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QuickTake

How a Global Carbon Market Could Accelerate Net-Zero

Power Generation in Germany
Photographer: Krisztian Bocsi/Bloomberg
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As companies around the world seek to burnish their green credentials, plans for a rigorous and regulated international carbon market to help countries and businesses reach their climate goals are becoming a key part of the fight against climate change. Proposals were outlined in Article 6 of the 2015 Paris Agreement, which has been argued over by climate diplomats for six years. Now it’s turning into one of the hot topics for the COP26 climate talks in Glasgow. While there are prospects that a deal can be reached, there are also plenty of worries about what could happen if it’s poorly executed. 

It provides a framework to help countries work together to reach emissions-reduction goals, primarily by trading credits that count toward their targets and sharing the burden of the climate fight. It was included in the 2015 Paris Agreement, which more than 190 countries have ratified, but the specifics were still in dispute at the 2019 COP meeting in Madrid, and the proposals since then haven’t led to anything concrete.