A cleaner cooking initiative in Myanmar is set to generate the first-ever batch of carbon credits under the new UN carbon market, more than a decade after the mechanism was first envisioned in the Paris Agreement.

The Article 6.4 Supervisory Body has approved the issuance of 60,000 credits, which correspond to tonnes of carbon dioxide equivalent reduced by distributing more efficient cookstoves that need less firewood and, therefore, ease pressure on carbon-storing forests, the project developers say. The approval of the credit issuance will become effective after a 28‑day appeal and grievance period.

The programme started in 2019 under the previous UN-run carbon offsetting scheme – the Clean Development Mechanism (CDM) – and is being implemented by a South Korean NGO with investment from private South Korean firms.

The credits are expected to be used primarily by major South Korean polluters to meet obligations under the country’s emissions trading system – a move that will also enable the government to count those units toward emissions reduction targets in its nationally determined contribution (NDC), the UN climate body told Climate Home News.

Myanmar will use the remaining credits to achieve in part the goals of its national climate plan.

Making ‘a big difference’

The approval of the credits issuance represents a major milestone for the UN carbon market established under article 6.4 of the Paris Agreement. By generating carbon credits that both governments and private firms can use, the mechanism aims to accelerate global climate action and channel additional finance to developing nations.

UNFCCC chief Simon Stiell said the approval of the first credits from a clean cooking project shows “how this mechanism can support solutions that make a big difference in people’s daily lives, as well as channeling finance to where it delivers real-life benefits on the ground”.

“Over two billion people globally are without access to clean cooking, which kills millions every year. Clean cooking protects health, saves forests, cuts emissions and helps empower women and girls, who are typically hardest hit by household air pollution,” he added in a statement.

Concerns over clean cookstove credits

Carbon markets are seen as an important channel to raise money to help low-income communities in developing countries switch to less polluting cooking methods. Proceeds from the sale of carbon credits made up 35% of the revenue generated by for-profit clean cooking companies in 2023, according to a report by the Clean Cooking Initiative.

But many cookstove offsetting projects have faced significant criticism from researchers and campaigners who argue that climate benefits are often exaggerated and weak monitoring can undermine claims of real emission reductions. Their main criticism is that the rules allow project developers to overestimate the impact of fuel collection on deforestation, while relying on surveys to track stove usage that are prone to bias and can further inflate reported impacts.

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The project in Myanmar follows a contested methodology developed under the Kyoto Protocol that was rejected last year by The Integrity Council for the Voluntary Carbon Market (ICVCM), a watchdog that issues quality labels to carbon credit types, because it is “insufficiently rigorous”.

An analysis conducted last year by Brussels-based NGO Carbon Market Watch claimed that the project would generate 26 times more credits than it should, when comparing its calculations with values from peer-reviewed scientific literature.

‘Conservative’ values cut credit volume

But, after transitioning from the CDM to the new mechanism, the project applied updated values and “more conservative” assumptions to calculate emission reductions, according to the UNFCCC, which added that this resulted in 40% fewer credits being issued than would have been the case in the CDM.

“The result is consistent with environmental integrity requirements and ensures that each credited tonne genuinely represents a tonne reduced and contributes to the goals of the Paris Agreement,” said Mkhuthazi Steleki, the South African chair of article 6.4 Supervisory Body, which oversees the mechanism.

Over 1,500 projects originally developed under the CDM requested the transition to the new mechanism, including controversial schemes subsidising fossil gas-powered plants in China and India. But, so far, the transfer of only 165 of all those projects has been approved by their respective host nations, which have until the end of June to make a final decision.

The UN climate body said this means that “a wide variety of real-world climate projects are already in line to follow” in sectors such as renewable energy, waste management and agriculture. But the transfer of old programmes from the CDM has long been contested with critics arguing that weak and discredited rules allow projects to overestimate emission reductions.

Genuinely new projects unrelated to the CDM are expected to start operating under the Paris Agreement mechanism once the Supervisory Body approves the first custom-made methodologies.

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UN’s new carbon market delivers first credits through Myanmar cookstove project