The European Commission is preparing purchasing rules that would stop nature-based Article 6 credits from counting at full value toward the bloc’s 2040 climate target if international standard-setters fail to deliver sufficiently robust integrity rules, Carbon Pulse reported on Friday. The move would insert a formal quality discount into what is shaping up to be one of the largest sovereign credit procurement programmes in carbon market history, and it lands while the detailed eligibility legislation for the EU’s international credit window is still being drafted.
The Demand Programme the Rules Would Govern
The scale at stake is not trivial. Under the political agreement reached on December 10, 2025, the EU committed to a 90 percent net greenhouse gas reduction by 2040 compared to 1990, with up to 5 percentage points deliverable through high-quality international credits. Analysis by Climate & Company puts that flexibility at roughly 232 Mt CO2-equivalent in 2040 alone, and around 900 Mt cumulatively over 2036-2040 under a realistic linear build-up, preceded by a 2031-2035 pilot phase.
The ETS review package published on July 17 converted that flexibility into a procurement architecture. The Commission proposed a central facility to buy up to 260 MtCO2e of high-integrity international credits between 2036 and 2040, funded by auctioning an equivalent volume of ETS allowances. Detailed eligibility criteria were deliberately left to separate legislation, with further proposals expected later in 2026. That follow-up legislation is precisely where the reported discounting rules for nature-based credits would sit.
Why Nature-Based Units Are in the Firing Line
The concern is durability. Forestry, soil and other land-based credits carry reversal risk that engineered removals do not, and Brussels has already shown the same instinct domestically. When the July review opened the EU ETS to carbon removals for the first time, it limited eligible pathways to BioCCS and DACCS certified under the Carbon Removal Certification Framework, deferring any decision on carbon farming and other nature-based removals to an assessment due by the end of 2034.
Applying the same durability filter to imported Article 6 supply would be consistent with that logic. It also echoes pressure from the NGO community: environmental groups including EDF and The Nature Conservancy published a safeguards framework in May 2026 arguing that any EU use of international credits must be underpinned by strict quality criteria to avoid turning the 5 percent window into an offset loophole.
The Backstop Machinery Already Exists
The discounting proposal is not the only safeguard in the architecture. Article 9b of the ETS review requires the Commission to assess by January 2033 whether a sufficiently robust market for high-integrity international credits has emerged, examining environmental integrity, accounting robustness, verification standards, liquidity and available supply. If the answer is no, the post-2035 linear reduction factor rises from 1.7 percent to 2.7 percent, forcing ETS sectors back onto a fully domestic pathway.
Climate Commissioner Wopke Hoekstra was explicit about the firewall between the ETS and the credit window. “We’re not asking more for the ETS from the ETS sectors, we’re also not asking less,” he said at the July 17 press conference, confirming that only around 2 percentage points of the 5 percent flexibility would apply within the ETS cap, with the remaining 3 points outside it.
What This Means for Buyers, Developers and Investors
For developers of forestry, REDD+ and soil carbon projects positioning for European Article 6 demand, the risk profile has shifted. A credit that counts at less than face value toward the 2040 target will trade at a structural discount to both engineered removals and reduction credits that clear the integrity bar. Feasibility models built on assumed EU demand at par value need revisiting now, before the eligibility legislation locks in definitions.
For buyers and investors, the emerging structure creates a two-tier international credit market governed by Brussels’ purchasing rules rather than by voluntary integrity labels alone. The price spread between nature-based and engineered Article 6 supply, once EU procurement criteria are published, will be the market’s first compliance-grade signal on durability, similar to the spread forming in CORSIA-eligible units.
For standard-setters, the message is blunt. The Article 6.4 Supervisory Body and voluntary integrity initiatives now have a de facto deadline: deliver rules robust enough for Brussels, or watch the largest future sovereign buyer discount the asset class they certify.
What to Watch
Three markers from here. First, the text of the separate eligibility legislation expected later in 2026, which will show whether discounting takes the form of a quantitative haircut, a usage cap, or outright exclusion for certain credit types. Second, the January 2033 Article 9b assessment, which converts the safeguard from design into a binary market decision. Third, whether the European Parliament and Council, both still forming positions on the ETS review, push to tighten nature-based provisions further or resist a durability hierarchy inside the 2040 architecture.
