COM/ENV/EPOC/IEA/SLT(2021)4
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3. Timing issues related to ITMO accounting and corresponding adjustments Under draft A6.2 guidance, Parties are required to report, i.a. information on their emissions balance, ITMO transfer and use, and corresponding adjustments. Under the MPGs, this same information will implicitly be needed to report an “emissions balance […] adjusted on the basis of corresponding adjustments undertaken by effecting an addition for ITMOs first-transferred/transferred and a subtraction for ITMOs used/acquired” (§77.d of draft the MPGs). ITMOs can be generated in different ways, including via the international transfer of mitigation outcomes from activities registered under the Article 6.4 mechanism. There can be a variable and potentially long time lag between when ITMOs are generated and when they are authorised, transferred and used. However, there is limited guidance in draft A6.2 guidance in terms of e.g. timing of ITMO reporting and timing of application of corresponding adjustments. This section provides an overview of the impact of time lags and other timing issues that relate to ITMO accounting, application and reporting of corresponding adjustments in the context of A6.2 reporting, and the interplay with other reporting requirements under the MPGs.12
3.1. Time lags between transfer and use of ITMOs There may be a significant time lag between the year in which mitigation outcomes are generated and the year in which they are internationally transferred (see Figure 5). Unless specific provisions on the validity period for an ITMO are introduced, there could also be a significant time lag between when an ITMO is acquired and when it is used. This will mean that a country’s emissions balance in a given year can differ from its level of national GHG emissions in the scope of its NDC, as laid out in paragraph 77.d of the Annex to decision 18/CMA.1. This can have significant implications on the time series of information that would
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It is not yet clear whether ITMOs will be solely in GHG metrics, or also in non-GHG metrics. In order for reporting and review of any ITMOs in non-GHG metrics to meet the TACCC principles, additional elements may need to be included. However, discussion of this issue is outside the scope of this paper.
Unclassified
