INTRODUCTION

International carbon markets are considered an important instrument for reducing global greenhouse gas (GHG) emissions cost effectively. The Paris Agreement in Article 6 recognised the importance of these markets, establishing a framework that accounts for rules, creates a new mechanism, and uses international trading emission allowances to facilitate emissions reduction targets for countries and companies [1].

Global carbon markets show different trends [2]: (i) Carbon prices are rising across different regions, both in compliance (through which regulated entities obtain and surrender emissions permits (allowances) or offsets to meet predetermined regulatory targets) and voluntary markets (which allow carbon emitters to offset their unavoidable emissions by purchasing carbon credits emitted by projects targeted at removing or reducing GHG from the atmosphere), generating incentives for countries and companies to invest in technologies or offsets to decrease GHG emissions. (ii) Greater climate goals increase the relevance of emission trading, and different countries and regions have committed to targets for reducing GHG emissions for the coming decades, which strengthens carbon markets as an instrument to trade and apply cleaner technologies and to benefit the economy and the environment by reducing the externalities of pollution. (iii) Financing of carbon trading. This mechanism offers both green, credible, and good returns that are fundamental for investors that allows them to access and understand the importance of the cost of pollution, increasing sustainability and reducing environmental problems. (iv) Markets must be both green and socially just, which presents an opportunity for governments to drive support and investments to help fund the transition to net zero. These trends are important for determining how carbon markets offer different alternatives to offset emissions as a strategy to achieve an adequate transition in the shift and substitution of fossil fuels.

Carbon regulation has generated different mechanisms, such as price mechanisms, emissions reduction incentives, carbon offsets, and investment in technologies to reduce emissions. This includes the application of carbon removal technologies through nature-based solutions that use ecosystems, such as forests, mangroves, kelp beds, and soils that naturally sequester or capture CO₂, and mechanical solutions that remove CO₂ from air or the ocean with direct capture technologies that use machines that create other carbon-based materials, including plastics, carbon-embedded cement, and rocks buried deep underground. Both alternatives can generate carbon offsets to be held, sold, and traded on exchanges to help compensate for carbon emissions occurring elsewhere. Different public and private organisations want to purchase verified carbon offset credits to reduce their overall emissions [3].

Offsets can be divided into two categories [4–6]: (i) Avoidance offsets are generated by activities that reduce future emissions through prevention, such as by building wind farms instead of new natural gas energy plants; in general, carbon markets can develop strategies to provide financial incentives to reduce emissions. (ii) Removal/sequestration offsets, such as those in forestry, which represents 40% of all offsets registered, or by mechanical removal with barriers, such as those related to materials and energy requirements and costs.

Compliance carbon markets aim to determine carbon price by laws or regulations that control the supply of permits, which are then distributed by national, regional, and global regimes. These permits are then traded within a controlled emissions trading scheme (ETS), which provides economic incentives to emitting organisations to reduce their carbon footprint [7]. Studies on compliance markets have analysed a variety of approaches, including the following:

These studies show the importance of compliance with the carbon market at the macro and micro levels and how policymakers and managers make decisions to reduce carbon emissions according to targets established through different strategies and mechanisms promoted by carbon markets. However, these studies have neither analysed the possibility of commercialising neutral fossil fuels through offsets that promote natural conservation nor investigated how countries that must import fossil fuels to guarantee their energy security could use these mechanisms or strategies in the energy transition process.

Voluntary carbon markets, where companies and individuals choose to offset their emissions, are not legally mandated. Organisations and individuals could be motivated by a desire to offset longer-term climate risks or by ethical or other reasons. Because carbon credits in voluntary markets are not administered by a specific government, they are accessible to every sector worldwide, in contrast to compliance markets [7]. Researchers on voluntary carbon markets have worked in the following areas:

These studies have produced important findings on the application of the voluntary carbon market for businesses and the challenges that firms face in determining strategies to apply offsets that contribute to reducing environmental problems and CO₂ emissions. However, the voluntary carbon market could offer possibilities for fossil fuels by commercialising offsets. For this reason, it is important to analyse this market because it could support neutral fossil fuels in the energy transition, which could help countries and producers of fossil fuels comply with their commitments to climate change and sustainability.

