Negotiations on cooperative mechanisms (Article 6)

Negotiations on cooperative mechanisms (Article 6)

The Paris Agreement establishes a new set of mechanisms for voluntary cooperation between countries in Article 6 of the Agreement. At first glance, this includes the familiar looking mechanism for mitigation and sustainable development, a centrally governed mechanism that generates verified emission reductions (Article 6.4). It also gives space to countries for developing their own bottom-up approaches known as cooperative approaches, through which countries can transfer mitigation outcomes internationally (Article 6.2). Lastly, Article 6.8 establishes a framework for non-market approaches. Binding these approaches together is the overarching goal of Article 6.1, which links international cooperation to higher ambition in mitigation and adaptation activities and the promotion of sustainable development and environmental integrity.

Presumably, with the expectation of a longer lead time until the Paris Agreement enters into force, Parties decided that the operational rules for all three approaches would be adopted during the first session of the “Conference of the Parties serving as the meeting of the Parties to the Paris Agreement” (CMA1). The first session is now projected to take place in 2017, if not already this year in Marrakech. Negotiations will have to drastically pick up speed in order for the mandate to be met. When Parties met earlier this year in Bonn for the intersessional negotiations (SBSTA 44), it quickly became clear that progress on operationalizing Article 6 would not be rapid. Anyone, who expected further clarity from the Bonn negotiations on what the future mechanisms would look like, would have been disappointed. Rather, the session was split between Parties articulating their understanding of what Article 6 says and procedural discussions. Especially developing countries wanted to keep the discussions “Party-driven” and were careful not to engage the technical support of the Secretariat until agreement on the political priorities had been reached. Correspondingly, SBSTA 44 resulted in a call for submissions on all three approaches of Article 6. Parties and accredited observers are expected to submit their views on how Article 6 shall be operationalized by 30 September 2016. 

The task Parties have at hand in implementing the new approaches is on the one hand simple due to the vast experience with carbon markets, particularly the Clean Development Mechanism (CDM) and Joint Implementation (JI). It is at the same time complex because some countries want the new approaches to fundamentally differ from the cooperation mechanisms of the past. Decentralizing approaches and giving less authority to the UN regulator, strengthening the environmental credibility of carbon markets, and enhancing their operational and transformational effectiveness are underlying the desire for change. Another fundamental difference is the introduction of Nationally Determined Contributions (NDCs) for all countries, which begs the question of how transfers of mitigation outcomes are to be accounted for. This points to another complexity in operationalizing the carbon markets of the future: the linkage to other Articles of the Paris Agreement, in particular the accounting of NDCs (Article 4 and 13), and the relationship with the global stocktake (Article 14) that would consider the role of international cooperative mechanisms in increasing overall ambition. 

The new framework for non-market approaches (Article 6.8) remained a question mark for many Parties in Bonn. Aside from the general agreement that the new framework should not duplicate institutions already created under the Convention but promote linkages and synergies between existing ones, there continues to be widespread uncertainty over how to fill the non-market approach with life. It will be interesting to see if the submissions from Parties can inject some new ideas into this discussion. 

At COP 22 in Marrakech, Parties are likely to focus on crystallizing key priorities or questions for which the answers would then be negotiated after Marrakech. While the original deadline for operationalizing Article 6 is unlikely to be met, there is time pressure if the negotiations want to stay relevant for the actual carbon markets being developed in the world today. This is particularly true for the new centralized mechanism of Article 6.4, which is already in competition with other carbon standards for consideration by domestic or international offsetting scheme. Most notably, if the new mechanism is to play a role in offsetting emissions from aviation, its rules should be tangible before the International Civil Aviation Organization (ICAO) decides on its market-based mechanism in 2018.


Sandra Greiner is a member of the Gambian delegation to the UNFCCC and has worked with African negotiators in the CDM reform and negotiations of Article 6 since COP 19 in Warsaw.