London — Trading platform provider Global Environmental Markets is set to launch an emissions registry that aims to allow trading of emissions under the Paris Agreement.
The platform could allow governments to start to trade emissions reductions before the final rules are agreed under the UN Framework Convention on Climate Change.
Unveiling the system at the COP25 climate talks in Madrid, running December 2-13, the registry "demonstrated the importance of sovereign governments having access to software infrastructure if they are to make the most of the $300-billion opportunity in international carbon trading between 2020 and 2030," the company said in a statement Tuesday.
"GEM's software is secure, fully electronic and capable of instant electronic interface with any exchange, registry or transaction log," GEM said.
The system has undergone rigorous scrutiny and was approved during a recent consultancy to design the registry system for the national government of Sri Lanka -- a contract paid for and delivered to the World Bank -- the company said.
The company aims to have emissions trading infrastructure in place ahead of the completion of rules under the Paris Agreement's Article 6 -- the section that creates an international system of emissions trading under the 2015 accord.
Representatives from almost 200 countries have gathered in Madrid in a bid to agree the rules on Article 6, along with other elements including climate adaptation, capacity building, cities, finance, technology and forest protection.
"Our approach is based on a deep understanding of registries and how they operate," said Josh Brown, global head of sales at London-based GEM subsidiary Carbon Trade eXchange.
"Article 6 isn't finished. There are a few items to be finished at COP," said Brown in an interview Tuesday.
The company has developed a system of national registries for each country of the world in a general structure that would facilitate the international transfer of emissions credits that could include government environment ministries, he said.
"We see all the talk around Article 6 as an invitation to the private sector to provide the trading infrastructure," he said.
"Article 6 is done to a point, but it's not completely finished. It's virtually certain that credit demand will come from governments," CEO and founder of the company Wayne Sharpe said.
The company had responded to interest at the sovereign level, as the negotiations moved forward on the rules governing a system of emissions trading that is expected to underpin the Paris Agreement, Brown said.
"We've been approached by a number of governments who've shown interest. This product has been developed based on feedback and early inquiries," he said.
"We've had small island states asking how they can create emissions credits," he said.
"I think carbon trading is very important, but it's going to take a big push from the private sector to get this going. We've spoken to many traders who say they're very keen to get exposure to this, because the market could be massive," he said.
The company aims at offering trading of so-called "Internationally Transferred Mitigation Outcomes" or ITMOs - UN jargon for sovereign-level emissions credits under Article 6.2 of the Paris Agreement.
-- Frank Watson, firstname.lastname@example.org
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