April 2016 – To the surprise of many, the negotiations at the Paris Climate Summit ended with a general agreement on the use of international cooperation mechanisms, enshrined in Article 6 of the Paris Agreement (PA). While not explicitly mentioning Carbon Markets, Article 6 enables market-based approaches in several ways, covering the needs of all Parties in engaging in international cooperation. One distinct new feature is that the cooperative approaches are open to all Parties for use on a voluntary basis.
This issue of the Carbon Mechanisms Review describes and analyses the Paris outcome with respect to its Carbon Market provisions. The authors analyze ways to operationalize Article 6.4 and describe the way Japan's intends to use its Joint Crediting Mechanism under Article 6.2. In the opinion column, the way the Sustainable Development could be taken up under the new Paris market approaches is reflected upon. This is followed by an analysis of principles and safeguards ensuring environmental integrity of the new mechanisms. Subsequently, the Paris Agreement and its Carbon Market provisions is reviewed by the private sector. Last not least, the issue features an analysis on how Article 6.4 could benefits from the lessons learnt from the CDM, and especially its programmtic approach.