In a significant step forward for the global fight against climate change, the Department of Environment and Climate Change (DECC) has convened the 15th meeting of the Article 6.4 Supervisory Body. This gathering marks a critical phase in the evolution of carbon markets, building on the recently finalised Article 6 rules agreed at COP29 in Baku last year.
The meeting, which brought together 24 members of the Article 6 Supervisory Body—six of whom joined remotely—also featured representatives from the United Nations Framework Convention on Climate Change (UNFCCC) and other influential stakeholders. The Supervisory Body serves as the principal authority overseeing the implementation of the Paris Agreement’s carbon market mechanism, ensuring that every project and methodology adheres to the highest standards of environmental integrity, transparency, and alignment with the Sustainable Development Goals.
At the opening session, Lyonpo DN Dhungyel expressed Bhutan’s honour in hosting the meeting—a first for a fully adopted Article 6 framework after nearly a decade of protracted negotiations. “Choosing Bhutan as the host reflects the trust and collaboration we have fostered through our engagement with Parties and the Secretariat over the years,” he stated. “It further strengthens our resolve to contribute meaningfully to the success of the Paris Agreement.”
Bhutan, a nation celebrated for its negative carbon footprint of -9.7 million tonnes of CO₂, views Article 6 as a transformative opportunity. Despite its current status, Lyonpo warned that rising emissions could jeopardise this standing by 2048, underscoring the urgency of integrating carbon markets into national decarbonisation efforts. The country is now transitioning from preliminary implementation phases to full operationalisation, having established a national carbon registry, a positive list of eligible carbon trading activities, and the Bhutan Climate Fund—an initiative aimed at pooling resources for sustainable carbon asset development.
The Article 6.4 mechanism, which sets up an UN-supervised carbon market, allows nations and companies to trade emission reduction credits globally. Projects ranging from renewable energy installations to expansive reforestation initiatives, once independently verified, can generate credits that contribute to a cleaner global environment. Meanwhile, Bhutan is gearing up for its first bilateral carbon market engagement by preparing to sell credits to Singapore under cooperative approaches defined by Article 6.2. These credits, known as Internationally Transferred Mitigation Outcomes, enable direct trading between nations to help them meet their Nationally Determined Contribution targets while ensuring rigorous accounting practices.
Highlighting the broader implications of these initiatives, Lyonpo emphasised that well-regulated and transparent carbon markets are essential not only for environmental preservation but also for spurring economic diversification. “We expect international carbon markets to help mobilise resources to meet our NDC targets and support adaptation and resilience efforts,” he said. “Beyond financial benefits, carbon markets can attract investments in projects that would otherwise be unviable, diversify our economy, improve livelihoods, and drive sustainable development.”
As discussions continue, stakeholders remain optimistic that the decisions made during this meeting will set the stage for more robust carbon trading frameworks. With the global community increasingly looking to such markets to bridge the gap between environmental targets and economic realities, Bhutan’s role as host underscores the critical intersection of innovation, policy, and international cooperation in the battle against climate change.
