Participants during the, “High-Integrity Carbon Markets: Impact and Path to Accelerated Climate Action,” discussions at UNEA-7. PHOTO/UN
BY KARIUKI CHEGE
newshub@eyewitness.africa
Over 200 participants convened at a pivotal event on the margins of the United Nations Environment Assembly (UNEA-7) to explore the rapidly evolving role of carbon markets in addressing climate change.
The session, titled “High-Integrity Carbon Markets: Impact and Path to Accelerated Climate Action,” offered a timely opportunity to delve into the growing significance of carbon markets, with a particular focus on how ensuring integrity can help accelerate efforts to combat global warming.
In her opening remarks, UNEP Executive Director Inger Andersen stressed the urgency of enhancing climate mitigation strategies while upholding environmental and social integrity.
“The window for effective climate mitigation is narrowing, and we must act with urgency and equity,” Andersen stated, framing the discussion that followed on the current status of carbon markets and their potential to scale up.
Gabriel Labbate, Head of the Climate Mitigation Unit at UNEP, highlighted the increasing role of carbon pricing in global emissions reduction. Labbate noted that carbon markets, which currently cover about 28% of global emissions, are poised for significant growth.
He also pointed out the increasing importance of international cooperation under Article 6 of the Paris Agreement, which aims to facilitate emissions reductions across borders through market-based mechanisms.
The event also addressed the challenges of ensuring that carbon markets operate with integrity. Labbate introduced the concept of a “quality reset,” a shift in focus towards ensuring that carbon credits represent real, verifiable, and long-term emissions reductions. This change is critical to enhancing the credibility of carbon markets, which are increasingly under scrutiny from both buyers and regulators.
Fundile Maphanga, Policy Lead at Allied Offsets, provided a data-driven analysis of market trends. While the voluntary carbon market (VCM) remains oversupplied, with 5.6 billion tonnes of credits issued compared to just 1.5 billion tonnes retired, a clear shift towards high-quality carbon removal credits is taking shape.
Maphanga revealed that offtake volumes have surged 320-fold since 2020, signaling growing confidence in high-integrity credits. These credits, which focus on carbon removal rather than mere avoidance, are driving value and price signals in the market.
Looking to the future, Maphanga projected that the VCM could grow from USD 1.3 billion in 2025 to a staggering USD 161 billion by 2050, driven by increased demand for high-quality credits. As the market matures and oversupply decreases, prices are expected to rise, reflecting the increased value of truly impactful carbon offset projects.
Beyond market statistics, the discussions at the event centred on how carbon markets can support broader climate goals, including sustainable development and the delivery of social benefits.
Panelists underscored the need for multi-stakeholder collaboration, with government, private sector, and civil society actors all playing crucial roles in ensuring that carbon markets contribute to both environmental and social outcomes.
The event underscored the growing recognition that carbon markets, if designed and implemented with integrity, can be a critical tool in the fight against climate change.
As the demand for high-quality carbon credits continues to rise, experts agreed that the market’s ability to deliver real and lasting emissions reductions will depend on robust standards, transparency, and accountability.
As the world seeks to meet its ambitious climate targets, the discussion at UNEA-7 made it clear that high-integrity carbon markets, backed by strong governance frameworks, could play a transformative role in accelerating global climate action.