This background illustrates the limitations to analysing carbon markets related to the possibilities of fossil fuels, such as coal in energy transition, from perspective of commercialising offsets, which is fundamental for countries that depend economically on fossil fuels, as an alternative to. To reduce environmental pollution and promote sustainability, it is important to analyse this strategy to determine its possibilities and limitations. Hence, this study examines opportunities in the international carbon market to commercialise Colombian coal offsets from the forest economy for compliance schemes and in the voluntary market within carbon neutral and economic diversification strategies as examples or case studies. Colombia is an emerging economy that has a high dependence on the export of coal in its trade balance. It was the third largest exporter of coal, which is Colombia’s main mining export, in the world in 2021. Coal accounts for 56.1% of the contribution of the mining sector to gross domestic product and 0.74% of the sector’s contribution to the national gross domestic product. In productive regions, the coal industry generates approximately 130,000 jobs (75% in small and medium enterprises), and US$500 million in annual royalties (accounting for 88% of the royalties of the mining sector). Taxes are then used for investments to promote sustainable development in different regions of the country. Moreover, the strategic plan of this sector seeks to promote competitiveness, legality, security, best practices, adaptation, transition, diversification, and institutional strengthening [34].

Thus, the primary purpose of this study is to analyse opportunities in the international carbon market to commercialise coal offsets from the forest economy for compliance schemes and the voluntary market within carbon-neutral and economic diversification strategies using Colombia as case study due to the importance of coal for its economy and its position as a coal producer. This study can provide valuable help in creating strategies and inputs for policies that will contribute to sustainable development of fossil fuel production in the transition period and create opportunities to mitigate environmental problems and conserve natural landscapes and biodiversity. With this background, our study seeks to answer the following research questions: Question 1: How do compliance and voluntary carbon markets operate in Colombia, and what are the possibilities for commercialising Colombian offset coal? and Question 2: What is the potential demand for Colombian coal offset from the Climate Neutral Coal Strategy?

To answer these questions, a variety of methods were used, including a review and analysis of compliance and voluntary markets, and interest in productive sector of offsets. With these results, the potential demand for Colombian coal offsets is determined, which could aid producers, policymakers, and decisionmakers in leveraging new ways to commercialise coal using offsets, ultimately to support environmental protection and reduce environmental problems. The rest of the paper is structured as follows. Section 2 (METHODS) highlights the methods and data used in this study. Section 3 (RESULTS AND DISCUSSION) shows the results and presents the discussion and policy implications. Section 4 (CONCLUSIONS) presents the conclusion.

METHODS

Several methods were used in this study to determine opportunities for coal offsets according to compliance or voluntary carbon markets, considering the requirements and operations of these markets within Colombia’s carbon neutrality and economic diversification strategies.

For the compliance carbon market, we identify countries that could receive reduction certificates/offsets from the Colombian coal-identifying carbon-pricing mechanism (tax or emission trading schemes). The process enabled us to carry out offsets under the established price mechanisms by participating in the mechanism of the coal consumer/energy sector, among others. We reviewed different documents through dynamic consultations on the web for equations and web scraping using keywords related to compliance schemes of carbon markets and verified the quality of the documents and data. We also consulted with key stakeholders who have experience in compliance schemes. With these results, the possibilities for offsetting coal in the countries evaluated that could meet their obligations according to ETS are analysed.

In the case of the voluntary carbon market, the main companies that buy and use (not intermediaries) thermal coal and coke offsets to demonstrate their commitment to decreasing GHG emissions are identified. The features and trends of this market are determined in the industrial sector using a mixed method that includes a collection of secondary information to identify the main companies that work under voluntary market arrangements using equations with keywords and including the information in a matrix that identifies the main features and opportunities of the main coal-consuming companies.

