IETA coalition seeks five Article 6.4 reforms at COP31

By Olivia Hart

Five proposed reforms could determine whether the Paris Agreement Crediting Mechanism (PACM) becomes a practical source of carbon-credit finance.

IETA, the Project Developer Forum (PDF) and the Wildlife Conservation Society (WCS) issued an open letter to Parties attending CMA.8, also known as COP31, in Antalya. The groups ask delegates to issue formal guidance to the Article 6.4 Supervisory Body (SBM) on slow project implementation, regulatory friction and looming financial constraints within Article 6.4.

Why is the carbon-credit mechanism under financial pressure?

The letter acknowledges regulatory progress by the Supervisory Body but identifies methodology development as a critical bottleneck. The PACM relies on "credit issuance fees for self-funding," according to the letter, and faces depleting reserve resources transferred from the Clean Development Mechanism (CDM) Trust Fund.

The coalition links slow methods, complex conservative baselines and high uncertainty requirements to slower credit uptake and long-term financial viability. The letter warns that PACM could end up "remaining a marginal contributor to global mitigation targets."

Slow methods mean fewer credits to issue. Fewer credits mean less fee income. The funding arithmetic is not generous.

What five changes do the coalition want?

The open letter asks Parties at COP31 to take five actions.

• Assess standards as a package. Seek an official impact assessment of how baseline assumptions, additionality checks, monitoring mandates and buffer contributions combine to affect project feasibility and pricing for nationally determined contribution compliance and voluntary use.
• Revise downward adjustments and uncertainty rules. Reform restrictive baseline standards to allow exclusions for downward adjustments in specific cases, and correct overly conservative interpretations of uncertainty rules that prevent legitimate emission reductions from generating credits.
• Test barriers to broader participation. Assess whether current standards create disproportionate entry barriers for capacity-constrained developing countries, including requirements for granular grid data or complex national REDD+ planning frameworks.
• Rework reversal-risk frameworks. Test alternative, scientifically robust approaches for reversal risks in nature-based removal projects, keeping buffer pools and guarantee mechanisms practical without pricing out land-based activities.
• Strengthen governance and infrastructure. Establish predictable calendars for public input, ensure expert panel recommendations reflect the best available science rather than policy motives, publish clear methodology prioritization criteria, and assess the real-world impact of designated national authority capacity building.

Each proposal reaches a different part of the credit chain, from the baseline to the buffer and the public consultation calendar. Together, they form a commercial test for a mechanism whose funding base is already under strain.

Can formal guidance unlock stalled projects?

The immediate ask is guidance from the Parties. The coalition wants a high-integrity, commercially viable framework under Article 6.4 that can mobilize private capital for global climate action. It also calls structural reform essential to that goal.

The distinction matters. The Supervisory Body can refine technical rules, but the Parties attending CMA.8 must set the direction. Guidance that does not produce usable methodologies would leave the central bottleneck in place.

COP31 has a wider agenda. Türkiye is due to launch a $6 billion industrial decarbonization platform in Antalya. UN technical reviews have also highlighted integrity gaps in Article 6.2 carbon trading. Neither development settles the Article 6.4 questions in the letter.

What milestone comes next?

CMA.8 delegates must decide whether to issue formal guidance to the Article 6.4 Supervisory Body, and how far to go on baselines, uncertainty, participation, reversal risk and governance. The letter provides a checklist, not an automatic market revival.

The decisive step is a clear instruction from the Parties. Without it, project developers still face the slow methods and financial uncertainty that the coalition has placed on the agenda.