COP29 Finalizes Article 6, Unlocking Trusted International Carbon Markets

The COP29 Presidency has announced a major breakthrough in climate diplomacy: the full operationalization of Article 6 of the Paris Agreement, which unlocks international carbon markets after years of stalled negotiations. The dual-track strategy employed by the Presidency bridged both technical and political divides, ending a decade-long deadlock and enabling transparent, trusted carbon markets designed to enhance global cooperation on climate goals.

Article 6 represents a critical tool for keeping the 1.5-degree Celsius climate target within reach, as highlighted by COP29 President Mukhtar Babayev. “Climate change is a transnational challenge, and Article 6 will enable transnational solutions. Because the atmosphere does not care where emissions savings are made,” Babayev noted during the announcement.

The operationalization of Article 6 could save up to $250 billion annually by enabling trusted carbon markets that reduce the costs of implementing national climate plans, also known as Nationally Determined Contributions (NDCs). Parties are encouraged to reinvest these savings to further enhance their next NDCs, which is seen as pivotal to keeping the 1.5-degree target achievable.

The breakthrough was achieved by resolving a decade-long stalemate that had previously delayed mechanisms vital for international collaboration. COP29’s strategy involved early adoption of Article 6.4 standards and fostering consensus among participating countries, culminating in unanimous decisions that ensure environmental integrity, transparency, and inclusivity in carbon markets. COP29 Lead Negotiator Yalchin Rafiyev added, “Today, we unlocked one of the most complex challenges in climate diplomacy. Article 6 means coal plants decommissioned, wind farms built, and forests planted—a wave of investment in the developing world.”

With Article 6 now fully operational, parties can use the savings from reduced implementation costs to invest in greater climate ambition, coming just in time for the next generation of NDCs due in February. These NDCs are considered “make-or-break” for global climate targets, emphasizing the importance of enhanced climate action. The guidelines adopted today will evolve as countries and project developers gain experience, ensuring that practical, inclusive solutions continue to advance while respecting human rights and supporting sustainable development.

The COP29 Presidency praised the nearly decade-long effort to operationalize Article 6, describing it as a pivotal step towards establishing robust, high-quality carbon markets that can unleash global climate investment. “This consensus is the result of nearly a decade of tireless work,” noted the COP29 Presidency, “marking a pivotal step toward robust, high-quality carbon markets that unleash global climate investment.”