In this stage, and accounting for the results of the previous analysis, the potential demand for Colombian coal offsets following the Climate Neutral Coal Strategy initiative is determined. Article 6 of the Paris Agreement and the results of the last Conference of the Parties (COP 26) are considered, using projections and comparisons that allow us to determine, according to the baseline, the possibility of applying this mechanism to promote coal offsets. Moreover, it used the following databases to define different industries interested in this market, such as Science-Based Targets and Bloomberg.

RESULTS AND DISCUSSION

In this section, the main results of the study are shown regarding the possibility of commercialising coal offset as a strategy to respond to the energy transition and to promote natural solutions and forest or reforestation processes in a biodiverse country such as Colombia.

Signed in 2016, the Paris Agreement marked a new era for carbon markets in which all countries contribute to global mitigation efforts. Countries frequently express their commitments at the national level, which affords the necessary flexibility so that they can contribute transparently and monitor their progress. In addition, each of the interest groups may sell and buy emission reduction certificates in a regulated or voluntary manner, considering the guidelines of Article 6 of the Paris Agreement, which provides the option for countries to generate and market mitigation results. At the international level, countries participate in mechanisms generated by governments and collaborations with noncommercial strategies. Figure 1 illustrates carbon market trends based on [35].

FIGURE 1

Figure 1. Carbon market trends. Source: Based on [35].

According to [36] in the Refinitiv report (2020), carbon markets are estimated to have grown by close to 20% (compared to 2017), which is equivalent to 229 billion euros based on transactions and carbon prices. Since the signing of the Paris Agreement, there is evidence that the regulated market has grown approximately fivefold since 2017, accounting for the limits established for carbon generation. Moreover, countries that signed the Paris Agreement should create mechanisms for clean projects such as green energy or carbon capture methods and technical innovations such as mitigation activities or taxes from climate change perspectives. These efforts could catalyse environmentally friendly companies to fulfil the commitments of the Paris Agreement [37,38]. Furthermore, new and innovative policies to promote energy transition could be designed to leverage carbon markets based on the promotion of cleaner technologies, conservation of the environment, and offset possibilities from Article 6 of the Paris Agreement.

According to [39], regulated carbon markets take six key elements into account: governance and accounting, scope and eligibility, environmental integrity, monitoring, reporting and verification, ensuring sustainable development, and links with other carbon pricing instruments. In the regulated carbon market, the leading mechanism is clean development (CDM), which was issued by the UNFCCC based on the database developed by [38], and the trends and dynamics of this mechanism. The total number of registered CDM projects for 2021 is 7857, which is comprises 93% of the 8419 active CDM projects. Seventeen projects are not in force because their certifications have already fulfilled the estimated reduction or validity period established and only 561 projects are still in the validation process. This has resulted in the issuance of 2096 million CERs, of which 1485 million were generated between 2008 and 2012 and approximately 611 million between 2013 and 2020. The CDM projects that have prevailed are those of renewable energy followed by the reduction of CH₄, cement, and coal mining. This is a promising sign that the neutral coal project has potential through this mechanism, which could be an alternative for countries that produce fossil fuels.

Regarding the location of the CDM, the Asia and Pacific region has the highest share of projects and CER emission certificates at greater than 80%, followed by Latin America with approximately 13%, indicating that these two regions have been fundamental in the development of this mechanism. With respect to countries in Asia, China stands out (with 56% of projects and 70% of credits), followed by India (with 29% of projects and 18% of credits). In Latin America, Brazil leads (with 35% of projects and 39% of credits), followed by Mexico (with 18% of projects and 15% of credits), and Chile (with 10% of projects and credits). The average costs of CERs range between US$0.4 for open CERs or those that do not have exclusivity in their sale or platform, and US$1–5 for CERs through the VC platform [40].

Most of the CERs (57.6%) generated from the CDM established by the Kyoto Protocol have been issued for projects in China and are mainly concentrated in the following eight countries in order of importance: India (11%), Korea (9%), Brazil (5%), Mexico (2%), and Chile, Afghanistan, and Vietnam (less than 1%). The countries that buy the most CERs are, in order of importance, the United Kingdom, Switzerland, Holland, Japan, Sweden, Germany, France, Spain, Italy, France, Austria, Denmark, and Finland. This indicates that European countries have mostly used this mechanism to mitigate their GHG emissions by compensation through the CDM. Outside of Europe, New Zealand is the country most interested in buying CERs.

