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Wednesday, July 28, 2021

Carbon market: Talks in Madrid go nowhere

Countries like India, China and Brazil want their unsold carbon credits to be valid in the new market while the developed countries are opposing it on the ground that many of these credits were bogus and did not represent actual emission reductions.

Written by Amitabh Sinha
Madrid | Updated: December 10, 2019 9:55:43 pm
madrid climate talks, prakash javadekar, paris climate agreement, india carbon emission, climate change, kyoto protocol Prakash Javadekar, Union Minister of Environment, Forest and Climate Change, delivers his address at COP25 in Madrid on Tuesday. (Source: PIB)

Negotiators at the Madrid climate talks finally threw up their hands on the contentious issue of setting up a new carbon market under the Paris Agreement, and requested their political leaderships, the ministers, to take charge and try to resolve the differences at their level.

With practically no progress on any of the big disagreements on the subject, it is unlikely that even the ministers would be able to resolve the many complicated details over the next two days. That would most likely result in the issue being pushed yet again to the next conference. Carbon markets was supposed to be finalised, along with other sections of the Paris Agreement rule book, at the Katowice meeting last year. But while the rest of the rulebook was agreed upon, carbon markets was left to be decided at this year’s conference.

Negotiators were huddled till late at night on Monday, and in to the early hours of Tuesday, in the discussions of one of the technical groups that was supposed to finalise an agreement on the carbon markets. But when it finally wound up its work, the technical group could only deliver a heavily bracketed text, each bracket representing the different options on the table, and reflecting the disagreements on each one of them.

Carbon markets allow the buying and selling of emission reductions in the form of carbon credits, and enable countries struggling to meet their climate targets to buy these credits from countries that are in a position to reduce their emissions beyond their own targets. Such a carbon market existed under the 1997 Kyoto Protocol as well but that regime is coming to an end next year. The current negotiations are about creating a similar market under the successor Paris Agreement regime.

The big disagreement is over the transition of unsold carbon credits from the Kyoto regime to the new market. Countries like India, China and Brazil want their unsold carbon credits to be valid in the new market while the developed countries are opposing it on the ground that many of these credits were bogus and did not represent actual emission reductions because the monitoring and verification mechanisms under the Kyoto Protocol were not very robust.

There are strong disagreements over a number of other provisions as well and none of these have been ironed out. Both sides say they would prefer ‘no deal’ over a ‘bad deal’ on carbon markets.

The talks on an “enhanced transparency framework”, which is about developing common metrics and timeframes for reporting climate actions and emissions data, also broke down. China, supported by India and some other countries, blocked a proposal for extending the negotiations on this issue, saying disproportionate attention was being accorded to issues like these while other subjects like unkept pre-2020 promises by developed countries, transfer of technology and finance, and loss and damages were not getting adequate time.

Meanwhile, the high-level segment of the Madrid talks began on Tuesday with ministers making their country statements. A number of countries, especially the most threatened ones like small island states, urged the big emitters to increase their climate actions in light of scientific assessments that show that the present level of climate actions was not enough to prevent the extreme impacts of climate change.

India’s Environment Minister Prakash Javadekar once again argued that it was important to focus on the implementation and delivery of the current targets rather than just make promises about the future.

“Let us concentrate on implementation of Paris Agreement and not digress,” he said in his address.

He highlighted all that India was doing to fight climate change and urged the other countries to also fulfill their past and current targets.

“Only six countries are on track to meet their NDCs (nationally determined contributions) announced in Paris. We are leading the pack,” he said, referring to the climate targets that countries had set for themselves during the run-up to the Paris climate change conference in 2015.

India has reduced (its) emissions intensity (emissions per unit of GDP) of GDP by 21 per cent and is on track to achieve the goal of 35 per cent emissions intensity reduction as promised in Paris. Prime Minister Narendra Modi announced 175 GW target for renewables under the Paris Agreement. We have already achieved 83 GW. Prime Minister has subsequently increased the target to 450 GW at the recent UN Climate Action Summit. We are simultaneously progressing on solar, biomass, and wind energy,” he said.

“We have put carbon tax on coal production at the rate of USD 6 per tonne… The headline is that a commercial flight (in India) was operated on 100 per cent biofuel, and we are targeting blending of 20 per cent ethanol in petrol by 2030. We have leapfrogged from Bharat Standard IV (vehicle fuel emission norms) to Bharat Standard VI for vehicle emission norms and from April 1, 2020, all vehicles will be BS-VI compliant,” he said.

“360 million LED bulbs have been fitted in homes and 10 million conventional streetlights have been replaced with LED lights… We have promised creation of additional carbon sinks of 2.5 to 3 billion tonnes of carbon dioxide equivalent through increasing green cover. In the last five years, our green cover has increased by 15,000 square km… India will be investing about 50 million dollars in water conservation. India has taken up a target for restoration of 26 million hectares of degraded land by 2030… This is the largest programme in the world to ensure carbon sink in land resources,” Javadekar said.

Javadekar said it was unfortunate that the developed countries which had greater resources and had the main responsibility to take climate actions were not doing enough.

“It is time for reflection and assessment as we near the end of pre-202 period. It is time to look in the mirror. Has the developed world delivered on its promise? Unfortunately, annexed countries (the rich and industrialised countries mentioned in the annexes of UN Framework Convention on Climate Change) have not met their Kyoto Protocol targets. Neither their NDCs (under the Paris Agreement) reflect ambitions nor have they shown willingness to enhance their commitments,” he said.

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