Designing the Article 6.4 Mechanism: Lessons Learned from the CDM - Key Messages and Recommendations

This policy brief analyses lessons from the Clean Development Mechanism under the Kyoto Protocol to guide the Article 6.4 market mechanism of the Paris Agreement. It highlights that while operational rules influence carbon credit supply, demand depends on external regulations and private sector engagement. The brief notes CDM successes in reducing emissions, identifies challenges for energy efficiency and small-scale sustainable development projects, and stresses the need for balanced credit supply and demand, environmental integrity, and concrete solutions to incentivise co-benefits and facilitate market participation.