Emission trading schemes have become fundamental to countries’ climate objectives based on the requirements of the Paris Agreement. According to [41], it is estimated that 54% of the jurisdictions that represent world GDP use this type of mechanism, 16% of global GHG emissions are covered by an ETS, and almost one-third of the world’s population lives with a current ETS. Table 1 shows the geographical distribution of this mechanism.

TABLE 1

Table 1. Distribution of ETSs worldwide.

Regarding compensation in carbon neutral and economic diversification strategy, the following must be considered. (i) Countries that do not accept compensation, such as Israel and Europe, are unable to use this strategy and must seek alternatives. (ii) The jurisdictions that accept forest sector compensation are Korea, Saitama, California, the Regional Greenhouse Gas Initiative (RGGI), Quebec, and Tokyo (which do not include the forest sector). (iii) The jurisdictions that are developing the compensation mechanism are China, Taiwan, Nova Scotia, Mexico, Chile, and Colombia. (iv) The jurisdictions that have not defined compensation mechanisms are India, Turkey, Massachusetts, and Brazil. This implies that, from the perspective of compensation, the strategy has potential, especially in Korea, Saitama, California, the RGGI, and Quebec, as long as the projects follow established methodologies and processes to obtain them. In addition, the compensation data for offsets are very limited, and several countries prefer not to accept them. Table 2 shows the main features of offsets in the countries studied and recommendations to commercialise neutral coal, indicating greater possibilities in countries that use coal to produce electricity and have flexible mechanisms.

TABLE 2

Table 2. Analysis of the main features of offsets in the context of carbon neutrality and economic diversification strategies.

According to their interests or as part of the compliance market, the voluntary carbon market is characterised by trade between buyers and sellers. The carbon offsets that are generated from projects that reduce emissions and are measured in metric tons of carbon dioxide equivalents (tCO_2eq) that are constituted in carbon credits, emissions reduction certificates, or carbon offsets, where each is equivalent to one ton of CO_2eq. A series of rules and procedures are followed to issue the respective credits, which need buyers who can be end users, retailers, or brokers who resell or charge a fee to find an end buyer. Currently, this market has a demand of approximately 95 MtCO_2eq/year, which represents 0.2% of global GHG emissions and is present in 83 countries [41,42]. Within the voluntary carbon market, the most prominent category of projects is related to forestry and land use issues that involve the management of forests, soils, grasslands, and other types of land to avoid the release of carbon and/or increase the amount of carbon absorbed by the earth. From 2016 to 2020, the number of projects grew to 187, achieving a reduction of 95.3 MtCO_2eq. During this period, an average of approximately 31 projects were approved per year, of which three projects per year belong to the REDD+ typology on average [43,44]. These results indicate that neutral coal could use REDD+ projects, especially in countries with natural resources where the conservation of forest areas is fundamental.

Regarding the use of carbon credits and/or offsets for the countries covered by this study, those with the highest number of offsets and projects are the US, followed by China and India. In the US, offsets and/or credits are registered in ACR and CAR, while in the other countries, VERRA (VCS) and GOLD predominate (see Table 3). Guatemala, Canada, and the US have the highest compensation in the forest category, while India concentrates its compensation on renewable energies (see Table 4). These results show the great potential that Colombia has in a voluntary market where the demand for these credits can be consolidated with other benefits, especially in the commercialisation of the carbon neutral strategy and economic diversification. These results show that the sale and/or commercialisation of credits or certificates in the voluntary market also depends on the entity in which it is registered, considering that VERRA and Gold obtain better prices and greater demand.

TABLE 3

Table 3. Data on the voluntary carbon market by country and standard.

TABLE 4

Table 4. Percentage of projects by category in the carbon market by country.

