(14 November 2024 – Azerbaijan) Countries at Baku COP29 climate summit assented to carbon credit quality standards which are critical to launching a United Nations (UN) backed global carbon market to collaboratively fund CO₂ reducing projects.
The agreement includes a dynamic mechanism to update the standards, marking a critical step toward concluding Article Six negotiations establishing framework rules for international carbon crediting projects.
The deal could pave the way for a long sought after UN-backed global carbon market to launch as soon as next year.
Demand for carbon credits has weakened this year as large enterprises pivot to direct emission reductions.
“It is a game-changing tool that could help save up to US$250 billion annually in climate plan implementation costs. Following years of stalemate, the breakthroughs in Baku have now begun” stated COP29 Lead Negotiator Yalchin Rafiyev.
“Climate impacts are carving up to five percent off GDP in many countries. The climate crisis is a cost-of-living crisis. Worsening climate impacts will put inflation on steroids unless every country can take bolder climate action” said UN Climate Change Executive Secretary Simon Stiell.
“While clean energy investments are expected to reach US$2 trillion this year, these investments remain concentrated in a few major markets. There is an urgent need to expand climate financing to developing nations as ‘global inflation insurance’.”