Carbon credits, also known as carbon offsets, represent reductions or removals of carbon emissions, measured in metric tonnes of carbon dioxide equivalent (tCO2e). These credits can be generated by projects that absorb carbon from the atmosphere, such as reforestation, or by initiatives that decrease carbon emissions, like renewable energy projects. Carbon markets facilitate the buying, selling, and trading of these carbon credits. To guarantee that carbon credits effectively contribute to global climate goals, they must adhere to established principles of environmental integrity.

Benefits of Carbon Trading

• Carbon markets direct financial resources to support global emissions reduction or removal efforts that might not be feasible due to limited policy frameworks or economic incentives.
• By enabling cost-effective mitigation activities, carbon trading accelerates climate action and advances global climate targets, helping to achieve the goals outlined in the Paris Agreement.
• Beyond reducing emissions, carbon credits also offer numerous co-benefits to local communities hosting these projects. These benefits include sustainable development through the creation of green jobs, access to renewable energy, protection of the environment and biodiversity, and enhanced climate adaptation and resilience.