By Mathew Carr
A powerful Saudi Arabia official and member of the board supervising a new global carbon market warned that newly-approved rules might eliminate important types of carbon credits from the market, angering industry.
The 6.4 supervisory body on Friday approved a “common-practice tool” designed to make sure carbon credits are created only by projects that do something for the climate over and above common practice …ie the projects must make additional effort beyond business as usual.
The officials at a supervisory meeting today in Bonn, Germany, are seeking to tread a line between encouraging big investments in clean tech (including carbon removal such as CO2 capture) supported by the new UN Paris carbon market…without flooding that market with too many credits.
Tech-based removals are seen by industry, especially the fossil-fuel industry, as a key opportunity in the climate transition away from fossil fuels. Some depleted oil and gas fields might be restocked with CO2.
It’s concerning for the climate that, 10 years after the Paris carbon market was supposedly created, big differences among officials seem to be holding up supply of and demand for UN carbon credits.
The market is not yet really operating. UN climate talks are taking place next month in Brazil to speed emission reductions because heat-trapping gas in the atmosphere is at unprecedented levels in human history and causing death and destruction around the world via wild weather.
As the tool was being approved today, Maria Aljishi (deputy chair of the board) asked the following:
“Are we now agreeing that the common practice tool is going to be excluding tech-based removals from their ability to participate in the 6.4 mechanism?
“Is that really what we’re just agreeing to? ….I feel like I’m misunderstanding.
“So if perhaps the (UNFCCC) Secretariat could explain how that would work, because I think perhaps that’s not what we want…. is to move forward without such an explanation and then receive 120 or more [120 submissions? CarrZee inference in square brackets] as a reaction from stakeholders. So can we have some clarity?”
[While I’m pointing out Aljishi’s context and her potential conflicts of interest … board members are meant to act in the interests of climate protection, not their home country (I removed some earlier garble from this paragraph). I’m not inferring Aljishi is doing anything wrong, nor that the board is doing something wrong by approving the tool. I do question whether this new tool is even necessary. See this chart immediately below and the full document, further below as a note].
She had also said:
“If it’s a barrier for entry [into supplying the market with credits], keeping in mind that no tech-based removal registered under Clean Development Mechanism (the previous UN carbon market), because there was a barrier, a significant one under CDM, and they struggled to overturn or really nudge the supervisor ….or the board [CDM executive board]….to make decisions that would eliminate the barrier to entry for tech-based removals … let’s have a time-bound paragraph that mandates the MEP [6.4 Methodological Expert Panel] to come back with that analysis as soon as possible, so that we may move forward, without angering [a lot of people and industries….CarrZee inference in square brackets].”
The board is seeking to ally Aljishi’s concern by requiring the MEP to act quickly [I’m not sure how quickly].
The bottom line
CarrZee: Expensive projects that capture CO2 from the air or from fossil fuel systems probably won’t choose the UN Paris carbon system to create credits to sell.
They will use voluntary/other markets, where prices can be more than €100 ($116) a ton.
At the moment, markets indicate UN (airline-industry/Corsia) credits at $20 a ton (ICE Futures Europe).
Credits already must demonstrate they are from projects additional to what would have occurred without the carbon finance.
So the debate above and the new tool seem … a little …. time wastey… right now. Perhaps that’s the idea…to further delay effective climate action. Then the climate crisis will worsen, the world will be forced to buy even more expensive carbon credits created by reckless countries such as Saudi Arabia and the USA, not the people of those nations but the so-called leadership of them….who seem focused almost purely on money …. instead of on true sustainability and risk management.
[Email mathew@carrzee.net with feedback and to give your view. Updated with context and bottom line section, smoothed]
NOTES
