Bhutan releases Carbon Markets Framework 2025 for Article 6 trading

The Royal Government of Bhutan released its Carbon Markets Framework 2025, operationalising Paris Agreement Article 6 with Internationally Transferred Mitigation Outcomes and corresponding adjustments. The high-integrity sovereign model offers Indian carbon-market participants and investors a regional precedent for credible, double-counting-free credit transactions.

The Royal Government of Bhutan released its comprehensive Carbon Markets Framework 2025 to guide national climate leadership and operationalise the Paris Agreement. It consolidates earlier reforms, the 2023 Bhutan Carbon Market Rules providing legal foundation and the 2024 Bhutan National Carbon Registry tracking mitigation outcomes, into clear operational procedures. The framework defines a structured project cycle: developers prepare a Mitigation Activity Design Document, undergo independent third-party validation for methodology compliance, and verify actual emission reductions through accredited entities to maintain environmental integrity.

The framework affects project developers, international buyers and investors in carbon assets. Governance runs through the National Environment Commission for policy oversight, the Climate Change Coordination Committee for technical advisory, and the Department of Environment and Climate Change (DECC) for implementation via its Carbon Market Unit. The DECC issues Letters of Authorization converting domestic outcomes into Internationally Transferred Mitigation Outcomes (ITMOs), applying Corresponding Adjustments to prevent double-counting under Article 6. The Bhutan Climate Fund aggregates credits and intermediates sales to international buyers, reinvesting revenues into community and ecosystem goals.

Carbon-market participants and international purchasers should note the authorisation pathway: projects need a DECC Letter of Authorization confirming national sustainable-development criteria, with Corresponding Adjustments applied to meet Article 6 requirements and prevent double-counting. Developers must complete the Mitigation Activity Design Document, third-party validation and accredited verification stages. Investors should monitor how the sovereign-backed framework de-risks climate investments and channels capital into renewable energy, forestry and sustainable transport, treating Bhutan's rigorous Paris Agreement adherence as a precedent for developing-nation carbon markets.

Key figure — Regulatory sequence: 2023 Carbon Market Rules, 2024 National Carbon Registry, 2025 Framework