Saudi Arabia's GCOM: how the Kingdom's carbon crediting mechanism works

Karbuna

Oct 5

4 min read

Sand dunes and rocky mountains in the Saudi Arabian desert

Saudi Arabia has built its own route for turning emission reductions into credits. The Greenhouse Gas Crediting and Offsetting Mechanism, known as GCOM, is a national scheme run by the government rather than by an international standard. This article explains what it is, how a project moves through it, and where it stands as at October 2026.

What GCOM is

GCOM is a voluntary crediting mechanism operated by Saudi Arabia's Designated National Authority (DNA), the body that previously handled the Kingdom's Clean Development Mechanism projects under the Kyoto Protocol. The Energy Minister, Prince Abdulaziz bin Salman, first announced it at COP27 in November 2022, and the DNA formally unveiled it at MENA Climate Week in Riyadh in October 2023, describing it as the first market mechanism of its kind in the region.

The purpose is domestic. GCOM gives companies operating in Saudi Arabia a way to register projects that cut or remove greenhouse gases, have the reductions verified, and receive serialised credits that can be sold to other Saudi entities or used to offset their own emissions. It sits alongside, and is designed to be compatible with, Article 6 of the Paris Agreement. It is distinct from the Regional Voluntary Carbon Market Company (RVCMC), the Riyadh exchange owned by the Public Investment Fund and the Saudi Tadawul Group, which trades credits issued under international standards; GCOM is about generating credits inside the Kingdom.

Who can take part and what qualifies

The DNA's guideline, issued in July 2023, opens GCOM to public and private entities in any sector, including Saudi subsidiaries of foreign companies. Priority sectors are energy efficiency, renewable energy, industrial processes, transport, forestry, carbon capture, livestock and waste management.

Two conditions matter for anyone planning a project:

Carbon rights. The project proponent must hold uncontested legal rights to the emission reductions, and the project must not be registered under another mechanism such as the CDM or an international voluntary standard.
Additionality. The project must pass a three-level test: it goes beyond what current law requires, it is not already standard practice in the industry, and it faces at least one real barrier (financial, technological or institutional) that crediting helps overcome. Baselines must be set below business as usual.

The eight-step project cycle

GCOM follows a cycle that will be familiar to anyone who has worked with the CDM or the main voluntary standards:

Preparation of a project design document.
Validation of that document by an independent verifier accredited by the DNA.
Submission of the validated documentation to the DNA.
A 15-day public stakeholder consultation, followed by registration in the GCOM Registry.
Monitoring of the project by the proponent against the registered plan.
Verification of each monitoring report by an accredited verifier.
DNA review and approval.
Issuance of serialised credits into the registry.

Crediting periods are seven years for forestry projects, renewable twice to a maximum of 21 years, and either a fixed ten years or three renewable five-year periods for other project types. The DNA charges no fees of its own; validation and verification are contracted directly with the verifier.

The registry and Article 6

The GCOM Registry is run by the DNA and records each project, its credits, and every issuance, transfer, cancellation and retirement, each credit carrying a unique serial number. The guideline provides that GCOM credits may be authorised by the DNA for use as internationally transferred mitigation outcomes under Article 6, which would require a corresponding adjustment in Saudi Arabia's national accounts. The detailed rules for that step are still being settled as Article 6 implementation matures internationally.

Where it stands in October 2026

GCOM is operational as a registry and a rulebook, and the mechanism is at an early stage of building its project pipeline. No public tally of registered projects or issued credits has been published, and commentary through 2026 describes the detailed regulations as still being finalised. The Riyadh exchange has so far traded credits issued under international standards, which is where GCOM is designed to add a domestic route.

Two developments will shape GCOM's role. The first is Saudi Arabia's planned compliance carbon market, expected to begin with a phased pilot around 2027; the King Abdullah Petroleum Studies and Research Center has urged that the two schemes be coordinated from the start so that credits from one can be recognised in the other. The second is the Saudi Green Initiative's land targets of ten billion trees and 40 million hectares restored, which would need a domestic crediting route of exactly GCOM's kind if the restoration is to generate credits.

Our view

GCOM gives a project in Saudi Arabia a credible home: a government-run registry, a familiar project cycle, and an additionality test at least as demanding as the international standards. For a landholder, a developer or a corporate considering a nature-based or industrial project in the Kingdom, the practical questions are the same as anywhere else: who holds the carbon rights, how the baseline will be set and defended, who will verify, and whether the credits are meant for domestic offsetting, the Riyadh exchange or an Article 6 transfer.

Karbuna is a carbon project development and management company based in the GCC. We develop and manage projects for their owners across the region, and we do not buy, sell or broker carbon credits.

This article is general information only. It is not legal, financial or investment advice.