Introduction
The Transfer of 30 Projects from CDM to PACM
The approval of the regulatory framework for the Paris Agreement Crediting Mechanism (PACM) at COP29 marked a turning point in the global carbon market structure. According to official sources, over 30 projects previously registered under the Clean Development Mechanism (CDM) have been formally transferred to the PACM, with recent activities from Nepal, Pakistan, Mali, and Benin. This migration is not simply an administrative recalibration: it represents a shift from a decentralized system to one structured on a global basis, with standardized procedures for the technical verification of emission reductions.
The PACM, established under Article 6.4 of the Paris Agreement, imposes stricter requirements than the CDM regarding additionality and traceability of decarbonization efforts. Each project must demonstrate that the emission reductions would not have occurred without the intervention of the credit, a criterion that the CDM has often applied with high margins of discretion. The migration of the 30+ projects indicates a convergence towards more consistent mechanisms less susceptible to systemic manipulation.
Technical Standardization and Centralized Verification
The implementation of the PACM requires the adoption of uniform technical procedures for assessing avoided emissions, monitoring carbon flows, and verifying long-term effects. In February 2025, during the meeting of the Supervisory Body of Article 6.4, the procedures for updating the PACM registry were finalized, including the transition of CDM projects and updated additionality criteria.
According to the ClearBlue Markets report, this step is crucial to ensure that the credits generated are verifiable, traceable, and consistent with national emission reduction targets (NDCs). The approval of the first project under the PACM – an efficient stove initiative in Myanmar – has demonstrated the operational capability of the mechanism, although it raises questions about scalability and the actual impact of the recorded reductions.
Systemic Impact on Global Markets
The effectiveness of PACM credits depends on their ability to integrate with other systems, such as the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) and carbon capture facilities. The mechanism allows the use of Article 6.4 Emissions Reductions (A6.4ERs) credits even in regulated contexts, but requires corresponding adjustments to avoid double counting of reductions.
The standardization of PACM has direct consequences for voluntary carbon markets (VCM), where demand for high-integrity credits is growing. Projects migrated from the CDM, if compliant with the new criteria, can generate additional credibility in international markets. However, this transition is not automatic: it requires a thorough technical review and updates to the monitoring infrastructure for each project.
Strategic Window for Global Consistency
The current transition phase represents a critical window to strengthen the integrity of carbon markets. Exceeding the threshold of acceptance of unverified reductions is now a structural risk, and the PACM offers a tool to contain this pressure.
The success of the mechanism will depend on the ability of developing countries – such as Nepal, Pakistan, Mali, and Benin – to implement reporting systems consistent with new regulations. The key indicator to monitor is the approval rate of PACM projects compared to the total number of requests: a value below 50% could indicate an insurmountable technical or bureaucratic barrier.
Critical Indicator to Monitor
If you measure the ratio between approved projects and requests within the PACM in the first six months after registering, you can assess how quickly national systems are integrating with new regulations. A value below 30% suggests that the mechanism is not yet practically operational for the most vulnerable countries.