Authorization forinternational transfer ofemission reduction
credits
26 September 2023

Support on authorization process
The policy framework provides a basis for participation by domestic entities

Authorization of Mitigation Outcomes for NDC or International Transfer
1

Identify
CA requirements• Depending on the Paris
Agreement, country andunderlying standard’s
requirements and buyer
preferences, the project ownerwill identify whether a project’s
associated MOs need CA.
• Unless there is a policy thatdefines the type and scope ofmitigation activities that are
eligible for NDC or internationaltransfer, project developers may
have to individually request forhost country approval andauthorization.

Country issues a letter ofApproval/ Authorization• The host government would
provide authorization based on
its own institutional and/ or policy
framework.
2• The host country may choose to
grant authorization for theissuance of a specific volume ofMOs from a project or sector.
• Authorization would ideally takeplace at an earlier stage toprovide greater certainty to theproject developer.

Record the need for CA
and apply CA• The country’s registry will
publish information on how
carbon assets are used, once
carbon assets are issued,authorized (if needed) andtransferred to another party.
3• Countries need an initial report
indicating the method chosenfor CAs, annual reporting of(indicative) CAs and biennial
reporting of (indicative) CAs
within the Biennial
Transparency Reports (BTRs).

• Authorization must be obtained
before first transfer.

2

Questions that countries should consider
Timing Issue
structuring the authorization process and timing of approval/ authorization (after validation/ verification/ flexible
timelines)
Should we establish process requirements for all markets? How to align the process with different market
requirements, if the case be?
Should authorization happen with each transfer, or can there be ‘thresholds’ on volumes and time period?
Contents of the Authorization
What are the minimum elements to be authorized? Cooperative approach, specific use, and participants?
Revocation of the Authorization
The Article 6.2 guidance indicates that any “changes to earlier authorizations” would need to be reported under theRegular Information reporting. What would such changes be and what would be the implications?
Revocation vs Not implementing Corresponding adjustment
OthersWould period of authorization be the same as NDC period? How would the in-between vintages be treated?
Reflections on the development of positive lists and whether it is intended that these sectors/ technologies would beapproved automatically
Incorporating progress with NDC implementation in the authorization process
Governing law and dispute resolution
3Letter of Authorization contents example (e.g., Ghana)
Mandate for Authorization• Name of authorizing entity and institutional arrangement• Cooperative approachPre-conditions for Authorization• Mitigation activity participants having satisfied all the pre-conditions and considered the technical recommendations
from Ghana’s Art 6.2 Committee on the mitigation activity
Authorization Statement• Grants formal Authorization of the ITMOs generated from the project• Guarantees recognition of the ITMOs and their use
Implications of Authorization & Confirmations• Confirms the host country’s participation in the cooperative approach• Commits to transfer the amount of authorized, verified, and positively examined ITMOso E.g.,ITMOs generated in respect of mitigation from 2021 ~ NDC implementation period up to 2030
• Commits to apply corresponding adjustment (accounting method) and not to use ITMOs for its own NDCSpecifies the governing law and dispute resolution process
Unforeseen Circumstances
4Delivered underPartnership for Market Implementation Facility (PMIF)
The two-fold objective of the PMIF is to contribute to the acceleration of global decarbonization efforts by:•Assisting client countries design and deploy explicit carbon pricing policies appropriate to theirdomestic context and compatible with their sustainable development priorities; and•Catalyzing the development of the next generation of international carbon markets.

PMIF will partner with relevant stakeholder groups to deliver assistance under four pillars:
Advisory and Analytics at country-level: Strengthen capacities
for development and implementation of domestic carbon pricing
instruments

Knowledge services: Develop the knowledge base on carbon
pricing instruments and facilitate knowledge exchange throughvariety of modalities and products

Innovation: Assist countries to identify and implement bestpractice approaches and, where relevant, achieve compatibility
in design to support the development of international carbonmarkets

Advocacy services: Policy discussions at various levels - withpractitioners, policy-makers and other relevant stakeholders - on
the role of carbon pricing as a key climate policy instrument

Official Use

Thank You!
Program links & resources:• Partnership for Market Implementation (PMI) - https://pmiclimate.org/• Partnership for Market Readiness (PMR) – https://thepmr.org/• Climate Warehouse - https://www.theclimatewarehouse.org/• Networked Carbon Markets - https://www.worldbank.org/en/topic/climatechange/brief/globallynetworked-carbon-markets• Innovate4Climate - https://www.innovate4climate.com/

Official Use