A report released on June 11, 2026, by the Myanmar Policy Institute, Global Forest Coalition and South Korean non-governmental organisation Plan 1.5 argues that the project at the centre of the debate may present broader challenges for the credibility of the UN-supervised carbon market mechanism.
The first carbon credits ever issued under the Paris Agreement’s Article 6.4 mechanism are facing growing scrutiny after civil society organisations raised concerns about alleged links to institutions controlled by Myanmar’s military junta, as well as questions surrounding human rights, governance and the accuracy of emissions reductions.
The controversy emerges at a critical moment for international climate policy, with governments gathered in Bonn for United Nations climate negotiations where the future of Article 6 carbon markets remains under discussion.
A report released on June 11, 2026, by the Myanmar Policy Institute, Global Forest Coalition and South Korean non-governmental organisation Plan 1.5 argues that the project at the centre of the debate may present broader challenges for the credibility of the UN-supervised carbon market mechanism.
RELEVANT SUSTAINABLE GOALS
Article 6.4 Carbon Market Reaches a Critical Test
The cookstove project became the first in the world to issue carbon credits under Article 6.4 of the Paris Agreement in February 2026.
Article 6.4 was established to create a United Nations-supervised carbon market mechanism designed to provide stronger safeguards and higher environmental integrity than earlier offset systems.
The project distributes improved cookstoves in Myanmar through a partnership between South Korea’s Climate Change Center and Myanmar’s Ministry of Natural Resources and Environmental Conservation (MONREC).
However, a new report titled Carbon Credits Under Fire: Myanmar, Crimes Against Humanity, and the Crisis of Credibility Facing the UN’s “High Integrity Carbon Markets” has raised concerns about whether the project meets the standards expected of a mechanism intended to underpin future international carbon markets.
Human Rights Concerns Linked to Project Governance
According to the report, the project continued operating after Myanmar’s military takeover and was implemented through MONREC, which served as the project’s primary government partner.
The report states that the ministry has remained under military control since the February 2021 coup.
It also notes that during much of the project’s implementation period, MONREC was headed by Colonel Khin Maung Yi, who was sanctioned by the European Union in June 2021 for supporting Myanmar’s military regime.
The report further highlights that the International Criminal Court has sought an arrest warrant for junta leader Min Aung Hlaing for alleged crimes against humanity against the Rohingya community. Proceedings relating to genocide allegations against Myanmar also remain before the International Court of Justice, according to the report.
Civil society groups argue that these circumstances raise serious questions regarding governance and accountability within projects seeking recognition under international climate frameworks.
Conflict Zones at the Center of the Debate
Particular attention has focused on the project’s implementation within Myanmar’s central Dry Zone, including Sagaing Region.
According to the report, the area experienced thousands of conflict-related incidents during the project’s crediting period, including airstrikes, artillery attacks, attacks on schools and healthcare facilities, and widespread displacement.
The report states that Sagaing now accounts for more than one-third of Myanmar’s internally displaced population. It also notes that women and girls in the region have faced high levels of conflict-related sexual violence.
Researchers argue that these conditions complicate efforts to independently verify project activities and outcomes.
Questions Raised Over Carbon Credit Calculations
Beyond governance concerns, the report challenges whether the issued carbon credits represent genuine emissions reductions.
Its authors raise concerns regarding monitoring methods, assumptions about cookstove usage and verification procedures.
According to the report, auditors were unable to conduct on-site inspections because of security risks and instead relied on remote interviews. The findings build upon previous analyses that questioned the project’s emissions accounting.
An earlier assessment conducted by Plan 1.5, Carbon Market Watch and researchers from the University of California, Berkeley concluded that the project may have been over-credited by more than 14 times under the previous Clean Development Mechanism framework.
A more recent evaluation by Carbon Market Watch found that even under revised Article 6.4 methodologies, the project is still likely to be over-credited by a factor of seven.
Plan 1.5 stated that while the United Nations reduced credit issuance by 40 per cent compared with the earlier methodology, the remaining volume still appears significantly overestimated.
Calls for Immediate Suspension of Credits
The organisations behind the report have called on the Supervisory Body of the Paris Agreement Crediting Mechanism to suspend any further issuance, transfer or use of credits associated with the project.
They have also requested an independent investigation into whether the project complies with human rights, environmental, social and methodological standards.
“Due to ongoing armed conflict on the ground, the data currently used to justify carbon credit issuance in Sagaing by the Burmese military junta is unverifiable and highly likely fraudulent,” said Zaw Tuseng, foundation director of the Myanmar Policy Institute.
He called for an immediate suspension of carbon credit transfers until a neutral and conflict-sensitive audit can be conducted.
Ma Nini Win of the Myanmar Policy Institute said climate interventions remain important in Myanmar’s Dry Zone, which faces worsening drought, irregular rainfall, flooding, water insecurity and environmental degradation.
“The real question is whether these interventions are designed and implemented in ways that are locally accountable, conflict sensitive, and responsive to community realities,” she said.
Broader Implications for International Carbon Markets
The report argues that the controversy extends beyond a single project and highlights wider credibility risks for the UN-supervised carbon market system. It also points to South Korea’s role in supporting and using the project.
According to the report, credits generated through the cookstove programme have previously been traded within South Korea’s Emissions Trading System, while major Korean corporations have publicly identified the project as part of their climate strategies.
“From the perspectives of human rights, gender equality and environmental integrity, this cannot credibly be described as a ‘high-integrity’ carbon project,” said Sooyoun Han, policy activist at Plan 1.5.
Han called on South Korea to strengthen safeguards to prevent low-integrity carbon credits from being used within its emissions trading system or counted toward national climate targets.
A Defining Moment for Article 6 Carbon Markets
As governments continue negotiations in Bonn, the dispute surrounding the first Article 6.4 carbon credits is drawing attention to the challenges of balancing climate finance, emissions reductions and social safeguards.
The report’s authors argue that the case highlights the need for robust oversight, transparent verification and stronger protections within emerging international carbon markets.
Munnion said the controversy raises broader questions about reliance on carbon offsets to meet climate goals.
“These credits must be revoked immediately, and the UN needs to seriously reassess its reliance on offsetting to meet climate goals,” he said.
With Article 6 carbon markets still in their early stages, the outcome of the debate may influence how future projects are evaluated and how confidence in global carbon trading mechanisms develops in the years ahead.
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