The price of carbon credits and/or certificates in the voluntary market depends on different elements, such as the type of project (based on the number of credits or certificates it generates and the interest of buyers in certain categories of projects) and the attributes of the project (which depend on the location, registration, standard, age, co-benefits, and additional impacts, fulfilment of sustainable development objectives, and community development). According to the latest study [42], forestry, land use, and housing and community projects have increased in prices mainly due to the additional benefits and impacts they generate. Likewise, the demand for credits and/or compensation for projects related to renewable energies, energy efficiency, and fuel changes continue to increase, especially in Asia, where the demand is approximately US$1 per ton. According to Bloomberg, the main buyers of carbon credits between 2017 and 2019 were Delta, Alphabet, Disney, Salesforce, and JPMorgan Chase & Co, who purchased these credits to avoid having to change their processes and to compensate for their emissions [46]. This indicates the importance of reviewing the volatility of the price of carbon credits when commercialising neutral coal to determine the effects on the cost of projects.

To identify potential companies that could be interested in participating in the carbon neutral strategy and economic diversification to offset their emissions, we worked with companies from five sectors in the energy supply chain: construction materials (cement, brick, and glass), iron and steel, food and paper. We took into account that several plants in these sectors use coal or thermal coal in some of their processes according to the International Energy Agency.

To select the companies in each sector according to the countries of interest in the study, the databases of [47–49] were reviewed. Companies that would be interested in buying into the carbon neutral strategy and economic diversification and/or having this type of compensation to meet their sustainability or GHG emissions commitments were considered. Importantly, the companies listed in this report already have experience and/or understand how the voluntary market operates or have internal GHG emissions reduction commitments, which would favour a neutral coal marketing strategy.

Figure 1 shows the number of companies selected by sector that could be interested in participating in carbon neutral and economic diversification initiatives either because they consume coal or have reduction commitments. There is a total of 239 companies, with the highest number concentrated in the energy supply chain, building materials, food, paper, and steel sectors. The principal regions or countries are Europe, the US, India, and Brazil, which coincide with the regions that buy the greatest quantities of coal from Colombia: Europe, Western Asia, and South America (see Figures 2 and 3).

FIGURE 2

Figure 2. Number of potential companies by industrial sector that could use carbon neutral and economic diversification strategies because they use coal or have reduction commitments. Source: [47–49].

These companies can generate various strategies. (i) In the case of multinationals, projects can be marketed at their headquarters to demonstrate environmental or social responsibility commitments. (ii) For local companies, the purchase or generation of credits could be used as a marketing strategy for the final consumer due to the current trend of generating responsible purchases, export possibilities, etc. (iii) For companies in the energy chain, carbon neutrality and economic diversification strategies could be managed through energy transition processes and/or social responsibility. All these elements are important for this strategy, verifying the business interests that allow win-win strategies for the productive sector through environmentally friendly processes.

FIGURE 3

Figure 3. Number of companies by potential countries to offer carbon neutral and economic diversification strategies. Source: [47–49].

In recent years, compliance and voluntary carbon markets have been growing. To the extent that more drastic policies are generated against emissions and the price of credits and/or offsets, this market manages to be above US$20 by credit. They will continue to grow, especially among companies and governments, with growth rates between 5% and 15%, depending on the type of market. In addition, it is estimated that the credits with the greatest commercialisation potential are those based on nature and that generate co-benefits. In this regard, Colombia has multiple possibilities that, connected with the commercialisation of carbon, could generate a competitive advantage.

The analysis by country shows that there is great potential for neutral coal in the Colombian regions and countries studied, accounting for the objectives of the established ETS, which in most cases include the electricity-generating sector with maximum compensation. This could generate demand for this sector of Colombian neutral coal in a conservative scenario of 5% to 10% of the credits and/or required offsets. In the voluntary market, the expectations are positive because many companies that use coal as an input and/or that are working towards emission reduction objectives could opt for this strategy of marketing coal with its related cobenefits. These elements will be fundamental in the analysis of the carbon neutral strategy in Colombia, and it is important to monitor the trends and policies that may affect the carbon market and that allow defining the changes or new strategies in the commercialisation of the Colombian neutral market.

