Article 6 and carbon markets

Market-based cooperation, enabled by Article 6 of the Paris Agreement, can contribute to achieve countries’ national climate action strategies. It can play an important role to channel funds for the implementation of climate mitigation to achieve Nationally Determined Contributions (NDCs) and raise mitigation ambition. In addition, market-based cooperation can contribute to adaptation, attract climate finance, promote technology transfer and capacity building. On the international level, provisions for market-based implementation and cooperation were first introduced with the Kyoto Protocol’s Joint Implementation (JI), International Emissions Trading (IET) and Clean Development Mechanism (CDM). Under the Paris Agreement, Article 6 establishes guidance for reporting, accounting, and tracking of international market-based cooperation (Article 6.2), as well as a successor to the CDM, the A6.4 Mechanism (Article 6.4). Furthermore, it establishes a framework for non-market based approaches (Article 6.8), The information note dives deeper into what Article 6 of the Paris Agreement entails, emphasising the critical importance of developing a robust project pipeline and advocating for upfront finance.

Engaging in Article 6 requires strategic decisions about how to comply with the international participation requirements and to define what an effective and comprehensive participation in Article 6 means for the country. Consequently, understanding the national starting point is a fundamental initial step when engaging in Article 6. Active participation in Article 6 necessitates close collaboration with project developers, international partners, including buyers and providers of technical assistance, as well as other relevant stakeholders.

Participation in Article 6 requires establishing appropriate processes and procedures, including for authorisation, registering activities and mitigation outcomes as well as for reporting purposes. To establish such procedures, countries may leverage existing structures and processes, refining them in line with their national priorities and circumstances, all the while ensuring compliance with Article 6 participation requirements.

As West African countries progress towards Article 6 readiness, they need to seize opportunities to effectively source and develop carbon market activities. This page points to different approaches, through which impactful projects can be identified and developed over time. It provides orientation to ensure the alignment of activities with NDC targets, provides insights on contractual structures and relevant links to make well-informed decisions regarding credit pricing.

Navigating the international carbon market landscape is rendered more complex by the number of acronyms and terms in use. These stem from the extensive and multifaceted nature of agreements, institutions, and frameworks involved in addressing global mitigation efforts. This acronym-rich environment requires stakeholders to familiarise themselves with a diverse array of terms, reflecting the comprehensive and nuanced nature of international efforts to combat climate change. You can find a list of acronyms used in the West African Alliance Article 6 Blueprint by clicking on the button below.

• The landscape of Article 6 implementation
• CO28 Digest: Relevance of Key Outcomes for Carbon Markets Implementation in Africa
• Implementing Article 6 – An Overview of Preparations in Selected Countries
• Article 6 readiness in West Africa: Scoping Study
• Article 6 Piloting: State of Play and Stakeholder Experiences