March 6, 2026 — Chinese IFM Over-Crediting Exposed, WA-CA-Quebec Carbon Linkage, China NPC Sets 17% Target, India Formalizes Carbon Market

Top Stories This Week

1. Integrity Alarm: Five Chinese IFM Projects Show Zero Additionality, 3.7x Over-Crediting

Project: VCS2326 | Category: Integrity / Price Signals

A new study published March 2 found that five Chinese Improved Forest Management (IFM) projects on Verra showed no statistically significant evidence of additional carbon sequestration, with projected removals exceeding empirical satellite-based estimates by an average factor of 3.7x. This follows Verra's 2024 suspension of 16 Chinese IFM projects. The findings strengthen the case for remote-sensing-backed verification and will likely accelerate the discount already applied to Chinese forestry credits. Buyers holding exposure to IFM methodologies should reassess vintage risk.

2. North America's Largest Carbon Market Takes Shape: WA-CA-Quebec Linkage Draft Released

Countries: United States, Canada | Category: ETS / Compliance

On March 3, Washington, California, and Quebec released the formal draft linkage agreement to connect their carbon emissions trading systems — a step toward creating what could become one of the world's largest linked carbon markets. The draft outlines joint auction procedures and harmonized offset rules. For project developers registered under any of these programs, the expanded liquidity pool and price convergence signal improved market access.

3. China's NPC Unveils 17% Carbon Intensity Cut for 2026–2030

Country: China | Category: ETS / Carbon Pricing

On March 5, Premier Li Qiang announced a 17% carbon intensity reduction target for the 2026–2030 five-year plan, with a 3.8% cut for 2026. Notably, the previous five-year plan missed its 18% target, delivering only 12%. The announcement comes against a backdrop of intensifying enforcement: earlier this year, the MEE levied a record RMB 424M (~$59M) fine on a Ningxia power company for carbon allowance non-compliance, and six new industrial sectors (petrochemicals, chemicals, flat glass, copper smelting, papermaking, civil aviation) were added to mandatory emissions reporting requirements — setting the stage for ETS expansion in 2027.

4. India Formalizes Carbon Credit Trading Framework — Portal Launches March 20

Country: India | Category: Regulatory / Article 6

The Central Electricity Regulatory Commission (CERC) officially notified the 2026 Carbon Credit Certificates Regulations on March 3, operationalizing the legal framework for the Indian Carbon Market (ICM). Trading will take place on power exchanges, with Grid Controller of India as the national registry. BEE has announced a March 20 project registration portal launch, with first credit issuances expected by October 2026 after the April 2025–March 2026 compliance cycle concludes. For VCM participants, this is the supply-side event to watch: hundreds of Indian renewable energy projects could pivot from Verra/Gold Standard to the domestic compliance framework, tightening international supply.

Country Policy Monitor

750 findings scanned across 140 countries this week. Here are the most significant regulatory developments.

🇺🇸 United States: Carbon Market Linkage Advances as Federal Climate Policy Retreats

The WA-CA-Quebec linkage draft released March 3 is the biggest subnational climate development of the year. At the federal level, the administration formalized withdrawal from the UNFCCC and Paris Agreement in January. The PROVE IT Act was signed into law via FY2026 appropriations, mandating DOE study of emissions intensity of imports. CARB approved SB 253 regulations with an August 10, 2026 disclosure deadline for companies earning >$1B.

🇨🇳 China: NPC Sets 17% Carbon Intensity Target; Record Fine; Six New Sectors

The National People's Congress unveiled a 17% carbon intensity cut for 2026–2030 on March 5, with 3.8% for 2026 specifically. A draft Ecological and Environmental Code introduced during this session establishes the first statutory basis for carbon markets. Earlier this year, six new sectors were required to begin emissions reporting, and the record $59M Ningxia fine signaled aggressive enforcement.

🇮🇳 India: CERC Regulations Notified; ICM Portal March 20; First Credits October 2026

CERC formally notified the Carbon Credit Certificates Regulations on March 3. BEE's project registration portal goes live March 20, with first compliance credit issuances targeted for October 2026. The EU-India FTA text, published in late February, confirmed no CBAM exemption for Indian exports.

🇸🇬🇹🇭 Singapore–Thailand: Article 6 Deal Goes Live March 31

Singapore confirmed on February 28 it will operationalize its Article 6 carbon credit agreement with Thailand on March 31 — the fifth such deal Singapore has activated and the first with an ASEAN member. Thailand's cabinet also approved carbon credits for futures trading on TFEX in February, expanding the country's carbon market infrastructure.

🇯🇵 Japan: GX-ETS Price Corridor Set for April 2026 Launch

METI finalized the price corridor for the mandatory GX-ETS phase: a floor of ¥1,700/tCO₂ and ceiling of ¥4,300/tCO₂ for FY2026, rising annually by 3% plus inflation. The mandatory phase begins in April 2026, covering approximately 200–300 large enterprises.

🇩🇪 Germany: New Coalition Proposes Article 6 Credits for 2040 Targets

Germany's new coalition agreement proposed using Article 6 credits toward 2040 national climate targets — a significant policy shift that would create sovereign demand for high-integrity international credits. The Climate Action Programme 2026 is legally required by late March, and a new Carbon Contracts for Difference (CCfD) round including CCS/CCU is being prepared for mid-2026.

🇦🇺 Australia: Carbon Leakage Review Recommends CBAM

The final Carbon Leakage Review, released February 13, recommended a phased border carbon adjustment mechanism for Australia, initially targeting cement and clinker imports. The government's response will be incorporated into the 2026–27 review of the Safeguard Mechanism.

Quick Hits

• VCS2326: Study finds five Chinese IFM projects over-credited by 3.7x with no additionality evidence. (Carbon Pulse, March 2)

• CAR1459: Indigo Carbon's 5th issuance surpasses 2M cumulative verified tonnes; first ag credits to earn ICVCM CCP label. (PR Newswire, Feb 25)

• ACR260: Warm Springs Phase I forest project (Oregon) continues toward termination following 2020 Lionshead Fire; reversal of ~2.7M credits strains California's buffer pool.

• GLD5007: INOXGFL Group completes acquisition of Wind World India's 600MW portfolio via insolvency resolution. (ET Energy, Feb 19)

• ICAO TAB 2026 assessment cycle closes March 9 for CORSIA Phase 2 (2027–2029) eligibility applications.

This Week by the Numbers

158 verified project findings across 134 projects | 750 country policy findings across 140 countries

Top project categories:

• Proponent Activity: 30 findings — Corporate exits, acquisitions, financial reporting

• Operational: 28 findings — Infrastructure upgrades, ownership transitions

• Market/Offtake: 24 findings — Investment deals, offtake agreements, platform listings

• Project Status: 24 findings — Registry transitions, terminations, monitoring updates

• Regulatory: 13 findings — ETS inclusion, Article 6 authorizations, CCP labeling

• Integrity: 9 findings — Over-crediting studies, performance disclosures

Top policy categories:

• ETS/Carbon Pricing: China NPC targets, WA-CA-Quebec linkage, Japan GX-ETS pricing

• Article 6: Singapore-Thailand operationalization, Germany coalition proposal

• VCM Regulatory: India ICM framework, Australia CBAM recommendation

• CORSIA: TAB 2026 cycle closing, Phase 2 eligibility applications

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