UAE: National Register for Carbon Credits and its impact on business in the UAE

 

The UAE’s cabinet recently adopted Cabinet Resolution No. (67) of 2024, which aims to reduce GHG emissions to achieve climate neutrality in 2050 and regulate the registration of carbon credits in the nation.

Scope of application:

The Cabinet resolution applies to the following:

Entities with carbon emissions of more than 0.5 million metric tons of carbon dioxide annually (Entities of Huge Carbon Emissions),
Voluntarily applicable to entities that can bring their carbon emissions below 0.5 million metric tons of carbon dioxide annually with the advantage of trading in carbon credits (participating entitis), and
Trading platforms for carbon credits.

 

Measuring, reporting, and verification requirements:

The resolution provides comprehension methods and forms that shall be used to monitor and report carbon emissions.

The resolution directs the monitoring of emissions using the most updated methodologies based on the National System for Monitoring, Reporting, and Verification according to a baseline designated for 2019 or any later date.

The reporting requirements include the preparation of annual reports with the usage of basic approved standards in the Greenhouse Gas Inventory Protocol and requirements stipulated in the Paris Agreement.

The process of verification includes auditing by verification agencies as per the appropriate ISO standards.

National Register for Carbon Credits:

The Resolution establishes the National Register for Carbon Credits that complies with the requirements of the Paris Agreement. The Register will be used to prepare national reports for the Green House Gasses (GHG) emission inventory.

Earning carbon credits:

The Resolution defines a carbon credit as a certificate that includes the volume of carbon dioxide equivalent that was reduced during a certain period stated in the certificate. Such certificate is negotiable and allows its holder within the holder’s operations emissions that equal to credit recorded in the certificate.

Buying and sessions credits:

Entities of huge carbon emissions may buy carbon credits to compensate its greenhouse gas emissions and achieve climate neutrality. Further, the entities that received carbon credits from the National Register may sell their credits on carbon credit trading platforms since these credits are deemed to be financial instruments by the Resolution. The selling entities have to report their selling data to the National Register to ensure the amendment and validity of the carbon credits data.

 

For further information, please contact:

Thomas Paoletti, Managing Partner

Paoletti Legal Consultants, UAE

e: t.paoletti@paoletti.com

t: +971529113255

 

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