If climate diplomacy were a relay race, then last year’s climate action summit handed the baton over to the upcoming COP30 in Belém, Brazil, with a sprint start on carbon credits. But as the world inches closer to an Amazonian showdown, the question looms: are we running fast enough to catch up with our climate targets?
Carbon credits took centre stage at COP29, where participating nations finally agreed to standards around a carbon credits system under Article 6.4 of the Paris Agreement. The goal? To create a global carbon market that incentivizes emission reductions and channels climate finance to where it’s needed most.
What are carbon credits?
At its core, a carbon credit is a permit that allows the holder to emit one metric tonne of carbon dioxide or its equivalent in other greenhouse gases. These credits can be earned by projects that reduce or remove emissions – renewable energy integration, regenerative agricultural practices, reforestation or methane capture – and then sold to entities looking to offset their own emissions.
The idea isn’t new. But what COP29 achieved was historic: a consensus on international standards for creating, verifying and trading these credits. This includes methodologies for calculating reductions, accreditation of third-party verifiers and a registry system to track transactions. Doing this will incentivize climate action by increasing demand for carbon credits and ensuring the international market operates under harmonized rules.
The finalization of negotiations for reaching consensus on Article 6.4 meant that countries could not only meet their nationally determined contributions (NDCs) to climate action faster but also help better channel climate finance by showing investors a clear path to trustworthy carbon projects. And given the system is based on cross-border cooperation, it allows new revenue streams and capacity-building opportunities to sprout in developing countries. Estimates from the World Bank suggest it could potentially result in reducing up to 5 billion tonnes of emissions by 2030 and unlock almost USD 250 billion in finance for climate each year.
Targets and timelines: a look back at previous COPs
Let’s rewind. At COP28 in Dubai in 2023, the world agreed to “transition away from fossil fuels” but stopped short of a full phase-out. The first global stocktake, where COP parties took stock of their implementation measures completed in 2023, revealed that current policies would lead to a 2,5 °C rise, far above the Paris Agreement’s 1,5 °C goal.
At COP29 in Baku, the “Finance COP”, the focus shifted to the urgent need for finance to accelerate climate action. Developed nations pledged to mobilize at least USD 300 billion annually by 2035 to support climate action in developing countries. Carbon credits were positioned as a key mechanism to unlock private finance.
But the wheels for this plan, Article 6, have been in motion ever since the Paris Agreement was ratified in 2015. And, finally, after almost a decade of meticulous work, countries have worked out an agreed way of how carbon markets will operate under the Paris Agreement, with operational crediting mechanisms which also allow cross-country trading. This Paris Agreement Crediting Mechanism (PACM) replaced the old Clean Development Mechanism (CDM) from the Kyoto Protocol, which allowed emission-reduction projects in developing countries to earn certified emission reduction (CER) credits, each equivalent to one tonne of CO₂. The new system today makes sure that the carbon credits are allotted based on measurable, verifiable emission cuts. The United Nations Framework Convention on Climate Change (UNFCCC) is working to operationalize the Article 6.4 Supervisory Body, which will oversee credit issuance and ensure compliance.
Since the Baku breakthrough, momentum has been building – but cautiously. Several pilot programmes and projects have launched to test the new system and countries like Singapore, Ghana and Switzerland are exploring bilateral credit agreements.
The sceptic’s view: are carbon credits a cop out?
Not everyone is sold on the carbon credit dream. Some environmental assessments argue that offsets can distract from actual emission reductions. Moreover, the USD 300 billion pledge, while ambitious, falls short of the estimated USD 1,3 trillion annual need for climate finance. Developing nations remain wary, fearing that carbon markets may favour wealthy emitters over vulnerable communities.
Meanwhile, private sector interest is surging. Tech giants, airlines and even fashion brands are eyeing carbon credits as part of their net-zero strategies. But critics warn that without rigorous oversight, the system risks becoming a “greenwashing” playground.
The market is still nascent. This also implies that there will be expected verification bottlenecks, lack of trust and fragmented registries, which slow adoption. However, work has been steady. In fact, in October 2025, the Supervisory Body met to review and approve initial market methods, supporting renewable energy projects.
Amplifying impact through conformity assessment and standards
Carbon credits don’t operate in isolation. They’re part of a broader ecosystem of existing and new climate tools which can work in synergy. For instance, through its IEC Quality Assessment System (IECQ), the IEC provides conformity assessment services that verify the carbon footprint of products and of organizations or even the emissions associated with the production, conditioning and transport of hydrogen as it becomes more prominent in the energy sector.
In a system where carbon credits will be the currency, verification becomes even more essential, ensuring the integrity of projects and hindering any greenwashing. Obtaining an IEC verification statement certificate gives independent assurance that an organization has prepared its carbon footprint claims in accordance with internationally agreed standards. These include:
- Carbon footprint of product (verification of compliance with ISO 14067)
- Carbon footprint at organization level (verification of compliance with ISO 14064-1)
- Carbon footprint of hydrogen (verification of compliance with ISO 19870)
The services are also in response to calls for an internationally harmonized approach to verifying such claims. These IEC environmental verification services are offered as “horizontal services”, meaning that they cover carbon footprint verification across a variety of different industries.
Tech manufacturers like Acer and ASUS have embraced these services. Achieving the IEC carbon footprint of product verification allows these companies to show their commitment towards to responsible innovation. Marie-Elisabeth d’Ornano, Convenor of the IECQ Green Approach Working Group, comments: “This first wave of IECQ carbon footprint verification certificates demonstrates how environmental conformity assessments can enhance trust, support supply chain decisions and enable sustainable competition on a global stage.”
A new environmental standard from the IEC
Moreover, the recently published international standard IEC 63372 will also address methods for quantifying and communicating greenhouse gas (GHG) emissions related to products. It describes principles and methodologies, specifies requirements and provides guidance for quantification and communication of carbon footprint for any product, as well as emission reductions and avoided emissions from electric and electronic (EE) products and systems. The IEC technical committee responsible for environmental standards, IEC TC 111, views it as an horizontal standard, applicable to all product technical committees.
A further example is the Global Digital Passport initiative, which is another way of supplementing transparency mechanisms. By tagging products with verified carbon footprint data, consumers can make informed choices, and companies can track emissions across supply chains. At the IEC, work is ongoing around digital product passport (DPP) activities, with a new proposal for an IEC/ISO joint technical committee on DPP.
The road to Belém: what will the IEC do at COP?
As COP30 approaches, expectations are high. Brazil has pledged to lead on nature-based solutions and indigenous rights. Carbon credits – especially those tied to forest conservation – will be a hot topic.
The IEC will be at COP30, highlighting the critical role of international standards and conformity assessment in driving the global climate agenda. Together with ISO, UL Standards & Engagement and other partners from the Standards Pavilion, the IEC will host a collaborative space designed to engage policymakers and regulators.
The Pavilion will showcase how existing standards serve as powerful enablers of effective climate action, supporting initiatives such as energy efficiency, renewable energy integration and safe and affordable access to clean energy. Of course, carbon footprint verification systems will be a big part of that offering. The hope is that COP30 will move from frameworks to fully-fledged implementation. But success will depend on political will, private sector engagement and civil society oversight.
Carbon credits aren’t a silver bullet, but they’re a powerful tool. The foundation is laid, but the work towards building the final system remains. As we follow the carbon trail from Baku to Belém, one thing is clear: the race to net-zero isn’t just about speed, it’s about direction. And with the right standards, digital tools and global cooperation, we might just get there in time.
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