WSDS 2024: Hard to abate sectors and science based targets should come into equation to make the carbon market work
Day 2 of World Sustainable Development Summit, opened with a session on visionary institution building and unfurled into many thematic tracks ranging from “Just Transitions for Land- Based Climate Action In India”, “ Market and Finance Instruments to Propel Climate Action”, “Sustainable Skylines: Enabling Tomorrow’s Architecture with a Web- Based Knowledge Hub on Advanced Building Materials and Energy Efficient Design” and various others.
In thematic session, "Market and Finance Instruments to Propel Climate Action"- the discussion explored the hotly revolving topic of climate change and carbon markets. Carbon markets being seen as a mechanism to implement the Paris Agreement and for countries to meet their nationally determined targets.
The potential of carbon markets is huge to deal with climate change, it can be a vehicle to manage risks, enhance economic growth and provide financial support to the climate projects. It will also lead to an active role of the private players in combating climate change. However, the private community needs to keep track of the discourse to attract investments.
Shalabh Tandon, Regional Director and South Asia Regional Head of Operations and Climate Change, IFC says, “Carbon market is not a silver bullet but the gap is so large that every penny counts. It can be a key contributor. If this credit flows outside the country then will we have meaningful pricing? Hard to abate sectors and science based targets should come into the equation to make the carbon market work.”
Perumal Arunmugam, Manager, Mitigation Division, UNFCCC says, “ Carbon market also has a SWIFT code which stands for S (Supplementarity),W (Worldwide), I (integrity), F (fungibility) ,T (transparency). To propel climate action finance one needs to stick to SWIFT code.”
Discussions also revolved around Article 6 of the Paris Agreement, The Global Stocktake, national determined contributions, performance achievement trade mechanism, clean development mechanism, carbon accounting , forestry and renewable sectors, green bonds and carbon markets, carbon cess, Micro Small Medium Enterprises etc.