UN 
On Friday, negotiators at the UN’s new global carbon market confirmed that the majority of legacy carbon credits—often dubbed “zombie credits”—will not be carried forward into the 2026 market framework. This outcome follows China and India’s decision earlier this summer to opt out of transitioning their older project credits to the new mechanism, effectively locking out a substantial share of previously eligible emissions offsets.
The market reform, anchored under Article 6 of the Paris Agreement, has been closely watched by sustainability professionals concerned about environmental integrity. According to Secretariat data released in Geneva, less than 12% of Clean Development Mechanism (CDM) projects, by volume, are now eligible to apply for transition under the new rules. China and India together accounted for over 60% of CDM credits issued before 2026, meaning their non-participation substantially reduces the risk of low-quality credits flooding the market.
The exclusion of these credits addresses long-standing concerns from environmental groups—especially those voiced at last month’s stakeholder forum in New Delhi—that the market could be undermined by offsets from projects with dubious climate benefits. “This is a significant barrier against greenwashing,” said Maria Fernandes, Policy Director at Carbon Market Watch, during a Saturday morning press briefing. “With the major suppliers staying out, the new market has a real shot at credibility.”
However, some participants warn that the move could increase compliance costs for corporations and governments still aiming to meet 2026 reduction targets. European buyers, in particular, now face rising prices for high-integrity offsets, with spot prices on the European Carbon Exchange up 17% since the start of July.
As Saturday street crowds in Shanghai and Mumbai remain largely unaware of the technical ruling, market participants across Africa and Latin America are recalibrating their strategies. Several project developers in Brazil and Kenya have already announced plans to seek new certifications under the updated UN regime, hoping to capitalize on the tightened supply.
Frequently Asked Questions
What are ‘zombie credits’ in the UN carbon market?
‘Zombie credits’ refer to legacy carbon credits from older projects under the Clean Development Mechanism (CDM) that are considered to have dubious climate benefits and will mostly be excluded from the new UN carbon market framework.
Why are most legacy CDM credits being excluded from the new UN carbon market?
Most legacy CDM credits are being excluded because China and India, which accounted for over 60% of these credits, declined to transition their old credits to the new market, addressing concerns about market integrity.
How much of the existing CDM project volume is eligible for transition to the new UN market?
Less than 12% of Clean Development Mechanism (CDM) projects by volume are eligible to transition to the new market framework.
How has the exclusion of legacy credits affected carbon offset prices in Europe?
European Carbon Exchange spot prices for high-integrity offsets have risen 17% since the start of July following the exclusion of most legacy credits.
Which countries’ project developers are seeking new certifications under the updated UN regime?
Project developers in Brazil and Kenya are seeking new certifications under the updated UN regime.
