These standards provide for a centralized carbon market under United Nations (UN), a landmark step towards the conclusion of negotiations under Article 6 of the Paris Agreement. 

Article 6 of the Paris Agreement

• It provides principles through which countries can “pursue voluntary cooperation” to reach their climate targets.
  • Allows countries to transfer carbon credits earned from the reduction of greenhouse gas emissions helping other countries meet their climate targets. 
• It comprises two sub-sections: Article 6.2 and Article 6.4
  • Article 6.2: Countries can trade emission reductions/removals through bilateral or multilateral agreements. 
    • Traded credits are called Internationally Transferred Mitigation Outcomes (ITMOs) measured in carbon dioxide equivalent (CO2e) or any other metric. 
  • Article 6.4 or the Paris Agreement Crediting Mechanism: Seeks to create a global carbon market overseen by a UN entity called Article 6.4 Supervisory Body (6.4SB).
    • Credits under this are called A6.4ERs, and can be bought by countries, companies, or individuals.
    • Currently agreed standards were proposed at the meeting of the Supervisory Body for Article 6.4 at Baku last month.

Significance of the agreed Carbon Market Standards

• Unlock financial support to developing countries.
• Facilitate post-credit monitoring and long-term market reliability.