The German government has published a new position paper that highlights important basic principles for action on the voluntary carbon market and embeds it politically in the global carbon market. In this paper, the German government emphasises the priority of avoiding and reducing greenhouse gas emissions over offsetting emissions. At the same time, it emphasises the role of environmental and social integrity in the purchase of CO2 certificates, which must be guaranteed by rigorous quality criteria.
In order to guarantee these qualitative aspects, the German government aims to ensure that all international market activities are registered under Article 6.4 as far as possible. By involving national governments in Art. 6.4 market activities, capacity for national, mandatory carbon pricing instruments in developing countries can be built up at the same time (e.g. strengthening national emissions inventories) and thus further advance the transformation.
When utilising international carbon markets, the German government calls for the interaction of market players to be aligned with the goals of the Paris Agreement so that this leads to an increase in global ambition and advances the necessary transformation to net greenhouse gas neutrality. Qualitative requirements must be met on the supply and demand side of the market so that the voluntary carbon market contributes to driving decarbonisation and green growth as well as to reducing the investment gap to mitigate climate change.
Credits generated from projects must come from a high-quality certification system, the reductions must be additional and go beyond the host country’s own committed mitigation contributions. In addition, correct accounting, permanence as well as environmental and social integrity must be ensured.
On the demand side, the use of the voluntary carbon market should not lead to companies' emission reduction efforts being replaced or delayed. Companies and organisations are advised to develop and implement robust, science-based, short- and long-term climate action strategies to reduce their own emissions in the short- and long-term.
Download
You can download the position paper here.
Further information
Details on the implementation of ‘compensation projects’ can be found in a UBA guidebook