The project that is summarised in this report had a twofold objective. First, it aimed to conduct a detailed analysis of the provisions related to market mechanisms of the Paris Agreement (Article 6), and to identify issues that should be taken into account when elaborating the rulebook for the Paris Agreement.

Current commitments under the Paris Agreement are not sufficient to limit global warming to well below 2°C above pre-industrial levels; the UNEP Emissions Gap Report 2015 showed that a mitigation gap of 14 GtCO2e exists for 2030. Against this background international climate initiatives can play an important role for reducing global emissions.

This report explores the introduction of carbon taxes with a national offset component and their interactions with other policy areas, and makes recommendations on this topic. In this task, the study focuses on the approaches Chile, Mexico and South Africa have chosen for elaborating their carbon taxes.

This report is a synthesis of the research and re-evaluates the options previously considered in this project (Vieweg et al (2014)) in the light of the negotiation process up to today.