Previous Year Question
Consider the following statements:
Statement I: Article 6 of the Paris Agreement on climate change is frequently discussed in global discussions on sustainable development and climate change.
Statement II: Article 6 of the Paris Agreement on climate change sets out the principles of carbon markets.
Statement III: Article 6 of the Paris Agreement on climate change intends to promote inter-country non-market strategies to reach their climate targets.
Which one of the following is correct in respect of the above statements?
Both Statement II and Statement III are correct and both of them explain Statement I.
Both Statement II and Statement III are correct but only one of them explains Statement I.
Only one of Statements II and III is correct and that explains Statement I.
Neither Statement II nor Statement III is correct.
Correct Answer: A
Detailed Solution
Statement I is correct: Article 6 of the Paris Agreement provides mechanisms for voluntary international cooperation to implement Nationally Determined Contributions and raise climate ambition.
Article 6 includes both market-based and non-market forms of cooperation.
Because of this broad scope, Article 6 is frequently discussed in negotiations concerning climate change, sustainable development, carbon trading and international cooperation.
Statement II is correct: Article 6 establishes the basic framework for carbon markets and the transfer of emission-reduction outcomes between countries.
Article 6.2 permits countries to adopt cooperative approaches using Internationally Transferred Mitigation Outcomes.
One country may transfer these outcomes to another country for use towards its climate target.
Strong accounting and corresponding adjustments are required to prevent two countries from counting the same emission reduction towards their respective targets.
Article 6.4 establishes an international carbon-crediting mechanism under United Nations supervision.
Verified credits may be generated through projects that reduce emissions or remove greenhouse gases.
Therefore, Statement II provides an important reason for global discussion of Article 6 and explains Statement I.
Statement III is correct: Article 6.8 recognises non-market approaches for cooperation between countries.
Non-market approaches do not necessarily involve the trading of carbon credits.
They may include arrangements such as climate finance, technological cooperation, capacity building, adaptation, energy efficiency and institutional cooperation.
Their objectives include increasing mitigation and adaptation ambition, encouraging public and private participation and supporting sustainable development.
Therefore, Statement III also explains the international significance and frequent discussion of Article 6.
Article 6 market mechanisms can reduce the cost of emission reductions, but without environmental integrity and human-rights safeguards, they may create risks of double counting and low-quality credits.