Participants in the United Nations Climate Change Conference (COP29) in Baku (Azerbaijan) reached an agreement on Saturday on the rules of a global market for the purchase and sale of carbon credits reduce greenhouse gas emissions after nine years of negotiations and amid intense discussions for a final agreement, late into the night.
States have not been able to agree on this issue since the approval of the Paris Agreement in 2015 amid immense doubts about the reliability of this system. “Article 6 of the Paris Agreement will establish transparent, high-quality carbon markets through which countries and companies can work together to achieve your climate goals. In addition, it could save up to $250 billion per year in the implementation of national climate plans,” the COP presidency announced in a statement.
“Carbon credits” are created through projects such as the plant trees or build wind farms in a poorer country, they receive a credit for each metric ton of emissions they reduce or absorb from the atmosphere. In turn, countries and companies can purchase these credits to help them achieve their climate goals.
This approval, however, comes in the middle of an extremely delicate moment at COP29, after developing countries they will get up from the negotiating table amid disputes over how much climate aid funding to receive from wealthier countries.
According to BBC sources, the dispute over the amount of direct funding for climate aid is at the heart of the problem. Rich countries have proposed, according to the latest draft, around 300 billion dollars every year in the final hours, but the group is asking for $500 billion. The negotiators present in Baku have noted a certain rapprochement in recent hours during the plenary session organized by the president of COP29, Azeri Minister of Ecology Mukhtar Babayev, but they are still taking nothing for granted, according to DPA.
Agreement on the loss and damage fund
Likewise, COP29 also specified a guarantee for the full implementation of the so-called Fund for losses and damageslong awaited by developing countries, including small island states, least developed countries and African nations. The creation of the Loss and Damage Fund was agreed at COP27 held in Egypt and aims to “provide financial assistance to countries most vulnerable to the impacts of climate change”.
To date, the total financial support pledged to the Fund exceeds $730 million (around 700 million euros). Thanks to these achievements, “the Loss and Damage Fund will be able to start financing projects from 2025,” announced the Azeri presidency of the COP.
