Features and Implications of NDCs for Carbon Markets – Final Report

This comprehensive report maps out issues that need to be resolved to engage voluntary cooperation under Article 6.2 of the Paris Agreement. It identifies features and implications of countries’ nationally determined contributions (NDCs) that are particularly relevant to the design and use of carbon markets in the context of Article 6.2. The report is structured around the relationship of three key factors: NDC features, accounting for NDCs and internationally transferred mitigation outcomes (ITMOs), and generation of mitigation outcomes. The report, by Climate Focus, Koru Climate and Perspectives, concludes by discussing possible directions that may be taken in the CMA guidance and suggests areas where reaching an early understanding among countries could help unlock further negotiations.

This report was commissioned by the Swedish Energy Agency (SEA), the Federal Ministry for the Environment, Nature Conservation, Building and Nuclear Safety (BMUB) of Germany, and the Federal Office for the Environment (FOEN) of Switzerland.