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28th Week Carbon Credit Markets 2025. UN, IETA, Brazil's ETS, Indonesia, Verra, criticism, tax incentives for CCS in the US, EU rejects more regulations but expands CBAM, Kabul without water and more.
- Art Dam
- Jul 20
- 5 min read
Monday, 21 July 2025.
- Carbon Credits. 🌱 Advances with new developments: the UN🇺🇳 launches a digital system to facilitate credits under the Paris Agreement; IETA defines priorities for the Brazilian market🇧🇷; Indonesia🇮🇩 releases transaction data; and Verra responds to criticism by reinforcing improvements to the voluntary market🌳.
- Other Highlights of the Week 28. The United States🇺🇸 expands incentives for carbon capture technologies; the European Union🇪🇺🌳 rejects a proposal to classify deforestation risk; and Kabul🇦🇫💧 faces imminent risk of water collapse.
- Opportunities. The European Union 🇪🇺 opens a public consultation on the expansion of the CBAM (Brazilian Legislative Assembly) to processed products; 🏆📽 Al Gore argues in a video that we have everything we need to overcome the climate crisis; and applications for the 🇧🇷🏆iCS Economy & Climate Prize.
- Events in August. Fastmarkets Latin America Carbon Forum (11), Australasian Emissions Reduction Summit (13–14), Forum on Promoting Business Engagement through the JCM (21) and IETA Latin America Climate Summit (26–28).
Here the details.
CARBON CREDITS
🌏 A new information system for the UN carbon market is now available.
The first module of the new Paris Agreement Crediting Mechanism Information System (PACM IS) is now publicly accessible, representing an important step toward greater automation and simpler workflows for users. It will serve as a single platform for all stakeholders, helping to simplify processes, reduce workload, and improve control of activities for host countries, project participants, and designated operational entities. Visit the new information system.
🇧🇷IETA has just released a report discussing the Brazilian carbon market.
The IETA report highlights the private sector's priorities for the development of the Brazilian Emissions Trading System (SBCE), created by Law No. 15.042/2024. The document emphasizes the importance of an environmentally sound, economically efficient, and socially fair system, with integration into the voluntary market and international mechanisms such as Article 6 of the Paris Agreement. Key points include the definition of credit generation methodologies (CRVEs), technical and independent governance, the inclusion of indigenous peoples and traditional communities, and clear guidelines on resource allocation and penalties. With COP30 approaching, the report reinforces that Brazil has a strategic opportunity to attract climate investments and consolidate its leadership in the global decarbonization agenda. Read more and access the 12-page document.
🇮🇩💰 Indonesia strengthens carbon market with new transaction data.
According to the latest report from the Indonesian Financial Services Authority (OJK), from its launch on September 26, 2023, to June 30, 2025, the country's carbon market recorded a total volume of 1,599,322 tons of CO₂ equivalent (tCO₂e), with a cumulative value of IDR 77.95 billion. The number of licensed participants on the Carbon Exchange remains at 112. This data reinforces the relevance of the carbon market as a financial and climate instrument in Indonesia.
⚖️ Verra responds to criticism and reinforces improvements to the carbon market.
Verra responded to academic criticism from the University of Pennsylvania Law School regarding flaws in carbon credit auditing, highlighting that just four auditors caused most of the problems and that corrective measures have already been taken, such as suspending validators and creating new methodologies approved by the ICVCM. The organization defends the independence of third-party auditing, which is commonly paid by project developers, and reaffirms its commitment to the integrity of the voluntary carbon market. Read Verra's full press release here.
HIGHLIGHTS OF THE WEEK
🇺🇸US strengthens carbon capture tax credit with new law.
On July 4, 2025, the United States passed the "One Big Beautiful Bill Act," which, among other things, strengthens the federal 45Q tax credit for carbon capture and storage (CCS) technologies. The new legislation maintains the credit amounts at $85 per ton for point-source capture and $180 per ton for direct air capture (DAC), guarantees the transferability of the credit between companies, and expands eligibility for uses such as enhanced oil recovery. According to the Global CCS Institute, this measure is seen as essential to accelerating the deployment of CCS projects, consolidating US leadership in the low-carbon sector, and boosting the country's industrial and energy competitiveness.
🇪🇺🌳European Parliament rejects deforestation risk classification system.
The European Union Deforestation Regulation (EUDR) is a benchmarking system proposed by the European Union that would classify countries according to the level of risk in the production of certain commodities in regions that are not deforestation-free. Products such as timber, soy, palm oil, coffee, cocoa, rubber, cattle, and derivatives (such as meat and leather) would be considered. The rejection of the European Commission's proposal on July 9th was mainly based on flaws such as using outdated data, ignoring forest degradation processes, and imposing excessive burdens on producers and forest managers. In addition to a broad and more scientifically in-depth review, a suggestion was made to include a new category called "no risk" for countries with expanding or stable forests—a level that does not exist in the current legislative proposal, which is limited to three categories: low, standard, and high risk.
🇦🇫💧Kabul may soon run out of water. Mercy Corps Report.
The capital of Afghanistan is facing an unprecedented water crisis, risking becoming the first modern city to collapse. Between 2001 and 2025, Kabul saw its population grow from less than 1 million to around 6 million, putting severe pressure on its water resources in an arid region. Aquifer levels have dropped between 25 and 30 meters in the last decade, with extraction exceeding natural recharge by 44 million cubic meters per year. Nearly half of underground wells are dry or contaminated, according to the UN and UNICEF. The crisis is worsened by climate change, reduced mountain snowpack, and decreased rainfall—directly affecting aquifer recharge. The cost of water has also skyrocketed, consuming up to 30% of household income. A Mercy Corps report highlights the urgency of coordinated investments in infrastructure and management to prevent a mass exodus from the city by the end of the decade.
OPPORTUNITIES
🇪🇺The EU has opened a public consultation on expanding CBAM to processed products. The consultation addresses measures against CBAM evasion practices and proposes adjustments to the rules for calculating emissions for the electricity sector. Participation is open until August 26, 2025, and will focus on social, economic, and environmental impacts.
🏆📽 Why Climate Action Is Unstoppable, and “Climate Realism” Is a Myth. Al Gore's video | TED, June 2025. A must-see with an optimistic message at the end: we have the tools, the knowledge, and the public support to confront the climate crisis.
🇧🇷🏆 The iCS Economics & Climate Award recognizes and encourages the production of scientific knowledge that contributes to aligning the economic agenda with climate action in Brazil. Applications are open here, and will be accepted until August 8th.
EVENTS
🇧🇷📍August 11, Fastmarkets Latin America Carbon Forum 2025. At the Renaissance Hotel in São Paulo, Brazil. Use code CCM15 for a 15% discount. Register here.
🇦🇺📍August 13-14, 12th Australasian Emissions Reduction Summit. At Centrepiece, Melbourne, Australia. Link.
🇮🇩📍August 21, Forum on Promoting Business Engagement and Matching through the Joint Crediting Mechanism (JCM) to Expand Indonesia’s Carbon Market. In Jakarta, Indonesia. Details here.
🇧🇷📍August 26-28, IETA Latin America Climate Summit, in São Paulo, Brazil. Details and registration here.
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