Article 6 Updates: July 2026

July 2026 marked another busy month for Article 6 developments, including the Article 6.4 Supervisory Body’s 22^nd meeting. These developments illustrate both the increasing operational relevance of Article 6 and the persistence of important governance, environmental-integrity and implementation challenges.

Article 6.2

The UNFCCC held its third annual training course for Article 6 technical experts on 23–24 July (virtual). The training supports experts who review the initial and regular information submitted by Parties participating in Article 6.2 cooperative approaches. Technical expert review is one of the principal oversight mechanisms within the decentralised Article 6.2 architecture. Review teams assess whether Parties have provided the required information and identify inconsistencies with the Article 6.2 guidance. They do not, however, approve cooperative approaches or undertake independent project-level assessments.

By the end of July 2026, there were 112 bilateral agreements under Article 6.2 cooperative approaches, involving 65 different countries. Within these, 27.6 million ITMOs have been generated thus far.

Article 6.4

The Article 6.4 Supervisory Body met in Bonn from 27–30 July 2026 (webcast) covering a range of topics from methodologies, the mechanism registry, accreditation, the activity cycle, the share of proceeds (SOP), overall mitigation in global emissions (OMGE) and the mechanism’s financial position. Several decisions adopted in July remain provisional in practical terms, with further revisions or assessments expected once implementation experience becomes available.

The Supervisory Body adopted the PACM’s 3^rd methodology A6.4-AMM-003, Electricity generation from renewable sources connected to an electricity system, one of the major types of projects under the Clean Development Mechanism (CDM). However, the Supervisory Body requested continuing review of several central integrity questions, including:

• Common practice assessments;
• Applicable thresholds and restrictions;
• Technology-specific provisions;
• Emissions from hydropower reservoirs; and
• Whether differentiation among countries, technologies and market conditions may be needed.

The Supervisory Body also asked the Methodological Expert Panel to consider the methodology’s use of a relative downward adjustment when the broader baseline standard is next reviewed.  

The Supervisory Body considered a draft methodology for energy-efficiency measures in household cooking, but did not adopt it. Instead, it returned the proposal to the Methodological Expert Panel with a series of detailed questions, including:

• whether cookstove activities should be subject to reversal-risk or non-permanence provisions;
• the rationale for a proposed 4.5% penetration threshold for equivalent or more efficient cooking technologies;
• whether the exclusions adequately account for non-linear autonomous adoption;
• the treatment of heavily skewed performance data; and
• whether alternative statistical approaches would provide more representative baselines.

The Supervisory Body’s decision reflects the continuing scrutiny facing clean cooking crediting. While such activities may deliver meaningful benefits, their mitigation value relies on contested variables including stove use, fuel consumption, continued use of traditional stoves and the fraction of non-renewable biomass. 

The public consultation for the draft methodological tool on ‘Reversal Risk Assessment’, A6.4-MEP014-A07, closed on the 24th of July, is applicable to activities that reduce non-renewable biomass consumption, including cooking activities. This is a positive step forward, considering that these types of activities have not been scrutinised to this degree under previous crediting mechanisms. 

The Supervisory Body adopted a revised Article 6.4 mechanism registry procedure, following a public consultation that closed on 7 July.  The registry will provide the infrastructure through which Article 6.4 emission reductions are issued, held, transferred, cancelled and retired. Its design is consequently important not only for transactions, but also for implementing authorisations, tracking uses and preventing double counting. However, the adopted procedure will be revised again. The Supervisory Body requested further work on matters including authorisations issued after the initial issuance of units and the first transfer of units from a Party other than the host Party. The Body also decided not to repurpose the existing voluntary-cancellation platform for Article 6.4 registry operations. 

The Supervisory Body also considered the operationationalisation of SOP under Article 6.4. Rather than recommending substantive changes, it postponed a fuller assessment until more practical implementation experience exists. For the administrative SOP, the Body requested a revision limiting fee exemptions for programmes of activities to component activities hosted in least developed countries and small island developing states (SIDS). For the adaptation SOPs, it acknowledged implementation complexities and requested consultation with the Adaptation Fund Board. It also agreed to treat the Adaptation Fund (or its trustee) as an authorised entity under the relevant Article 6.4 cooperative approach, avoiding the need for separate authorisation by every participating Party.  

The Body similarly postponed its evaluation of whether the rules governing OMGE should be improved. The issue is expected to be assessed once the mechanism has generated sufficient operational evidence, with recommendations potentially submitted to the CMA at its ninth session at COP32. Deferring review may be pragmatic in the absence of transaction data. It also means, however, that the adequacy of the current cancellation rate and the effectiveness of SOP arrangements will not be comprehensively evaluated during the mechanism’s earliest operational phase.

The Supervisory Body acknowledged a funding gap for the 2027 budget and requested further information on alternative funding sources. It also requested the Secretariat to continue limiting expenditure, identifying efficiency gains and reporting regularly on income and spending. The funding challenge is increasingly important. Operating the mechanism requires support for methodologies, accreditation, activity registration, issuance, registry infrastructure, stakeholder engagement and appeals and grievance processes. A lack of predictable resources could delay regulatory work or create pressure to rely more heavily on transaction-linked income before the market reaches sufficient scale. The Body requested that its annual report to CMA 8 (COP31) explain the mechanism’s financial position more clearly and identify possible recommendations for Parties.  

