February 13, 2025
THIMPHU – The Department of Environment and Climate Change (DECC) is hosting the 15th Article 6.4 Supervisory Body Mechanism (SBM) meeting to advance the next phase of the global carbon market implementation.
This year’s meeting follows the landmark finalisation of Article 6 rules at the 29th Conference of Parties (COP) in Baku, Azerbaijan, last year. Article 6 focuses on carbon markets, providing mechanisms for countries and companies to trade emission reductions to prevent additional carbon from entering the atmosphere.
The Article 6.4 Supervisory Body is the highest decision-making authority responsible for overseeing the implementation of the global carbon market under the Paris Agreement.
The meeting has brought together 24 Article 6 SBM members—six joining online—along with United Nations Framework Convention on Climate Change (UNFCCC) officials and key stakeholders.
The Supervisory Body’s primary mandate is to uphold environmental integrity, transparency, and alignment with the Sustainable Development Goals. It also approves Article 6.4 projects, methodologies, and Applicant Entities, oversees the transition of Clean Development Mechanism (CDM) activities, and ensures the effective implementation of the Paris Agreement Crediting Mechanism.
There are three sections under Article 6. Article 6.4 establishes an UN-supervised carbon market for trading emission reductions.
The credits generated through these projects—such as renewable energy and reforestation—can be sold globally after independent verification.
During the opening session, Lyonpo DN Dhungyel said that Bhutan was deeply honoured to be chosen as the host for the 2025 meeting—the first with a fully adopted Article 6 after nine years of negotiations. He acknowledged the leadership of Article 6.4 Supervisory Body members, Parties, and the UNFCCC Secretariat in achieving this milestone at COP29 in Baku.
“Choosing Bhutan as the host reflects the trust and collaboration we have fostered through our engagement with Parties and the Secretariat over the years,” Lyonpo said. “It further strengthens our resolve to contribute meaningfully to the success of the Paris Agreement.”
Lyonpo added that Bhutan sees Article 6 as a key opportunity to realise its carbon-negative vision.
“With net emissions at -9.7 million tonnes of CO₂, we are among the few nations with a negative carbon footprint. But rising emissions may change that by 2048, making carbon markets crucial in decarbonising our economy,” Lyonpo said.
Lyonpo emphasised the importance of fair and transparent carbon markets for the mechanism’s success. Noting growing interest from project developers, he said Bhutan was looking to the Supervisory Body for guidance to turn these opportunities into projects.
Bhutan has completed the preparatory stages of implementing Article 6 and is now working toward full operationalisation after fulfilling participation requirements by establishing the necessary policies, infrastructure, and institutional mechanisms to guide carbon project development under Article 6.
This includes setting up a national carbon registry, a positive list of eligible activities for carbon trading, and The Bhutan Climate Fund, which will facilitate resource pooling and carbon asset development.
Bhutan is ready to sell carbon credits to Singapore by engaging in cooperative approaches under Article 6.2, with Singapore being Bhutan’s first bilateral cooperation partner.
Article 6.2 credits, or Internationally Transferred Mitigation Outcomes, are traded directly between countries to meet Nationally Determined Contribution (NDC) targets, with strict accounting to avoid double counting.
“We expect international carbon markets to help mobilise resources to meet our NDC targets and support adaptation and resilience efforts,” Lyonpo 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.”
Lyonpo added that the decisions made during the meeting would shape the future of carbon markets and contribute significantly to the global fight against climate change and the achievement of Sustainable Development Goals.
The meeting, which started yesterday, will continue until February 14.