Mr Labbate said if Africa sends a signal either to operate in a voluntary carbon market, integrity will be key and scale will follow.
In this interview with PREMIUM TIMES during the 29th UN Climate Change Summit (COP29) in Baku, Azerbaijan's capital, Gabriel Labbate, head of the UN Environment Programme's climate mediation unit, discussed the newly adopted carbon market framework and its potential benefits for Africa.
Within the first 48 hours of COP29, countries reached a consensus on standards for carbon credits under Article 6.4 of the Paris Agreement, enhancing climate action and ensuring the integrity of the international carbon market. Carbon credits represent reductions or removals of carbon emissions, allowing investors and corporations to trade them, which helps mitigate environmental issues while creating market opportunities.
In this interview, Mr Labbate noted that Africa could harness significant benefits from this initiative by achieving fair carbon prices and protecting forests. However, climate advocates are concerned that carbon market initiatives are false solutions to the climate crisis and may lead to land grabbing and allow wealthy companies to maintain emissions.
Excerpt:
PT: COP29 has adopted standards for creating a carbon market, a significant win. How will this benefit Africa, which is still developing its carbon market, in terms of long-term climate action?
Labbate: When it was approved in the first couple of days, you could consider that an umbrella document, guidance, methodological guidance, in general, and for removals specifically, there is a particular document for that. Removal is basically taking carbon oxide (CO2) out of the air and storing that somewhere; it could be in trees, in soils and it could be underground. There was one document, an umbrella document for removals, with basic rules, another one for methods in general and another one for sustainable development benefits. We want the carbon market to achieve emissions reductions or removals and contribute to sustainable development. Those were the documents that the Conference of Parties took notes on, that is what happened. And there will be future guidance in terms of continuously developing this line of work. In 2025, there will be methodologies that would be sent for approval of article 6.4 and these methodologies will need to comply with the elements that we see in this document. That is what is seen at the moment. In parallel, we have the voluntary carbon market, and the voluntary carbon market already has some methodologies for emissions, reductions and removals. Some of these methodologies have been assessed by the council for the voluntary carbon market that works is ongoing and those that are considered to be of high quality receive a label that is called the Coal carbon print, which is what we have at the moment. Going to Africa, it was important to set the background where we are. Africa has great potential to be a player in the carbon market. Both through Article 6 and through the voluntary carbon market. It has potential in terms of nature (and) has a huge potential in terms of reducing emissions from deforestation and forest degradation. It has potential from cook stoves which is an important category for rural populations in Africa because of major benefits for women. It also has a good potential for some countries in engineering, carbon capture and storage. It will need to develop. Africa is still a very small part of the carbon market but with the right conditions and keeping focus on integrity, making sure that the emissions reductions are real and additional. My opinion is a "yes", Africa has a bright future.
PT: Looking at the document adopted for the creation of the carbon market, is there anything that is striking for you as a carbon market expert? And are there any opportunities that you think Africa can also leverage based on some of the standards created and adopted during the plenary?
Labbate: What was approved in the first week of COP is still what would be considered an "umbrella document", basic guidelines about how the market should work, and how to ensure the integrity of emissions reduction. There is another step, like I said, which is to submit methodologies for carbon credits, how to generate carbon credits and ensure that they pass the assessment and that they are in compliance with this document. The whole package presents an opportunity for Africa, if Africa can put in place the enabling conditions for project developers to come to Africa. Having the assurance of a stable environment, if Africa sends a signal either to operate in Article 6 or a voluntary carbon market, integrity will be key and scale will follow.
PT: But you know, in Africa, some people see carbon market/credit as an opportunity to perpetuate land grabbing by the so-called rich guys and some have described it as a false solution here as the negotiations are ongoing. What's your perception of this? Do you share similar views?
Labbate: My perception is that the carbon market in the past has shown problems. Some projects were not good. Some actors were not good. And at the same time, there are good projects and there are good actors in the market. People trying to do things correctly. And the market has learned from the problems we saw in the past. At the integrity council, we approved some methodologies some weeks ago that are added to the categories of REDD+. Some of the projects that had problems in the past were REDD+ projects, but we see that these new methodologies have improved significantly and we'll continue monitoring the implementation of these methodologies to make sure that if and when future problems arise, we can correct them. I know that opinion, and I believe that there is some truth to it because there have been problems. At the same time, looking into the future, I see a market where we'll hear more good stories than bad ones.
PT: There are concerns also about the underpricing and undervaluing of natural covers in Africa. Do you also think that Africa truly benefits from the Carbon Market?
Labbate: This is a very good question. In fact, the UN Environment Program where I work, a year ago published a report on the price of forest carbon and basically, to make the long story short, we said that the price of forest carbon, the price of REDD+ should quickly achieve at least $30 a tonne, now it is $10-$12 and then quickly go to $15. If we can quickly achieve that price, then we'll put in place good prices for countries, for people to protect forests. So you are right, at the moment prices are very low. Part of the problem, because the prices are very low, is related to this concern about integrity, land grabbing, social and environmental sectors in general. And you never know whether the credits you are buying were good or bad and then some potential buyers retreated from this market. We expect that we now signal which methodologies are good. We expect that we would see additional buyers in the market, that there will be a reaction that there is a need to invest directly, and that, hopefully, we'll see that increasing pricing that we all want to see.
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PT: How can we ensure accountability and transparency in Africa's carbon market?
Labbate: Well, now going back to the ICVCM, they assess these methodologies through what we call the assessment framework in which we have all the core carbon principles and are very specific and stringent criteria that a methodology has to comply with as part of these core carbon principles; social and environmental safeguard is a key part. So, a way to increase accountability is first, we want a market to prioritise these high integrity priorities, that number one, we want the crediting programme - sometimes people call them standards - to monitor and enforce compliance with these methodologies so that the project developers will follow the letter of the law of the methodologies. We want to see validation and verification bodies--those are the companies that come to visit this project, validate that the project is doing what it said it would do, and verify that the credits that are issued have been issued in compliance with methodologies that are of integrity. We also expect the press like you to continue watching and put pressure on all this part of the system to do the work. If that comes together and we see that coming together, the accountability will improve significantly.