July also included several opportunities for stakeholders to provide input into Article 6.4 rulemaking, including the Sustainable Development Tool. On 29 July, the UNFCCC also opened a new consultation on documents for the Methodological Expert Panel’s fifteenth meeting (MEP015).  

The Application for Accreditation form (A6.4-FORM-ACCR-001) was also updated to a v 3.0 that includes further information on conflicts of interest in Section 3.1, including requiring the applicant to disclose that they are not involved in various aspects of market promotion, capacity building or otherwise offer payments of commissions for promotion or new business. 

By the end of July, 129 designated national authorities had been established and 69 countries had submitted information showing fulfilment of host Party participation requirements.  

Article 6.8

The UNFCCC published new frequently asked questions on Article 6.8 non-market approaches on 7 July. The material explains how Article 6.8 can facilitate cooperation without transferring mitigation outcomes or generating tradable credits.  

Article 6 Policy Developments

On 17 July, the European Commission published proposals for a targeted revision of the EU Emissions Trading System. The accompanying impact assessment stated that the EU ETS should provide adequate funding for the purchase of high-quality international credits used in implementing the European Climate Law (which anticipates their potential use for up to 5% of 1990 EU net emissions). Notably, between 2036 and 2040, a portion of the allowances could be auctioned to generate revenues for the procurement of an equivalent volume of international credits from Article 6 mechanisms. This creates the prospect of the EU becoming one of the world’s largest buyers of Article 6 mitigation outcomes. As a sovereign buyer, the EU could be rivaled by China, whose new guidelines for zero-carbon factories can generate considerable demand for ITMOs. 

A further set of third-generation NDCs published in 2026 provides new insight into how other jurisdictions intend to use Article 6 during the next implementation period: Guyana, Malawi and Oman.

Guyana’s NDC for 2025–2035 places jurisdictional forest carbon markets at the centre of its conditional mitigation contribution. It states that Guyana can generate ITMOs and participate in high-integrity carbon markets in accordance with UNFCCC guidance. Subject to adequate financial incentives, the country identifies a potential contribution of up to 32,695,707 tCO₂e annually through forest-based emission credits.  The NDC divides this annual forest-sector contribution into a 23,042,163 tCO₂e market-based finance target, associated with ART-TREES and the forest sector; and a further 9,653,544 tCO₂e finance dependent target forms of support may be pursued. Guyana states that it will limit the issuance of market-facing credits to the quantities permitted under ART-TREES, which it identifies as its chosen standard. The NDC explains that the ART-TREES reference level is more conservative than Guyana’s UNFCCC forest reference level and that non-market mechanisms may therefore be considered for the remainder of the country’s potential mitigation contribution.

This formulation is notable because it expressly connects a national NDC target, a jurisdictional independent standard and potential Article 6 transfers. It also raises important accounting questions. The NDC refers to the full 32.7 million tCO₂e as potential ITMOs, while also suggesting that only part of this amount would be issued as market-facing ART-TREES credits and that non-market finance may support the balance. Greater clarity will ultimately be needed on which outcomes would be authorised, transferred and correspondingly adjusted, and which would remain within Guyana’s NDC accounting. It also identifies further capacity building for Article 6 implementation, forest monitoring and digital MRV as part of its means of implementation. Their NDC further commits to investing revenues in priorities under the Low Carbon Development Strategy 2030, with a minimum of 15% allocated for direct access by Indigenous Peoples and Local Communities. It also sets targets for the share of Indigenous villages benefiting from carbon credit revenue: 80% by 2030 and 100% by 2035.  

Malawi’s NDC 3.0 adopts a broader and less transaction-specific approach. It states that Malawi intends to use opportunities under Article 6 and other carbon market mechanisms to attract private investment, building on the country’s earlier experience with carbon-credit projects. The NDC reports that Malawi has developed a national framework covering transparent carbon market transactions; benefit sharing; and the reinvestment of proceeds in community-based and sustainable projects.  The NDC also shows how Article 6 is embedded within a much larger climate-finance strategy. Malawi estimates that implementation of its NDC will require USD 7.06 billion between 2025 and 2035, of which approximately USD 4.28 billion is conditional on international support. Carbon markets, results-based payments, public-private partnerships and other innovative instruments are identified as possible channels for closing this financing gap. Their updated NDC also proposes institutional measures intended to make carbon market participation more credible. These include integrating project level MRV with climate-budget tagging, tracking finance flows, establishing a permanent MRV unit and creating a centralised digital data platform.

Oman’s NDC 3.0 notes that the Oman Net Zero Centre, established through Ministerial Decision 35/2024, serves as the designated national authority for both cooperative approaches under Article 6.2 and the PACM, while the Environment Authority is assigned responsibility for non-market approaches under Article 6.8. Specific details on the substantive approach These questions are particularly significant given Oman’s revised mitigation architecture. The country has shifted from a business-as-usual target to an absolute 2024 base year of 93.6 MtCO₂e, with a 7% unconditional reduction and a further 26% conditional reduction by 2035, producing a total potential reduction of 33%. However, the NDC does not yet specify whether internationally transferred outcomes would come from mitigation beyond the conditional target or whether Article 6 finance is expected to help deliver part of that target.

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