Article 6 of the Paris Agreement

2nd Reporting Working Group ofThe Paris Agreement Article 6 Implementation Partnership

October 2023

Overview▪ Context▪ Work-programme on reporting▪ Evolution in the discussions▪ Agreed electronic format▪ Sequencing▪ Tables for reporting▪ Methods for converting non-GHG reporting implications▪ Common nomenclatures▪ Expectations for CMA 5

Context
The reporting is a central element of the Article 6 paragraph 2 framework

Initial report

UpdatedInitial report

Annualinformation

Regularinformation

Party specificinformation

Cooperative
approach(es)information

Cooperative
approach(es)information

Agreedelectronic
formatNarrative
information

Quantitative
information

Para 18 a-f

Para 18 g-i

Para 18 g-i

Para 20

Para 21, 22

Para 23

Cover, 6/CMA.4, p.23

Submission
portalA6 TER
A6database

CARP

Publicinterface

ETF
submission
portal
A13 TER

Context
The reporting is a central element of the Article 6 market-based instruments

Initial report

UpdatedInitial report

Annualinformation

Regularinformation

Party specificinformation

Cooperative
approach(es)information

Cooperative
approach(es)information

Agreedelectronic
formatNarrative
information

Quantitative
information

Para 18 a-f

Para 18 g-i

Para 18 g-i

Para 20

Para 21, 22

Para 23

Cover, 6/CMA.4, p.23

Submission
portalA6 TER
A6database

CARP

Publicinterface

ETF
submission
portal
A13 TER

Work-programme on reporting in 2023
Reference

MandateArticle 6.2: decision

Also requests the SBSTA to continue its work on the draft version of6/CMA.4, para 4 –the agreed electronic format referred to in paragraph 2 above […];SBSTA recommendations
Article 6.2: decision

The sequencing and timing of the submission of the initial report, the6/CMA.4, para 17(a) –completion of the Article 6 technical expert review of that report and theSBSTA recommendations

submission of the agreed electronic format;

Article 6.4: decision

Tables for submitting annual information as part of the regular

7/CMA.4, Annex I, para 26 –information, as referred to in decision 2/CMA.3, annex, paragraph

Supervisory Body23(j);Work-programme on reporting in 2023
Reference

MandateArticle 6.2:
decision
6/CMA.4, para17(e) – SBSTA
recommendations

Consideration of possible implications for the reporting of annual information pursuant
to decision 2/CMA.3, annex, paragraphs 20 and 23, from the application of methods
for converting the non-greenhouse gas metric into tonnes of carbon dioxide
equivalent in accordance with decision 2/CMA.3, annex, paragraph 22(d), with a viewto ensuring that the amount of internationally transferred mitigation outcomes in a nongreenhouse gas metric acquired by a participating Party does not exceed the amountof internationally transferred mitigation outcomes in the non-greenhouse gas metric of
the participating Party initiating the transfer;

Article 6.2:
decision
6/CMA.4, para17(j) – SBSTA
recommendations

The common nomenclatures referred to in annex I, chapter II.B, including forcooperative approaches reported by participating Parties, first transferring Party,
sectors, activity types, non-greenhouse gas metrics and their units of measurement,
registries that track internationally transferred mitigation outcome from cooperative
approaches and action types; first transfer specifications; and purposes towards which
use of internationally transferred mitigation outcomes is authorized;

Agreed electronic format▪ Decision 6/CMA.4, paragraph 4, requested that SBSTA continue its work on the draft
version of the agreed electronic format (AEF).
▪ Following the CMA 4 request, a workshop was conducted in April 2023, which

included a discussion regarding the AEF and, inter alia, a hands-on session.
▪ The document “Informal report on the hybrid workshop on the draft version of the agreedelectronic format” summarizes the output of that workshop regarding the AEF andpresents in its annex two different approaches to be considered by the Parties:▪ Extract from the table “Actions” the information related to authorizations and add it
into a different table, and▪ Create one table for each type of action and a table for holdings.

Sequency impact on reporting▪ As outlined in decision 6/CMA.4, annex II, paragraph 12▪ (Updated) initial reports are standalone reports and are reviewed by Article 6TERT after submission.
▪ Review periods: 3 or 6 months.
▪ Reports can be submitted together with regular information and have a joint
review by Article 6 TERT.

▪ Sequencing of the review may have implications for reporting and consistency
checks.

