The role of international carbon markets in a decarbonising world

A growing number of countries have started to set longer-term climate targets and develop decarbonisation strategies in addition to their shorter-term commitments under the Paris Agreement. Depending on the country, offsets in the form of emission reductions or emission removals from abroad play various roles in how countries sketch out future planning. In the context of constantly ratcheted up ambition of national climate efforts under the Paris Agreement however, the role that such offsets can play requires a shift from the current practice of offsetting continued emissions trends to rapidly avoiding and reducing all emissions possible and going still further to draw carbon out of the atmosphere. In this paper, explore the new context and discuss what it means for both potential buying and selling countries on the way to a net-zero and net-negative carbon world.