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Summary by Preetha Jenarthan, Gautam Jain, Luisa Palacios + 1 more • October 14, 2026
This event summary reflects the authors’ understanding of key points made in the course of the roundtable. It does not necessarily represent the views of the Center on Global Energy Policy. The piece may be subject to further revision. Contributions to SIPA for the benefit of CGEP are general use gifts, which gives the Center discretion in how it allocates these funds. More information is available here. Rare cases of sponsored projects are clearly indicated in published pieces.
Project-based carbon credit markets (PCCMs) enable the issuance, trading, and retirement of credits generated from projects that remove, reduce, or avoid greenhouse gas emissions. PCCMs can mobilize finance for decarbonization activities that might otherwise struggle to attract investment, while also in some cases delivering co-benefits such as protecting water, land, forests, and biodiversity. Historically, demand for these credits has come primarily from voluntary carbon markets, driven by corporate climate commitments, disclosure requirements, and investor expectations. More recently, compliance carbon markets and international mechanisms such as Article 6 of the Paris Agreement have emerged as additional sources of demand.
However, PCCM growth has slowed in recent years. Annual credit issuance in 2025 was about 40 percent below its 2021 peak, even as retirements of credits have remained steady, as demand is concentrating in high-integrity credits.[i] In addition to compliance schemes for carbon emissions reductions increasingly allowing the use of carbon credits, new approaches have emerged such as long-term offtake agreements and buyers’ clubs aggregating demand for high-quality credits. Concerns around credit integrity remain, but buyers also face uncertainty about how credits may be used, what claims can be made, what disclosure and assurance expectations are, and whether market infrastructure is available to support transparent and efficient transactions.[ii]
On September 24, 2026, during New York Climate Week, the Center on Global Energy Policy (CGEP) at Columbia University SIPA convened a private roundtable to focus on ways to address persistent demand- and market-side regulatory gaps. The discussion, held under the Chatham House Rule, brought together representatives from the public and private sectors, including government officials, multilateral development banks’ executives, carbon credit buyers, project developers, standard setters, registry operators, financial market participants, and other experts across the PCCM value chain.
The roundtable built on CGEP’s recent white paper examining PCCM regulations across G20 countries and Singapore.[iii] Among other insights, the white paper found that supply-side frameworks governing credit generation have generally advanced further than demand-side rules overseeing credit use and market-side rules covering trading infrastructure. Requirements for credit buyers remain inconsistent across jurisdictions, and formal market infrastructure and investor protections are unevenly developed. Against this backdrop, the discussion focused on the following questions:
The following is a summary of key insights that emerged from the roundtable discussion.
Participants first broadly recognized the progress made on supply-side regulations, particularly in strengthening carbon credit integrity. Several experts pointed to growing convergence around common quality thresholds, including the Integrity Council for the Voluntary Carbon Market’s Core Carbon Principles (CCPs). They noted that greater alignment around credible integrity standards could provide clearer signals to buyers, project developers, and investors while improving market liquidity and lowering transaction costs. One contributor highlighted how CCP-labeled projects have been successful in channeling capital into various nature-based projects while delivering co-benefits, such as biodiversity restoration, improving local livelihoods, watershed and soil protection, and sustainable management of forests. They also said governments could potentially reinforce these integrity signals, including by prioritizing CCP-labeled credits when purchasing or approving carbon credits under the Paris Agreement’s Article 6.2, which establishes a decentralized framework for bilateral trading of carbon units between countries.
Other participants cautioned against setting universal integrity thresholds at levels that may be viable only in jurisdictions with high carbon prices, as this could exclude projects and countries where such prices cannot be sustained, underscoring the need to retain flexibility for different crediting programs and national circumstances. One participant suggested that since the environmental impact of carbon credits can be quantified, it should be possible to create minimum thresholds for integrity that policymakers can require via regulations.
A recurring theme at the roundtable was that stronger supply-side integrity, while necessary for a well-functioning market, is not sufficient to generate demand. This shifted the discussion toward the demand-side uncertainties that continue to discourage buyer participation, such as how credits can be used, what claims can be made, how purchases fit within broader corporate decarbonization strategies, and what disclosure, accounting, and assurance requirements apply. Participants therefore emphasized the value of clearer guidance, regulation, and “safe harbor” approaches that have been proposed to reduce legal, reputational, and greenwashing risks for companies, giving them greater confidence to participate in the market.[iv] Regarding claims from the use of credits, one participant said it is difficult for policymakers to ascertain their validity, which complicates the task of drafting appropriate regulations.
But participants emphasized that greater clarity should not come at the expense of simplicity. One expert suggested that, rather than developing numerous competing national approaches, governments and standard setters could converge around a limited number of workable pathways for corporate credit use that provide greater certainty without imposing overly restrictive requirements.