Another important point in the analysis of the carbon market, both regulated and voluntary, is the typology of projects that are easier to market. For example, carbon credits generated by forestry projects and land use between 2016 and 2018 increased by 264%, while other types of projects grew by 21%, considering that the Intergovernmental Panel on Climate Change (IPCC) has highlighted the importance of “carbon sinks” as a strategy to meet the objectives and agreements of countries and companies. REDD projects that aim to reduce emissions from deforestation and degradation and afforestation and reforestation projects that focus on tree planting are included in this category [50].

Several of the countries that have a mandatory carbon market ETS have specific reduction targets and percentages of bonds and/or compensation that can be purchased either in general or by sector, which could be analysed and used by the country in the commercialisation of carbon neutrality. This is especially the case for ETSs that regulate the generation of electricity, particularly in Asia and Europe, where the possibility of compensation in a conservative scenario is between 2% and 5%. In the case of North America, it is important to have a rapprochement with the regional ETS, as this would increase the potential for commercialising carbon neutrality. With those Latin American countries where ETSs are starting or are under study, it could also work with short- and medium-term expectations. Table 5 shows a description of the compensation potential and recommendations for deploying the strategy by country.

TABLE 5

Table 5. Potential trade-offs and recommendations for carbon-neutral strategies and economic diversification by country.

It is estimated that the voluntary market could be in the range between US$5 and $50 billion by 2030, which is equivalent to a 15-fold increase, where multinationals and companies in the energy sector will continue to be potential users of this alternative. This implies that emissions trading will continue to be an alternative due to the flexibility and potential it offers to companies. However, to continue on this path of growth, it is necessary to continue strengthening quality processes in the value chain, project design and implementation, and transparency in the data and indicators that they issue in terms of emission reductions.

The rules established at COP26 offer the necessary framework to avoid double counting and require reports on how countries engage in carbon markets, subject to international review, that countries clarify and quantify their NDCs and that they establish incentives to expand the scope of NDCs over time. Currently, the challenge for the carbon market is that the relevant rules of Article 6 establish operations and applications that guarantee environmental integrity, which implies that each country provides evidence and manages to structure a solid accounting system [51].

For companies, the agreements reached allow them to be sure that global carbon markets support the trading of emissions reduction certificates or bonds without double counting. It will allow hybrid models for the corresponding adjustments made for transfers between countries, as well as with nonnational actors. It also provides a flexible approach to financing global adaptation through markets and will enable an orderly transition of Kyoto Mechanism activities to Paris-led markets in the mid-2020s [52].

In the analysis of coal offset possibilities, it is important to apply the broad principles proposed by Stern et al. [53] that promote effective climate decisions at the local and regional levels, which are as follows: (i) To analyse and evaluate stakeholders or users’ needs or requirements, (ii) to prioritise process over products, (iii) to link or relate information producers and users, (iv) to build and strengthen connections and relationships across disciplines and organisations, (v) to seek and guarantee institutional stability, and (vi) to promote knowledge and research to guarantee design for learning.

Moreover, the possibilities of coal offsets must include the potential of different political strategies to overcome the difficulty of achieving clean production by offsetting or decreasing efforts towards environmental protection in the whole value chain to model carbon offsetting with responsibility, transparency, additionality, monitoring, control, reporting and environmental and social contributions [54].

CONCLUSIONS

From the perspective of the carbon neutral strategy and economic diversification, the possibilities in the regulated carbon market imply that the ETS particularly includes the electricity-generating sector and industries that use thermal coal. The criteria with which it operates include emission limits, the percentage of external emission certificates that can be used to compensate in the international market, market flexibility, and free allocations. Compensations are limited to jurisdictions such as Korea, the Saitama Region, California, and the RGGI. In the case of taxes, the issue of prices and/or their reduction due to compensation could be reviewed, as proposed by Chile, for example, and the proposals that Israel is working on.

