, wildfires and hurricanes – that affect millions of people and cause trillions in economic losses.

The Emissions Gap Report found that if we do not halve annual GHG emissions by 2030, it will be very difficult to limit global warming to 1.5°C compared to pre-industrial levels by the end of the century. Based on current unconditional pledges to reduce emissions, the world is on a path to see global warming of 2.7 °C by the end of the century compared to pre-industrial levels.

“Human-caused greenhouse gas emissions endanger human and environmental health,” says Mark Radka, Chief of UNEP’s Energy and Climate Branch. “And the impacts will become more widespread and severed without strong climate action.”

So how exactly do GHG emissions warm the planet and what can we do?

What are the major greenhouse gases?

Carbon dioxide (CO2), methane and nitrous oxide are the major GHGs. CO2 stays in the atmosphere for up to 1,000 years, methane for around a decade and nitrous oxide for approximately 120 years. Measured over a 20-year period, methane is 80 times more potent than CO2 in causing global warming, while nitrous oxide is 280 times more potent.

Coal, oil and natural gas continue to power many parts of the world. Carbon is the main element in these fuels, and when they’re burned to generate electricity, power transportation or provide heat, they produce CO2, a colourless, odourless gas.

Oil and gas extraction, coal mining and waste landfills account for 55 per cent of human-caused methane emissions. Approximately 32 per cent of human-caused methane emissions are attributable to cows, sheep and other ruminants that ferment food in their stomachs. Manure decomposition is another agricultural source of the gas, as is rice cultivation. 

Human-caused nitrous oxide emissions largely arise from agriculture practices. Bacteria in soil and water naturally convert nitrogen into nitrous oxide, but fertilizer use and run-off add to this process by putting more nitrogen into the environment.

What are the other greenhouse gases?

Fluorinated gases – such as hydrofluorocarbons, perfluorocarbons and sulfur hexafluoride – are GHGs that do not occur naturally. Hydrofluorocarbons are refrigerants used as alternatives to chlorofluorocarbons (CFCs), which depleted the ozone layer and were phased out thanks to the Montreal Protocol. The other gases have industrial and commercial uses.

While fluorinated gases are far less prevalent than other GHGs and do not deplete the ozone layer like CFCs, they are still very powerful. Over a 20-year period, the various fluorinated gases’ global warming potential ranges from 460–16,300 times greater than that of CO2.

Water vapour is the most abundant GHG in the atmosphere and is the biggest overall contributor to the greenhouse effect. However, almost all the water vapour in the atmosphere comes from natural processes. Human emissions are very small and thus relatively less impactful.

What is the greenhouse effect?

The Earth’s surface absorbs about 48 per cent of incoming solar energy, while the atmosphere absorbs 23 per cent. The rest is reflected back into space. Natural processes ensure that the amount of incoming and outgoing energy are equal, keeping the planet’s temperature stable,

However, GHGs, unlike other atmospheric gases such as oxygen and nitrogen, are opaque to outgoing infrared radiation. As the concentration of GHGs in the atmosphere increases due to human-caused emissions, energy radiated from the surface becomes trapped in the atmosphere, unable to escape the planet. This energy returns to the surface, where it is reabsorbed.

Since more energy enters than exits the planet, surface temperatures increase until a new balance is achieved. This temperature increase has long-term climate impacts and affects myriad natural systems.

What can we do to reduce GHG emissions?

Shifting to renewable energy, putting a price on carbon and phasing out coal are all important elements in reducing GHG emissions. Ultimately, stronger nationally determined contributions are needed to accelerate this reduction to preserve long-term human and environmental health.

 “We need to implement strong policies that back the raised ambitions,” says Radka. “We cannot continue down the same path and expect better results. Action is needed now.”

During COP26, the European Union and the United States launched the Global Methane Pledge, which will see over 100 countries aim to reduce 30 per cent of methane emissions in the fuel, agriculture and waste sectors by 2030.

UNEP has outlined its six-sector solution, which can reduce 29–32 gigatons of carbon dioxide by 2030 to meet the 1.5°C warming limit. UNEP also maintains an online “Climate Note,” a tool that visualizes the changing state of the climate with a baseline of 1990.

Despite the challenges, there is reason to be positive. From 2010 to 2021, policies were put in place which will lower annual emissions by 11 gigatons by 2030 compared to what would have otherwise happened.

