Compensation projects abroad

Countries can count reductions achieved abroad towards their emission reduction targets. The Paris Agreement replaces the flexible mechanisms of the Kyoto Protocol. Switzerland campaigns for clear international rules and draws up bilateral agreements with interested host countries.

International framework: Paris Agreement

The Paris Agreement permits emissions reductions achieved abroad to be counted in addition to domestic measures. The reductions in emissions must be additional, must promote sustainable development in the host country, and cannot already have been claimed by another country.

Article 6 of the Paris Agreement provides two options for transferring foreign emissions reductions (Internationally Transferred Mitigation Outcomes, ITMOs). Countries can define the modalities jointly on the basis of bilateral or plurilateral agreements (Art. 6.2). There is also a multilateral mechanism under the supervision of the Paris Agreement (Art. 6.4) which issues certificates for emissions reductions. The rules for implementing Article 6 were approved at COP 26 in Glasgow. Some technical issues still need to be finalised and the mechanism in Article 6.4 is yet to be implemented. The Confederation has already gained experience in implementing bilateral agreements in pilot projects run with the Climate Cent Foundation.

Implementation abroad

Since 2020, Switzerland has concluded several treaties with other countries which provide the basis for implementing the compensation scheme under Article 6.2 of the Paris Agreement. The FOEN publishes a list of the treaties and the partner states, which can be accessed here.

Project requirements and the process for issuing attestations for projects both in Switzerland and abroad are described here (in German, French and Italian).

Implementation in Switzerland

According to the total revision of the CO2 Act, up to a quarter of the reduction target of 50 % by 2030 compared with 1990 should be achieved abroad. This reduction should be brought about by the fuel importers subject to the obligation to offset emissions. Eligible international attestations must meet the requirements of both the Paris Agreement and the CO2 Act.

The statutory reduction target for 2020/21 should be achieved with domestic measures only. However, companies that are exempt from the CO2 levy may count a limited amount of foreign certificates towards their reduction obligation. These are issued in accordance with the international procedure set out in the Kyoto Protocol for additional emissions reductions that can be proven to have been achieved through climate protection projects in developing countries (Clean Development Mechanisms, CDM). These certificates must also meet the quality requirements of Annex 2 of the CO2 Ordinance