Carbon Market Watch

Green Claims Directive: Open Consultation Carbon Market Watch’s response to the Green Claims Directive public consultation Introduction Carbon Market Watch welcomes the opportunity to provide feedback on the proposed Green Claims Directive (GCD).1 Misleading and unsubstantiated green claims are widespread and must be addressed.

Opening of the attached position paper · the full paper is on the Commission’s record (source link above)

The regular update of the benchmarks values for free allowances under the EU ETS is a necessary step to ensure that the last years of the free allocation system are fully coherent with the aim of a full phase-out by 2034 for all sectors, and provide the investment signals necessary to funnel funding into industrial decarbonisation.

Carbon Market Watch is concerned with the willingness of the European Commission to allow for domestic and international credits to account as carbon price paid in a third country. Not only this represents a discrepancy with the current EU ETS architecture, but sets a dangerous precedent that incentivises the establishment of crediting schemes with no qualitative safeguards. Our feedback is in the document attached.

Note: the following response is to be read together with the accompanying PDF that was attached, which contains sources and citations and develops our position in more detail. When carrying out its impact assessment, the Commission should consider that any option allowing the EU to rely on international credits to facilitate the achievement of its 2040 climate target is problematic for the following reasons: 1.

Carbon Market Watchs response focuses on the role of carbon dioxide removals planning and reporting within the Governance Regulation framework. Carbon Dioxide Removals (CDR) are measures and technologies that draw down carbon from the atmosphere and store it over relevant time horizons, so the removed CO2 can no longer contribute to climate breakdown.

When designing the post-2030 package, the European Commission must keep the long-term trajectory towards net-zero by 2050 at the latest and net-negativity thereafter in sight. Maintaining legally binding targets and robust progress reporting is necessary to ensure contributions by each member state.

There is no way around it: the EU LULUCF carbon sink is shrinking. The European Scientific Advisory Board on Climate Change (ESABCC) confirmed that the EU net sink has been declining rapidly over the last 10 years, decreasing by 2021 to a third of its 2005 total (ESABCC, 2024).