Why should land managers be interested in article 6 of the Paris Agreement?
Article 6 of the Paris Agreement allows countries to voluntarily cooperate with each other to achieve emission reduction targets. Under this article, a country is be able to transfer carbon credits earned from the reduction of GHG emissions to help another country to meet its climate target.
Broadly speaking, carbon markets have evolved in the last 25 years as a space where actions toward reducing the climate footprint are traded, including financing industries to move toward less contaminating production processes or paying off projects that contribute to sequestering carbon, the latest known as carbon offsetting. These markets can be clearly separated into two types. From one side we have the mandatory (compliance) markets, generally organized under an Emission Trading System (ETS) like the European Cap-and-Trade system, and affecting high emitting sectors based on fossil fuels. From the other side we have the Voluntary Carbon Markets (VCM), which, as the name suggests, are not mandatory and appeal to organizations and citizens that are willing to take voluntary steps toward reducing their carbon footprint.
Historically, ETS have dominated the scene by interest and volume, with VCM mobilizing only a very small percentage of the resources generated. However, two relatively recent developments are contributing to change this. Firstly, an increased social pressure and climate understanding are pushing corporations to commit to emission reduction targets, generally known as Net-Zero by 2050 policies, which brings signatories to deploy a number of actions for both reducing their footprint internally, and buying carbon offsets to compensate for what they can not reduce. The second development is the emergence at COP26 of a rulebook to make operational Article 6 of the Paris Agreement, which provides the framework to manage and promote VCMs. Article 6 has been there for long, but only with these guidelines it is now possible for financial institutions to move in the voluntary space with confidence.
Why is this important? Thanks to these two developments, the interest in VCMs is growing, and the industry is trying to build as quickly as possible an infrastructure that can be used to operate these markets with the required transparency and credibility. We can expect these processes to really open up the voluntary markets within the next 2 to 3 years. By then, an enormous amount of resources could be made available to project and technology developers to actually sequester carbon and restore the required ecosystem balance. To be able to seize these opportunities, developers need to be able to demonstrate in a sound and harmonized way the actual impact their work will be having. From the perspective of the project Farms4Climate and its stakeholders, it is therefore vital to be able to provide science-based data on the carbon-sequestration capacity of the regenerative practices that are being validated, and offer an easy means to monitor the potential impact these farming approaches could have if scaled out. Fulfilling the project's goals will contribute to vehicle resources toward an actor typically left behind: rural smallholders, which could have an even greater social than environmental impact.