The United Nations Development Programme (UNDP) today launched a new initiative at COP28 to support developing countries’ access to carbon markets, mitigate social and environmental risks and promote accurate carbon accounting.
Carbon markets, both compliance and voluntary, are trading schemes that create financial incentives for activities that reduce or remove greenhouse gas emissions.
In these schemes, emissions are quantified into carbon credits that can be bought and sold. One tradable carbon credit equals one ton of carbon dioxide – or the equivalent amount of a different greenhouse gas – reduced, sequestered or avoided. This could be by reducing deforestation or by capturing and burning methane gas from landfills to generate electricity.
Carbon markets provide a path for developing countries to bring low carbon technologies to their countries and to raise significant private capital – potentially billions of dollars – to support their climate action. However, carbon markets have been plagued with controversy including concerns related to double counting of greenhouse gas emission reductions, human rights violations, and greenwashing.
The initiative seeks to address these concerns, while promoting the positive impacts this type of financing can produce when done correctly. The launch marks a turning point in UNDP’s efforts to bring the principles of environmental and social integrity into practice.
“Carbon markets can help unlock the trillion-dollar gap that is needed for developing countries to carry out their climate action pledges. But they cannot and should not be used to the detriment of climate impact, indigenous communities and human rights.
This initiative represents a pioneering approach, emphasizing integrity of carbon credit supply, equity for host countries, farmers, households, and rights-holders, including Indigenous Peoples, local communities, and women” noted Achim Steiner, UNDP Administrator.
High integrity is at the core of UNDP’s work in this area to ensure emission reductions and removals are real, have verifiable climate impacts, and are aligned with countries’ broader climate action pledges – and supportive of higher ambition.
“Carbon markets can support environmental sustainability, foster human rights and improve economic development, especially in communities most impacted by climate change, but only if they are aligned with
the Paris Agreement goals. For this to happen, we need increased reliability and transparency” added Cassie Flynn, UNDP Climate Hub Director.
UNDP will focus on integrity on both demand and supply sides and the generation of high-quality carbon credits to level the playing field for host countries.