Carbon credits represent a reduction or removal of greenhouse gases from the atmosphere.

What is a carbon market?

• Carbon markets are systems where carbon credits are traded.
• There are two main types of carbon markets: compliance and voluntary.
• Carbon markets can help bridge the emission gap by mobilizing new resources for emission reductions and sustainable development.

What do you need to know about carbon credits?

• Governments, companies, and even individuals can buy carbon credits to offset their emissions.
• A single credit equals one ton of carbon dioxide emitted or the mass equivalent to carbon dioxide for other gases.

Climate conventions/mechanisms that focus on carbon credits

• Kyoto Protocol
• Clean Development Mechanism- Certified Emission Reduction (CER) carbon credits.
• The Paris Climate Agreement- Paris Agreement Crediting Mechanism (PACM).
• Glasgow COP26

 Why carbon credit is important

• Helps to reduce Greenhouse gas emissions.
• Encourage corporate responsibility.
• Will create cooperation between countries.
• Will create a mechanism for funding green technology.

Source: The Hindu