Current Status of Article 6 of the Paris Agreement: Internationally Transferred Mitigation Outcomes (ITMOs)
- Although the exact rulebook to guide countries in exchanging ITMOs and pursuing mitigation projects under Article 6 is not yet known, the evolution of the international carbon markets under the Paris Agreement presents many economic and climate benefits in both developing and developed countries.
- In order for Article 6 and ITMOs to be truly beneficial, certain safeguards need to be put in place to prevent the same pitfalls that plagued previous international offset schemes such as the Clean Development Mechanism.
Internationally transferred mitigation outcomes (ITMOs) use a carbon dioxide equivalent (CO2e) metric for a new set of market provisions or other greenhouse gas mitigation outcomes that are defined under Article 6 of the Paris Agreement. Set to come into effect as of 2020, they are meant to replace other existing forms of international carbon credits such as those issued under the Kyoto-era Clean Development Mechanism and Joint Implementation. ITMOs are not specifically defined yet and could take many forms, including the linking of emission trading systems across jurisdictions, investment in emission reduction projects, technology transfers and even credits from REDD+ schemes. Article 6 could therefore be a useful way to channel technology, finance and capacity building from developed to developing countries. Some argue it could support reaching the USD 100 billion climate finance commitment per year, though some countries oppose this approach.