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Norway commits $740m to boost global carbon credit market

At COP29 in Baku, Norway unveiled its largest financial commitment yet to the global carbon market: a $740 million initiative to purchase carbon credits under the Paris Agreement’s Article 6. This bold move aims to drive demand in the emerging international carbon credit market.

Norway commits $740m to boost global carbon credit market_An aerial view of the expansive deciduous forests in the Østlandet region of Norway_visual 1An aerial view of the expansive deciduous forests in the Østlandet region of Norway. AI generated picture.

The initiative, named the Norwegian Global Emission Reduction (NOGER), will prioritise renewable energy projects and phase out fossil fuel subsidies in countries like Benin, Jordan, Senegal, and Zambia. Norway’s Parliament has allocated $740 million (NOK 8.2 billion) for the 2024 and 2025 budgets to fund these efforts.

Minister of Climate and Environment Tore Sandvik emphasised the stringent standards for emission reduction activities, ensuring third-party verification and safeguards against corruption and human rights abuses. ‘Norway's approach is to put host countries in the driving seat... They know their countries best. But that doesn't mean we don't have high expectations’, he said.

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Norway also announced the creation of the $100 million Norwegian Article 6 Climate Action (NACA) fund under the Global Green Growth Institute (GGGI). This fund will manage carbon trading programmes and ensure robust policy frameworks for effective carbon markets. Additionally, Norway is in talks with the Asian Development Bank to contribute $50 million in 2025.

In Benin, an Article 6 agreement with Norway was finalised in just seven months, a record-breaking pace praised by GGGI. Zambia and Senegal have also signed agreements with Norway, signalling a growing commitment across Africa to leverage carbon trading for renewable energy investments.

This initiative aligns with Norway’s ambitious environmental targets, including a 55% reduction in emissions by 2030 and a planned 2035 goal incorporating international offsets. Critics, however, note the paradox of Norway’s vast hydrocarbon exports and the need for more aggressive action in reducing oil-related emissions.

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At DGB Group, we enable businesses and individuals to address their carbon footprints with nature-based solutions that deliver both ecological and socio-economic advantages. By restoring ecosystems and advancing global reforestation, we ensure that every action taken toward carbon compensation contributes to a sustainable future. As demonstrated by initiatives like Norway's bold commitment to carbon markets, decisive action is crucial in today’s landscape. Companies must lead the charge in reducing emissions, fostering a healthier planet while driving positive environmental and economic change.

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