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ARTICLE 6.4

WHAT IS ARTICLE 6.4 ?

Article 6.4 establishes a centralized UN-governed carbon crediting mechanism—the Paris Agreement Crediting Mechanism (PACM) to facilitate international cooperation in achieving climate goals. Designed to replace the Kyoto Protocol’s Clean Development Mechanism (CDM), it aims to enhance climate ambition while ensuring environmental integrity, transparency, and sustainable development.

Article 6.4 provides a robust, supervised carbon market mechanism under the Paris Agreement, facilitating international cooperation on emission reductions through regulated project-based carbon credits that support sustainable development and climate goals.

KEY FEATURES OF ARTICLE 6.4

  • Article 6.4 enables the issuance of Article 6.4 Emission Reductions (A6.4ERs), which are tradable carbon credits authorized by the host countries and require corresponding adjustments to prevent double counting of emission reductions.
  • The Article 6.4 Supervisory Body is responsible for developing methodologies, approving projects, managing the registry, and ensuring adherence to quality and sustainability standards.
  • The mechanism emphasizes higher quality standards compared to the Clean Development Mechanism (CDM), incorporating performance-based baselines that promote ambition beyond business-as-usual scenarios, along with safeguards to protect biodiversity and social interests.

WHY ARTICLE 6.4?

Article 6.4 of the Paris Agreement is designed to create a transparent, and UN-governed global carbon market mechanism that allows countries to generate, trade, and utilize carbon credits to achieve their climate goals (Nationally Determined Contributions or NDCs) more efficiently and cost-effectively. The main purposes of Article 6.4 are:

  • It enables countries with higher emissions to support emission reduction initiatives in other nations, fostering collective global climate efforts and encouraging more ambitious targets.
  • Article 6.4 offers a modern framework with improved environmental integrity, transparency, and sustainability safeguards, addressing previous shortcomings of the CDM.
  • By establishing an operational global carbon market, Article 6.4 directs funding towards under-resourced areas such as forest conservation, reforestation, and ecosystem-based mitigation, which are vital for long-term climate resilience.

Article 6.4 is to establish a credible, efficient, and sustainable international carbon market that advances climate ambition, supports sustainable development, and safeguards environmental integrity within the Paris Agreement framework.

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