Similar to progress on supply-side regulation, however, participants stressed that clearer demand-side rules would primarily help reduce barriers to participation rather than generate demand on their own. Stronger underlying demand drivers would still be needed to expand buyer participation and for the market to scale up.
Several experts emphasized that voluntary corporate purchasing alone is unlikely to sustain demand at the scale needed for PCCMs to grow. As an argument for diversifying demand drivers, one participant pointed to Microsoft’s outsized role in the carbon dioxide removal (CDR) market, noting that it accounted for roughly 80 percent of the durable CDR credit purchases to date.
Domestic compliance carbon market schemes that permit carbon credits, the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA), and international mechanisms under Article 6 of the Paris Agreement—which introduced a framework to facilitate voluntary cooperation between countries using carbon markets to help achieve their nationally determined contributions—were identified as more predictable sources of demand. A contributor highlighted the potential for greater convergence between voluntary and compliance schemes in the future, suggesting that it may be time to drop the term “voluntary” and refer to the market as an all-encompassing “project-based carbon credit market.”
The discussion also focused on how existing regulatory systems could create additional demand. One expert pointed to the potential for countries to link domestic carbon credit purchases to obligations associated with the European Union’s Carbon Border Adjustment Mechanism, while noting that this approach would require further analysis. They also added that Article 6 transactions could benefit from greater private-sector participation by permitting companies to buy and sell credits directly rather than relying primarily on government-to-government deals. As an example, they cited Singapore’s implementation agreements with host countries that allow for companies to transact commercially with each other, while the government handles authorization and corresponding adjustments.
Participants also stressed that demand from these sources depends on policy consistency and enforcement. One expert said that policy and methodology changes cause buyers and investors to hesitate because such changes limit their ability to make decisions based on expected future demand. Another cited CORSIA as an example of a scheme that has set clear rules but for which potentially uneven enforcement across jurisdictions could reduce demand if airlines do not comply.
Several participants emphasized the need to clearly articulate the use case for credits. Beyond purchasing requirements of compliance schemes and international mechanisms, several contributors thought that the rationale for buying credits could be broadened. One participant said governments can harness innovations via carbon credits, and some corporate buyers are already using credits to support technology deployment, climate adaptation, and resilience. Another pointed to sectoral decarbonization, in which credits are issued for reductions across a whole sector against a sector-wide baseline rather than for individual projects, as a more robust approach beyond traditional project-based offsetting.
One expert thought that focusing primarily on lower-cost mitigation and providing climate finance for developing countries may not provide a sufficiently compelling basis for greater demand. Instead, they pointed to tying credits more closely to opportunities associated with international partnerships, trade agreements, and technology exports, which can provide political and corporate support for purchasing credits.
Participants also questioned whether demand-side rules should apply equally to all companies. One contributor suggested they should apply only to large corporate emitters that have the financial and administrative resources to meet additional requirements, rather than imposing the same burden across a much broader group of companies. However, another pointed to the risk of creating loopholes while acknowledging that starting with larger companies before spreading the net wider is likely the right approach.
Roundtable participants also largely agreed that market infrastructure needs to develop further to support PCCM transactions. While regulated exchanges and registry-linked settlement are developing in some jurisdictions, for the vast majority, transactions are bilateral, which limits formal oversight, data transparency, and price discovery. Several experts also pointed to functions that are standard in more mature financial markets but remain less developed in PCCMs, including authoritative records of title, unique identifiers, settlement finality, custody arrangements, and standardized contracts.
Legal title emerged as a key area requiring greater clarity. One expert emphasized the importance of having authoritative records of ownership and clear rules governing the transfer of carbon credits, particularly to provide certainty over who holds legal title at each stage of a transaction. They added that without this clarity, building additional layers of market infrastructure could leave transactions resting on an uncertain legal foundation.
These legal foundations are already the focus of several ongoing initiatives. One participant highlighted the United Nations International Institute for the Unification of Private Law’s (UNIDROIT’s) work to develop private law principles for carbon credits, covering their legal nature and transfer, custody, insolvency, and registry records of legal title.[v] The participant also noted that classifying credits as commodities may not translate across varying legal systems of different jurisdictions and thought UNIDROIT’s approach of treating carbon credits as objects of property rights, allowing jurisdictions to determine their specific treatment under domestic law, was better.
Another participant suggested that treating carbon credits as assets can allow them to be held on a balance sheet and subject to traditional accounting rules. Others, however, raised questions about how to accomplish that, given credits are not backed by either cash flows or “consumption,” unlike wheat or oil futures.
In the context of this discussion, one participant highlighted the World Bank’s Legal and Regulatory Reform Toolkit for High-Integrity Carbon Markets,[vi] which provides countries with several options for developing national legal frameworks for carbon credits, including the implications of treating them as property or financial securities.
