The Carbon Market Institute (CMI) welcomes the United Nations’ High‑Level Expert Group on the Net Zero Emissions Commitments of Non-State Entities’ (UNHLEG) final report released at COP27 as an important contribution as focus sharpens on best practice in decarbonisation and use of high integrity carbon credits.
As a member-based institute that brings together nearly 150 leading organisations across the Australian economy, CMI promotes the use of market-based solutions and supports best practice in decarbonisation to limit warming to 1.5C. CMI engaged closely with the UNHLEG’s consultation through a formal submission and interview, as well as facilitating panel discussions with UNHLEG members at our Australasian Emissions Reduction Summit in October.
“The UNHLEG Report is an important contribution to the development of best practice guidance as businesses navigate towards net zero emissions in line with the Paris Agreement goals,” said John Connor, CEO CMI.
“While the focus is rightly on corporations’ own emission reduction pathways, it’s important to clarify that the UNHLEG report highlights the need for high integrity carbon credits, but does not recommend relegation of their use to later years, contrary to some interpretations.”
At p. 19 the UNHLEG report states:
As best-practice guidelines develop, non-state actors meeting their interim targets on their net zero pathway are strongly encouraged to balance out the rest of their annual unabated emissions by purchasing high-integrity carbon credits.
“It is vital that compliance and voluntary standards and regulations accelerate corporate decarbonisation, whilst also supporting emissions reduction across the economy through high integrity carbon crediting frameworks and markets.”
CMI also endorses the UNHLEG’s recommendation that “to effectively tackle greenwashing and ensure a level playing field, non‑state actors need to move from voluntary initiatives to regulated requirements for net zero”.
“The transition pathway for business is by no means straightforward. As highlighted in our submission to the UNHLEG, harmonised international guidance, reflected in domestic legal standards, is critical to ensuring that non-state entities’ decarbonisation strategies have integrity.”
“Different sectors need to confront different economic realities, businesses need to balance at-point decarbonisation alongside market-based approaches, while supply chain considerations present added complexities. Strong guidance for these entities will be important.”
“The UNHLEG report is expected to be joined at COP27 by fresh guidance from international voluntary carbon market integrity initiatives. CMI will work with members to best interpret this forthcoming guidance.
“CMI will also continue to support the maturation of Australia’s carbon market, to facilitate Australia’s ratcheting climate ambitions, through the implementation of the enhanced Safeguard Mechanism and any recommendations that flow from the Independent ACCU Review,” he said
CMIs full submission to the UNHLEG is available here.
For regular updates on COP27 and CMI’s events and updates, visit our COP27 Hub here.
About the Carbon Market Institute
The Carbon Market Institute (CMI) is a member-based institute accelerating the transition towards a negative emissions, nature positive world. It champions best practice in carbon markets and climate policy, and its nearly 150 members include primary producers, carbon project developers, Indigenous organisations, legal, technology and advisory services, insurers, banks, investors, corporate entities and emission intensive industries. The positions put forward constitute CMI’s independent view and do not purport to represent any CMI individual, member company, or industry sector. CMI’s latest Advocacy Policy Positions Statement can be viewed here.
For further information, contact Thomas Hann on 0408880536 or thomas.hann@carbonmarketinstitute.org