Sequency impact on reporting• Consider the following scenarios:• Where the AEF can be submitted independently on the initial report and its
review• where the AEF cannot be submitted unless the initial report has been
submitted/reviewed• where the information on ITMOs from a cooperative approach(es) for which
updated initial report has yet to be submitted/reviewed cannot be included in theAEF.
Start cooperativeapproach

Initial reportsubmission

AEF submission
Year 115 AprilYear 2

1 JanuaryYear 2

Review period

BTR Submission
Year 1 & 2
31 December
Year 3Sequency impact on reporting• Consider the following scenarios:• Where the AEF can be submitted independently on the initial report and its
review• where the AEF cannot be submitted unless the initial report has been
submitted/reviewed• where the information on ITMOs from a cooperative approach(es) for which
updated initial report has yet to be submitted/reviewed cannot be included in theAEF.
Start cooperative
approach

BTR, AEF (Year 1 & 2) +initial report submission

1 JanuaryYear 231 December
Year 3

Review period

AEF submission
Year 315 AprilYear 4

Annual information as part of the regular information (23(j))• Decision 2/CMA.3, annex, paragraph 23 (j) requests the information of paragraph23(c–e) to be provided with a detailed breakdown by the cooperative approach, sector,transferring Party, and using Party and vintage of the ITMO.
• Paragraph 23(c–e) requests:• Annual quantity of ITMOs first transferred;• Annual quantity of mitigation outcomes authorized for use for other international
mitigation purposes and entities authorized to use such mitigation outcomes, asappropriate;• Annual quantity of ITMOs used towards achievement of its NDC.
• This information is already provided in the AEF. These tables are not housed in theArticle 6 database.

Annual information as part of the regular information (23(j))
Table 2: Paragraph 23 (j) in relation to paragraph 23 (c) “Annual quantity of ITMOs first transferred”

First transfer destination
Reportedyear

Cooperative
approach

SectorAnnualParticipating Party inFirst
Annual quantity
Acquiring participating
quantity ofwhose registry thetransferringof ITMOs first
Party of international
Vintage Metric
ITMOs first“first transfer” isparticipatingtransferredtransfer that is a “firsttransferred
effected through use orParty(ITMO metric)transfer” as per(t CO2 eq)
cancellation as perparagraph 2 (a)paragraph 2 (b)Annual information as part of the regular information (23(j))
Table 3: Paragraph 23 (j) in relation to paragraph 23 (d) “Annual quantity of mitigation outcomes authorized for use
for other international mitigation purposes and entities authorized to use such mitigation outcomes, as appropriate”

First
Reported Cooperativetransferring
Sectoryear
approachparticipating
Party

OIMP

Authorizedparticipating
Parties orauthorized
entities

Vintage Metric

Annual quantity Annual quantity ofof mitigation
mitigation
outcomes
outcomes
authorized forauthorized
use for otherfor use for otherinternational
international
mitigation
mitigation
purposes (ITMOpurposesmetric)(t CO2 eq)

Annual information as part of the regular information (23(j))
Table 4: Paragraph 23 (j) in relation to paragraph 23 (e) “Annual quantity of ITMOs used towards
achievement of NDC”

Reportedyear

Cooperative
approach

SectorFirsttransferring
participating
Party

Vintage

MetricAnnualquantityof ITMOs
used towards
achievementof NDC(ITMO metric)

Annualquantityof ITMOs
used towards
achievementof NDC(t CO2 eq)

Methods for converting non-GHG: reporting implications• Decision 6/CMA.4 paragraph 17(e):• Consideration of possible implications for the reporting of annual information
pursuant to decision 2/CMA.3, annex, paragraphs 20 and 23, from the applicationof methods for converting the non-greenhouse gas metric into tonnes of carbon
dioxide equivalent in accordance with decision 2/CMA.3, annex, paragraph 22(d),with a view to ensuring that the amount of ITMOS in a non-greenhouse gas metricacquired by a participating Party does not exceed the amount of ITMOS in the nongreenhouse gas metric of the participating Party initiating the transfer.

Common nomenclatures•In order to perform consistency checks by the Article 6 database, it is crucial to establish
standard terms for denoting identical elements. Such terms are the common nomenclatures.

•Decision 6/CMA.4 paragraph 17 (j) enumerates a list of elements that have to be part of thecommon nomenclatures, including for cooperative approaches reported by participating
Parties, first transferring Party, sectors, activity types, non-greenhouse gas metrics and theirunits of measurement, registries that track internationally transferred mitigation outcome fromcooperative approaches and action types; first transfer specifications; and purposes towards
which use of internationally transferred mitigation outcomes is authorized.

•There is a need for a procedure to register common nomenclatures using CARP (alreadypresent in the detailed requirements of the CARP*)*Functional requirements for the centralized accounting and reporting platform and the Article 6 database

Expectations for CMA 5• Agreed electronic format: Adopting the AEF.
• Sequencing: Clarity regarding if the AEF can be submitted, depending on thesubmission/review of the (updated) initial report(s).

• Tables for reporting para 23(j): Adopting reporting tables for 23(j).
• Methods for converting non-GHG reporting implications: Clarity on methods for non-GHG conversion methods.
• Common nomenclatures: Clarity on common nomenclatures.