By country, due to the flexibility of its markets, allowing compensation and including free assignments, China, Turkey, India, Taiwan, and the Latin American countries could have greater potential for the strategy to the extent that the compensation guidelines are defined. In the case of Korea, which already has a maximum compensation limit, there could be opportunities from the current fuel transition that is being worked on, and in the case of Japan, the possibilities could be analysed with the Joint Credit Mechanism (JCM), which is a bilateral credit compensation mechanism to encourage low-carbon technologies, green investments and knowledge and develop R&D activities considering their impacts on reducing the ecological footprint and promoting sustainable development [55–57].

In the case of the European Union, compensation is being reduced; therefore, the opportunity of the strategy would be in sectors that have exceptions or countries with greater technological gaps. In the case of North America, as they are regulated markets at the regional level, it would be possible to work directly with companies by allowing compensation that includes forestry projects or with regional operators to market free assignments. In the case of Latin America, the evolution of the market should be expected, and the issue of prices for countries with taxes should be analysed. However, future monitoring is recommended for each of these countries in accordance with the commitments made at COP26.

For the carbon neutral and economic diversification strategy, at the time of having the projects, it is important to define the registration entity, as this is a fundamental factor to guarantee the ease of commercialisation and to obtain a better price per bond or reduction certificate, where registration entities such as the VCS and Gold stand out.

For this study, 239 companies from the energy chain, construction materials, steel, food and paper sectors were identified at an international level that may be interesting (either because they are consumers of coal or because they have commitments to reduce emissions or already participate in the voluntary market). In the carbon neutral and economic diversification strategy through the voluntary market and at the national level, 34 companies were identified. It is important to bear in mind that these companies would buy this type of reduction bond or certification to show their commitment to reducing greenhouse gases and social responsibility and to meet organisational objectives; they would not make changes to their processes and would be able to meet commitments.

This analysis makes it possible to demonstrate the potential that Colombia has to continue entering the voluntary market with innovative strategies and projects that are attractive from the supply and demand standpoints, from the volume of bonds to be generated and the cobenefits or additional impacts that they may generate. This could empower the productive sector, and in the case of the carbon-neutral strategy and economic diversification, it could be an opportunity to achieve its commercialisation in the medium term, seeking co-benefits and price improvements.

Based on these elements, carbon neutrality in Colombia has potential both in voluntary and regulated carbon markets. Initially, it could start in the voluntary market and hold specific negotiations with the countries that have a regulated market. In addition, including projects based on nature, especially reforestation and REDD, will be very beneficial since this sector is expected to experience the greatest growth in the creation of bonds. In addition, with the new rules of the COP26, there will be greater security, certainty, and integrity in accounting, which will be positive for the carbon neutral and economic diversification strategy. How the agreements are implemented to identify opportunities and strategies in their implementation should be monitored. In addition, it is recommended that a staggered route plan be created that allows the establishment of the necessary activities and actions to develop the strategy and begin the processes of commercialising carbon neutrality. Countries and sectors should be prioritised according to their potential in the regulated or voluntary market.

All these findings are important as inputs for developing a carbon-neutral marketing strategy for Colombia based on the different opportunities offered by the market. New policies related to emissions reduction and trading should be followed up to define adjustments or greater possibilities for this type of initiative, especially based on the results of COP26, new and/or updated NDCs and Article 6 of the Paris Agreement with respect to the cooperative approach (Article 6.2) and compliance crediting mechanism (Article 6.4).

DATA AVAILABILITY

The authors confirm that the data supporting the findings of this study are available within the article and that the data that support the findings of this study are available from the corresponding author upon reasonable request.

AUTHOR CONTRIBUTIONS

Clara Inés Pardo Martínez: Conceived and designed the analysis, wrote the paper and performed the analysis. Alexander Cotte Poveda: Contributed to data or analysis tools, wrote the paper and performed the analysis.

CONFLICTS OF INTEREST

The authors declares that they have no conflicts of interest.

ACKNOWLEDGMENTS

The authors would like to extend thanks to the reviewers for their comments and suggestions to the previous version of this paper and the GGGI and the National Mining Agency for comments and suggest for this study.