6 Dec 2023 09:57

Potential for nature-based climate projects limited by lack of access to high-margin carbon markets - Melnichenko

DUBAI. Dec 6 (Interfax) - Nature-based climate solutions (NBS) need a market, which would become a powerful incentive to implement them, the chairman of the Russian Union of Industrialists and Entrepreneurs (RSPP) Climate Policy and Carbon Regulation Committee, Andrei Melnichenko said at the UN COP28 climate conference.

Despite the great potential of NBS projects to absorb greenhouse gas, their implementation is limited, he said.

The main problem is that carbon credits received from NBS projects can be sold only on voluntary carbon markets, where the price ranges from $0.50 to $8 per tonne of CO2, which is not enough for projects to pay for themselves, Melnichenko said.

Meanwhile, the price per tonne of CO2 in the EU Emissions Trading System is about $100, but the results of NBS are barred from it because the rules for the operation of this and many other regulated carbon markets are dictated by providers of decarbonisation technologies in energy and industry, Melnichenko said.

He called for the creation of a market for NBS within the BRICS+ group of countries, where conditions could be created for mutual recognition of the results of climate projects in cross-border transactions. And projects can be implemented both in industry and energy and in natural ecosystems, as BRICS+ countries not only account for 40% of global greenhouse gas emissions but also have the greatest potential natural ecosystems, with over 30% of the world's territory and about 40% of the world's forests, Melnichenko said.

Melnichenko and Russia's special envoy for climate issues, Ruslan Edelgeriyev discussed this initiative with the secretary general of the Climate Vulnerable Forum, Mohamed Nasheed at COP28. It was noted that support for the initiative from the forum's 58 member countries would make the overall market for NBS more sustainable and in future market it possible to secure large amounts of financing for nature-based climate projects, including from developed countries.