Budget debates over the Paris Agreement’s Article 6.4 carbon market. Pictured: COP30 President André Corrêa do Lago (right) and COP30 CEO Ana Toni. (Photo: Ueslei Marcelino/COP30)
The global carbon market under Article 6.4 of the Paris Agreement is facing a funding crunch, raising concerns that part of its budget may be diverted to the Adaptation Fund. Such a shift could delay the launch of the new carbon market mechanism.
Meanwhile, demand for carbon credits issued under the Kyoto Protocol has plummeted amid structural changes, and the mechanism may formally wind down by the end of 2026.
UN’s new carbon market takes shape as CDM nears phaseout
As COP30 enters the final stretch, draft texts on key agenda items continue to emerge. Building on decisions adopted in 2024, the Paris Agreement’s Article 6.4 mechanism—intended to establish a UN-governed global carbon market—is making incremental progress. Negotiations this week focus heavily on funding sources and the transition from legacy systems.