The discussion also focused on how greater legal clarity could support the development of more sophisticated financial infrastructure around carbon credits. One contributor explained that treating credits as regulated financial instruments could enable banks to provide custody, use them as collateral, and offer lending services and allow asset managers to hold them in investment funds and support the development of structured products. These functions provide certainty to investors and intermediaries, which in turn could deepen financial intermediation and increase market liquidity.
One participant asked whether carbon markets need a shared infrastructure layer, comparable to the systems that underpin other financial markets, such as registries, data standards, and settlement systems. The participant stressed that this layer would not necessarily be government-owned but could instead be industry-owned and -operated on a cost-recovery basis, providing common infrastructure on which private market participants could build. Others argued that regulatory oversight is also necessary, noting that financial markets have expanded successfully over the past century under government supervision. The appropriate governance structure, including who should own the infrastructure and who should oversee it, remains open to future analysis.
Participants differed, however, on how quickly these different elements need to develop. Some emphasized that functions such as authoritative title records and settlement certainty are foundational and should be established before more complex layers of infrastructure are built. Others cautioned against treating sophisticated exchanges or standardized contracts as prerequisites for market activity, arguing that transaction volumes may need to grow first and that additional infrastructure can develop alongside expanding demand.
Participants emphasized the value of greater alignment across jurisdictions as carbon credit markets become increasingly interconnected. This was not framed as a need for identical regulatory frameworks across jurisdictions. One expert noted that countries will continue to have different priorities but argued that rules should be sufficiently compatible for credits to be transacted across jurisdictions with confidence in their underlying characteristics.
One participant highlighted work by the Coalition to Grow Carbon Markets,[vii] co-chaired by the United Kingdom, Singapore, and Kenya, which is developing a policy playbook to grow demand for high-integrity credits, due to be launched at the UN Conference of the Parties (COP31) in Türkiye in November. The playbook is intended to set out policy steps that governments can adapt to national circumstances while supporting greater consistency across jurisdictions. The participant also noted the difficulty of developing jurisdiction-specific rules for areas such as corporate claims when many buyers operate across multiple markets and must navigate differing standards.
Implementation capacity was also raised as an important consideration, particularly for developing countries. One expert noted that countries are at varying stages of regulatory and market development and may need support not only to draft legislation but also to determine which regulatory elements should be prioritized. Capacity building and technical assistance were therefore identified as important for moving from regulatory design to implementation.
Supply-side integrity standards, clearer demand-side rules, and a proper regulated market infrastructure were viewed as distinct but complementary components of a functioning cross-border market. One expert stressed that all three need to work together, even if the specific regulatory approach differs across countries. Greater alignment can reduce fragmentation and make cross-border transactions easier, while preserving flexibility for jurisdictions to develop frameworks suited to their own legal and market circumstances can ensure that each country’s PCCM is viable.
[i] Authors’ calculations based on data from the “State and Trends of Carbon Pricing Dashboard,” World Bank, accessed September 29, 2026, https://carbonpricingdashboard.worldbank.org/.
[ii] Gautam Jain, Preetha Jenarthan, Victoria Prado, and Shubham Deshmukh, “Taking Stock of the Regulatory Landscape for Project-Based Carbon Credit Markets,” Center on Global Energy Policy, Columbia University, June 17, 2026, https://www.energypolicy.columbia.edu/publications/taking-stock-of-the-regulatory-landscape-for-project-based-carbon-credit-markets/.
[iii] Ibid.
[iv] Ruth Dagan and Hanni Maoz, “Unlocking Carbon Market Demand: How Safe Harbors Can Protect Corporations from Greenwashing Risk,” Herzog Fox and Neeman, May 3, 2026, https://herzoglaw.co.il/en/news-and-insights/unlocking-carbon-market-demand-how-safe-harbors-can-protect-corporations-from-greenwashing-risk/.
[v] UNIDROIT, “Verified Carbon Credits,” accessed October 2, 2026, https://www.unidroit.org/work-in-progress/verified-carbon-credits/#1637156948432-1d04168e-7a08.
[vi] World Bank, “Legal and Regulatory Reform Toolkit for High-Integrity Carbon Markets,” May 18, 2026, https://openknowledge.worldbank.org/entities/publication/764cd842-c99a-46dc-b62c-cac101480556.
[vii] https://coalitiontogrowcarbonmarkets.org/. Coalition to Grow Carbon Markets, “About Us,” accessed October 9, 2026, https://coalitiontogrowcarbonmarkets.org/about-us/.
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Summary by Preetha Jenarthan, Gautam Jain, Luisa Palacios + 1 more • October 14, 2026