by Dr. Sven Kolmetz, Chairman of the Project Developer Forum
The carbon market continues to evolve rapidly, presenting both opportunities and challenges for project developers. As efforts to scale climate solutions intensify, developers are adapting to a landscape that’s increasingly complex and demanding.
Fragmentation across markets and delays in operationalising frameworks like Article 6.4 have created uncertainty, prompting developers to diversify portfolios and focus on higher-quality credits that deliver broader social and environmental benefits. High-integrity carbon removal credits are in growing demand, particularly as companies align with net-zero ambitions.
Against this backdrop, the approval of the first Programme of Activities (PoA) under Article 6.4 marks a significant step forward.
The Project Developer (PD) Forum welcomes this progress as a step towards providing structure and credibility in carbon markets. After years of uncertainty, having a UN-backed framework in place is essential to maintaining investor confidence and ensuring continuity for projects that deliver real-world climate and social benefits.
However, the pace of implementation remains a challenge. Political instability in host countries and prolonged delays in operationalising Article 6.4 have had real consequences, creating uncertainty for investors. The transition from the Clean Development Mechanism (CDM) to Article 6.4 must be carefully managed to avoid stalling vital projects and discouraging investment. Many developers had already secured funding based on existing CDM methodologies, and a sudden shift without a functional alternative would create significant risks.
Balancing rigour and urgency
The recent ICVCM decision on cookstove methodologies reflects both the rapid developments in this sector and its progress toward higher integrity. The council approved three new methodologies – two from Gold Standard and one from Verra – while rejecting older methodologies, including AMS-II.G, due to concerns over insufficient rigour and risks of over-crediting. These newly approved methodologies introduce stricter requirements for measuring baseline fuel use, monitoring technology adoption, and calculating emission reductions, ensuring higher integrity in carbon credits.
This decision reflects the sector’s progress toward adopting best practices and addressing long-standing criticisms. Transitioning to these more stringent methodologies will inevitably pose compliance and commercial challenges for existing cookstove projects. However, in the long term we accept that it is a necessary step to bolster confidence in clean cookstove carbon credits and their climate impact.
Clean cookstove projects remain critical for addressing immediate climate and social challenges, such as reducing air pollution, improving health outcomes, and alleviating fuel poverty. The approved methodologies ensure these benefits are achieved without compromising the credibility of emissions reductions. Delaying action in pursuit of unattainable perfection could mean missing vital opportunities to support vulnerable communities and advance the UN Sustainable Development Goals (SDGs).
In the meantime, the decision to allow continued use of AMS-II.G, with a transition period until 2025, is welcome. This is not about lowering standards – it is about ensuring continuity for existing projects while allowing new projects to apply the approved methodologies. AMS-II.G has already undergone several revisions to improve its accuracy, and the transitioning project’s crediting period is set to end in August, further limiting the risk of over-crediting.
Furthermore, many of the projects falling under this particular CDM address immediate climate and social challenges, such as improving air quality and reducing fuel poverty. These interventions contribute significantly to the SDGs and delaying their implementation in pursuit of methodological perfection could mean missing critical opportunities to cut emissions and support vulnerable communities. The current clear-cut of USAID under the new US administration further underlines the urgency of alternative climate (and social) finance.
Across the voluntary carbon market, developers are already adapting to these changes by implementing enhanced measurement approaches and meeting stricter criteria – including the aforementioned – and from the likes of host government approvals. This pragmatic transition underscores the sector’s commitment to transparency, accountability, and high-integrity climate finance.
Pragmatic oversight in an evolving market
The carbon market is already under intense scrutiny, and regulation is undoubtedly necessary. However, the way it is introduced matters. Recent discussions within the PD Forum have emphasised the need for regulatory frameworks that are effective but not unnecessarily burdensome. There is consensus that regulation must be streamlined, practical, and developed in consultation with project developers.
Some regulatory efforts, including those under CORSIA and ICVCM, have perhaps not engaged with project developers as much as we would have hoped. A well-functioning market needs regulation that balances credibility with feasibility. The UNFCCC and other governing bodies must ensure that regulatory frameworks are designed to enable – not stifle – climate action.
The PD Forum does not oppose regulation but rather advocates for streamlined, pragmatic oversight that fosters innovation and investment. The ultimate goal should be to create an environment where high-integrity carbon projects can thrive, while maintaining confidence among investors and buyers.
A critical moment for the carbon market
As the carbon market evolves under the Paris Agreement, project developers must navigate an increasingly complex landscape. The transition from CDM to Article 6.4, the evolution of methodologies, and the introduction of new regulatory frameworks all present challenges and opportunities.
A balanced approach is essential. While continuous improvement in standards and methodologies is necessary, it should not come at the expense of immediate climate action. Investor confidence must be maintained, and project developers need regulatory certainty to continue driving meaningful emissions reductions.
The Project Developer Forum will continue to advocate for a practical, well-regulated carbon market – one that fosters innovation, ensures integrity, and enables projects to deliver real climate and social benefits. The decisions made now will shape the future of carbon markets, and it is critical that they support, rather than hinder, the momentum needed to achieve global climate goals.
Relevant: ICVCM Gives Green Light For Three Stricter Cookstove Methodologies
About the Project Developer Forum
The Project Developer Forum is a global network and collective voice of companies and practitioners dedicated to developing and financing greenhouse gas emission reduction projects. With a diverse membership that spans all regions, we bring together in-depth technical expertise and practical experience with international frameworks such as the Clean Development Mechanism, Joint Implementation, voluntary carbon standards, climate finance, and country-specific initiatives like Nationally Appropriate Mitigation Actions.
The Project Developer Forum plays a pivotal role in advancing the technical knowledge and credibility of carbon project development, actively engaging with global regulatory bodies to influence standards and policies. By shaping the future of emission reduction mechanisms, we ensure the continued integrity and effectiveness of carbon projects, driving progress in the global effort to mitigate climate change.
