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Urban market approaches under Article 6 of the Paris Agreement – Recommendations for practical implementation

Photo by Markus Spiske on Unsplash

Background and Objective

Urban areas are estimated to currently emit over 70% of global energy-related greenhouse gases. A further 50% increase is predicted by 2050, with developing countries accounting for an estimated 89%.. Urban structures nonetheless offer considerable reduction potential in a variety of urban sub-sectors and urban activities. The potential is greatest in fast-growing countries with high rates of urbanisation, where decisions about future infrastructure and viability are being made today. This includes many cities in Africa – the continent with the highest projected rate of urbanisation in the world. At the same time, the GHG-reduction potential is often difficult to exploit due to urban structures, types of emission sources and financial barriers. The carbon market mechanisms under Article 6 of the Paris Agreement provide new incentives for mitigation activities and have the potential to contribute towards implementation of urban climate protection activities on a large scale.

Against this background, the Federal Environment Agency (UBA) commissioned a research project jointly conducted by the Perspectives Climate Group and ICLEI. The project focuses on conceptualising an innovative framework for potential urban Article 6 projects in two African cities: Addis Ababa (Ethiopia) and Kampala (Uganda). The aim is to develop concrete approaches for small-scale urban Article 6 activities based on existing and planned activities and policies. Further, the project seeks to develop potential organisational structures to ensure that all relevant stakeholders are properly involved and that the economic incentives for Article 6 activities are both precise and effective.


The first part of the study involves determining the status quo in the two cities, including urban emissions profiles and mitigation targets, experience with carbon markets and urban climate protection policies, both existing and planned. In a second step, the team identifies key players and stakeholders as well as their potential roles in future urban Article 6 activities. Based on those findings, an analysis will be conducted of the organizational options for urban Article 6 activities relative to the targeted urban sub-sectors. In that analysis, approaches developed in a previous UBA study will be reviewed and discussed in terms of their feasibility for use in Addis and Kampala. Urban case studies covering the relevant urban sub-sectors – such as private and public buildings, waste, and electromobility – will then be selected to illustrate four “urban Article 6 profiles”. As a final step, concrete organisational recommendations will be developed for the case studies.

Milestones and Outlook

As of mid-2021, the project team had analysed the current situation regarding urban emissions and mitigation activities in Addis and Kampala, including past experiences and relevant policies, both existing and planned. They had also started work on identifying key actors and stakeholders for urban Article 6 activities in both cities.

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