YK Poudel   

Bhutan is poised to enter the carbon market in partnership with Singapore. The negotiations with Druk Holding and Investments (DHI) will soon be completed, according to Energy and Natural Resources Minister, Gem Tshering.

Lyonpo emphasised Bhutan’s advantage in clean energy, citing the country’s lush forest cover. “The carbon business holds great potential for the nation,” he said.

As the world’s first carbon-negative country committed to maintaining carbon neutrality, Bhutan sustains emissions below carbon removal capacity of its forests, boasting a 69.5 percent forest cover.

With the launch of Bhutan’s National Carbon Registry on December 4, 2023, the country gained access to the World Bank climate warehouse, facilitating collaboration with global carbon markets.

The registry aims to elevate environmental ambitions, enhance capacity, and bolster climate resilience while supporting global efforts to mitigate greenhouse gas emissions.

Bhutan aims to promote sustainable practices and low-carbon solutions by exploring carbon market development and carbon credit generation.

Having signed the Paris Agreement on April 22, 2016, and ratified it in 2017, Bhutan aligns with Article 6 of the agreement. The Department of Environment and Climate Change (DECC), in collaboration with DHI, has established a national registry, utilising an electronic platform compliant with carbon unit identification and tracking guidelines.

Bhutan has integrated with the Climate Action Data Trust (CAD Trust) meta-data layer, a decentralized blockchain platform developed by the World Bank, International Emissions Trading Association, and Singapore in December 2022.

This integration aims to ensure accurate carbon tracking, accounting, and reporting of emission reduction units, advancing the country’s climate mitigation strategies and objectives through harnessing carbon finance.

The Carbon Markets Rules for the Kingdom of Bhutan 2023 outline procedures for entities seeking participation in carbon markets, requiring authorization from DECC for mitigation activities validated or verified according to procedures established by the National Environment Commission Secretariat.

In compliance with relevant national laws and international agreements, including the National Environment Protection Act 2007, Climate Change Policy 2020, and The Paris Agreement, Bhutan’s carbon registry is guided by legislative and policy frameworks aimed at environmental protection and climate action.