COP30 panel: Scaling investment in renewables and nature-based carbon projects through global carbon compliance markets

Rapid global decarbonisation is essential to avoid the catastrophic costs of climate breakdown. Some of the most cost-effective opportunities lie in renewable energy and ecosystem protection projects in low- and middle-income countries. 

Yet, while voluntary carbon markets have opened the door for these projects, they struggle with generating the credibility, demand, and price signals to deliver investment at scale. 

Compliance markets, meanwhile, offer high integrity, predictable demand and high prices but so far remain largely confined to industrial emissions in wealthy nations, and only trade very limited quotas of non-industrial projects.

The recent announcement by Brazil of the Open Coalition on Carbon Compliance Markets, which will explore the long-term cross-country integration of these markets, opens the door to substantial gains in efficiency and create the potential for these markets to be a major source of funding for emissions abatement worldwide.

However, for this funding to reach low-cost renewable and nature-based abatement opportunities in low- and middle-income countries, emissions reductions from these projects need to be as credible as those from industrial emissions reduction projects. 

The Yale Economic Growth Center and the International Growth Centre are co-hosting a panel discussion exploring the institutional and technical innovations necessary for this. 

The discussion will address:

• What policies and governance could bring nature-based and renewable projects up to a standard that would allow them to be traded at scale in compliance markets?
• What financial structures would be needed to reduce moral hazard and risk?
• What measurement and verification systems will ensure credibility and trust?