Brazil is trying to build a coalition of countries, including the European Union and China, to unify carbon markets globally as it prepares to host this year’s COP30 climate summit.
Officials are working on a proposal to better integrate national emission trading systems and the standards that underpin them, according to a draft document seen by Bloomberg. The push is part of Brazil’s Action Agenda, which seeks to help countries implement their climate commitments.
The EU and China have expressed interest in joining the agreement, which may make it one of the most significant outcomes of the November summit, said people familiar with the matter. Still, the EU is wary about the proposal because of concerns that it may undermine the bloc’s strict standards, the people said.
Brazil’s COP presidency and the EU did not immediately respond to requests for comment. China’s environment ministry did not respond to an email seeking comment sent after office hours.
There are currently more than 40 carbon taxes and 35 emissions trading systems globally. “Inconsistent standards hinder market confidence, raise costs and disproportionately impact developing countries,” according to the document. “Brazil proposes the launch of an Open Climate Coalition with the aim to promote long-term convergence in carbon markets.”
About 28% of global emissions are currently subject to a carbon price, and markets are seen as a way of cutting emissions and generating revenue. Carbon markets raised roughly US$100 billion ($128.4 billion) in 2024, according to a recent report. A more global system also could address criticisms from developing countries that policies designed to prevent emissions from moving overseas, such as those deployed by the EU, put them at a disadvantage.
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Brazil’s draft proposal, which is subject to change, aims to develop common standards for monitoring, reporting and verification. It also would apply mutual-recognition schemes and coordinate criteria for the use of high-quality carbon offsets. The EU, for example, is considering allowing the use of carbon offsets to meet its its 2040 climate targets/