Through its other multilateral environmental agreements and reports, UNEP raises awareness and advocates for effective environmental action. UNEP will continue to work closely with its 193 Member States and other stakeholders to set the environmental agenda and advocate for a drastic reduction in GHG emissions.

Beyond these movements, individuals can also join the UN’s #ActNow campaign for ideas to take climate-positive actions.

By making choices that have less harmful effects on the environment, everyone can be part of the solution and influence change. Speaking up is one way to multiply impact and create change on a much bigger scale.

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The social aspect of biodiversity reduction in Brazil

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What most people ignore is that climate change is also a social issue, arising from unawareness of the human population about the impact of their activities. Biodiversity plays a key role in ecosystems and also services benefits to the tourism industry. Marine life biodiversity specifically plays a role in attracting tourists for activities like scuba diving, snorkeling and other observation activities alike. Currently, the Brazilian Guitarfish, commonly found in the South Atlantic Brazilian waters, specifically around the South coast of Rio De Janeiro is facing massive decline in numbers, and is also on the list of critically endangered species.

One major reason for the rapid decline in numbers of Brazilian Guitarfish is overfishing of the female population for illegal, highly valued meat sale in fish markets. Most fishermen catch the female guitarfish along with their little offspring in shallow waters around Rio De Janeiro. The decline in species of guitarfish is mostly among the female population, however this impacts the long term numbers of the guitarfish population. Fishermen who catch guitarfish and engage in the illegal meat industry know little about the impact created by their fishing activities on biodiversity in the oceans. A valid solution to solving the issue of high levels of guitarfish fishing in Brazil is empowering fishermen to engage in other trades and businesses that are more sustainable with steady profits, simply raising awareness about the downside of overfishing endangered species might not be enough. A dollar is a dollar, or in this case a real is a real.

An alternate model for sustainable fishing has been developed in Fuji, specifically to protect the coastline that attracts tourism across the year. The local government in fishing villages is working in collaboration with fishers to ensure that they have access to a greater number of opportunities, even outside the fishing industry. Moreover, the local government is regulating the prices of fish meat and creating a bandwidth for sustainable profits by encouraging fishing of species that are more abundant in the local waters. This is creating a low incentive situation for Fujian fishers to fish endangered species and engage in local trade. This unique model, with a mix of government involvement and local incentives, can be amplified to other countries like Brazil too.

While most experts talk about climate change, they ignore the social aspect of climate change, which is perhaps the biggest contributor. Human activities impacting climate change don’t just arise from unawareness but also from lack of other opportunities that can incentivise a change in decision making. Creating consumer end awareness about the downside of consuming illegal meat is also crucial. The same can be done in fish markets with the use of artwork to support behavioral change. Brazilian Guitarfish also carry high content of Mercury and chemicals and are therefore not the safest to consume in the unregulated illegal meat industry, without safety approvals from the government. Making consumers aware about the fact that they are not just paying high prices for meat that is illegal but also consuming meat that can potentially give them cancer and other diseases is crucial. This can be done using artwork in fish markets, as is being done across fishing villages in Bali.

Brazilian Guitarfish are also rare in other parts of the world and attract divers to premium diving locations, fetching around $75 to $100 per dive, higher than most other locations where rare species like Guitarfish cannot be spotted. More efforts can be taken to set up dive centers in Brazil specifically dedicated towards Brazilian Guitarfish. This will not only be an attractive source of income for locals but also encourage conservation efforts. Tourism can be a major source of revenue for Brazilian fishermen and farmers, encouraging development and infrastructural promotion across major cities in Brazil, thereby creating a line of opportunities for Brazilian citizens across different industries.

With biodiversity as high as Brazil, more efforts should be taken to fuel tourism, interaction and awareness with Brazilian biodiversity, including rainforests and marine life. With the empowerment of local communities, we can together create a more sustainable future, inclusive towards all organisms.

To promote the cause of Brazilian Guitarfish conservation, I have started a movement called The Brazilian Guitarfish movement, operating via  whatsapp group involving people across continents from various fields – climate researchers, marine conservationists, scuba divers, fishing industry experts, government authorities, public policy enthusiasts and tourism officials to curate solutions specific to conserving Brazilian Guitarfish. It’s a global initiative, with hands contributing from across the world to save Brazilian Guitarfish by empowering local fishers with diverse opportunities. There is always an alternate solution, sometimes all we need is a fresh approach along with fresh minds to find it. Fortunately, connecting globally in the digital world makes problem solving  easier for all of us.

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