Thread by @mattadamw

If you enjoyed y'day's #Article6 thread, strap in for the sequel.

There's some changes, but still a tale of potential 💰 for 💩 carbon credits.

🧵 ↓

#COP27

For a quick refresher on what Article 6 is and why it matters, see y'day's 🧵

https://twitter.com/mattadamw/status/1593114612722847744

My headline takeaway from the new versions of the texts out overnight:

Some improvements and changes. There is a signal that emissions reductions that can be double counted shouldn't be used as carbon credits/offsets. But it's only a signal.

Whole framework could lead to junk credits (which can be counted more than once) used on a sub-prime market for carbon.

We know many companies clamouring to get on such a market. The amounts of carbon we're talking and of 💰 may be very large.

This could all lead to lots of carbon credits that don't benefit the climate much (or at all) that are counted more than once, thereby effectively cooking the books on cutting emissions.

So, what's the detail? ↓

New texts were published overnight. These are not final, but they are close.

In Article 6.4 there are 8 [ ] remaining, plus some "Options" in the text.
In Article 6.2 none remain.

Article 6.2: unfccc.int/sites/default/…

Article 6.4: unfccc.int/sites/default/…

First, Article 6.2

If countries want to keep information on carbon credits confidential (correction cp to y'day: more grounds like national security, not commercial sensitivity) now they only "should" justify why (not "shall).

Any info can be confidential - no restrictions on it.

But further work on confidentiality is requested - so it could be changed/further qualified.

Now Article 6.4

Most important thing is that "not authorized" emission reductions are now "mitigation contribution" emissions reductions.

This is an important signal - it implies they should not be used (e.g. by companies) to count towards a target, but should be a way of them funding climate action, by buying the credit, but without using it to offset their own emissions.

But this name might be red herring.

Ultimately Article 6 can't prevent this from happening. And in text it lists some possible uses of these "mitigation contribution" reductions, but it doesn't exclude any or suggest that any should be off limits - a missed opportunity perhaps.

This matters because in Glasgow it was decided that only authorized emissions reductions would be subject to "Corresponding Adjustment" - this is what prevents their climate benefit being counted more than once, which is cheating.

There is also a v technical piece in 6.4. It presents options around whether SOP and OMGE apply only to authorized credits or to mitigation contribution ones as well.

Just to break this down for a sec:

SOP (Share of Proceeds) is taking 5% of emissions reductions and putting them aside so as the finance can be used to help developing countries with climate adaptation costs.

OMGE (Overall Mitigation in Global Emissions) is helping to ensure that this carbon market drives greater carbon cuts over time by reducing the number of credits on the market. This will move the needle a little and/or account for a bit of margin of error...

i.e. if a project doesn't generate exactly the same emissions savings as expected this can help account for that.

But Option 2 and 3 in the text (this is paras 41-46) would give "mitigation contribution" emissions reductions a free pass on SOP and OMGE, even though they may be used as carbon credits and offsets on the private market.

Elsewhere, on emissions removals there will now be a consultation with parties and with observers.

Removals are important because they might rely on nature & land to take carbon out of atmosphere.

But there's only so much land - and countries are overestimating how much they can use to meet emissions targets.

This could impact nature & wildlife, human rights/indigenous peoples, food security.

This consultation on removals invites views on their potential impact on the rights of indigenous peoples, migrants, persons with disabilities, children, women and others.

This is new language and responds to concerns of some parties on human rights impacts of removals.

Avoided emissions will still be further considered. This matters because avoided emissions can be very hard to prove (avoided deforestation) and can include activities such as not using fossil fuels.

We need to stop using fossil fuels anyway - so creating a carbon credit & claiming additional benefit to atmosphere based on that is a bit silly.

Historic carbon credits from an old scheme (Clean Development Mechanism) can still be used.

Many of these credits are dodgy - they are for renewable projects that would probably have happened anyway (again, you can't build a carbon offset/credit on that).

But *now* they can only be used for any country's *first* NDC (its emissions cut pledge to 2030). This helps, because the climate benefit (if there was any) is in many cases historic, so there needs to be a sunset on continuing to count this as a benefit and credit.

Clarification on REDD+, which is mentioned in the draft cover text of #COP27 in relation to Article 6:

REDD+ is about avoided deforestation which then provides emissions reductions (i.e. stops an existing source of emissions) - not an avoided emission as I may have said y'day.

But proving that deforestation has been avoided is very hard - that forest was going to be cut down but now it won't be has already led to lots of issues under UNFCCC including how land emissions are accounted for.

Many forests are always at risk of being cut down, or being lost to wildfires (esp. due to increasing climate change) and therefore the permanence of carbon saved through avoided deforestation under REDD+ is questionable (like removals, which rely on nature).

Some countries with forests are pushing for this mention of REDD+ and Article 6, and they want to see avoided deforestation under REDD+ since 2016 to count.

This would go against principle that carbon benefits must be since 2021.

Think that's a wrap, but A6.4 at least may still see further iterations of the text.