A Carbon Credit is a type of carbon offset that is a part of the international emission trading schemes... It offers one of the best ways to minimize the effects of greenhouse emissions on industrial scale. This is done by capping the entire annual emissions and allowing the market to allocate a monetary value through trading the shortfall. These Carbon Credits can be exchanged among different businesses and purchased or sold in the international markets at an existing market price. China and India are the biggest sellers; whereas Europe is the biggest buyers of Carbon Credits.
One Carbon Credit is equivalent to one ton of carbon dioxide gas (Co2) or its equivalent greenhouse gas. Different enterprises generate Carbon Credits in order to shift the world towards cleaner technologies and thus, save on energy consumption. This eventually minimizes the emissions of the greenhouse gas. For every ton of Co2 gas emission avoided, the individual will receive a carbon emission certificate. This certificate can be sold either immediately or through futures market by the entity similarly like any other commodity.
The theory of Carbon Credits came into subsistence as an outcome of growing awareness for the need to control emissions. Purchasing the Carbon Credits plays a vital role in reducing the emissions. They generate a marketplace to decrease the greenhouse emissions by offering economical value to the cost of air pollution. For example, a factory gives 100,000 tones of greenhouse emissions annually. This is illegal and so the factory gets a quotation of reducing its emissions by up to 80,000 in a year. So, there are two options for this factory it can either decrease its emissions or buy Carbon Credits to equalize for the excess. It will preferably purchase Carbon Credits in the open market form various organizations that have gained approval to sell legal Carbon Credits.
These certified Carbon Credits help the companies to get better ideas on carbon emission and ways of reducing it through certified Carbon Credits. This will encourage the companies ot purchase other products that are environment friendly and will help in energy conservation. Carbon Credits also help in the promotion of planting more trees throughout the world. This will give more access to oxygen as trees bring about the conversion of carbon dioxide to oxygen.
One Carbon Credit is equivalent to one ton of carbon dioxide gas (Co2) or its equivalent greenhouse gas. Different enterprises generate Carbon Credits in order to shift the world towards cleaner technologies and thus, save on energy consumption. This eventually minimizes the emissions of the greenhouse gas. For every ton of Co2 gas emission avoided, the individual will receive a carbon emission certificate. This certificate can be sold either immediately or through futures market by the entity similarly like any other commodity.
The theory of Carbon Credits came into subsistence as an outcome of growing awareness for the need to control emissions. Purchasing the Carbon Credits plays a vital role in reducing the emissions. They generate a marketplace to decrease the greenhouse emissions by offering economical value to the cost of air pollution. For example, a factory gives 100,000 tones of greenhouse emissions annually. This is illegal and so the factory gets a quotation of reducing its emissions by up to 80,000 in a year. So, there are two options for this factory it can either decrease its emissions or buy Carbon Credits to equalize for the excess. It will preferably purchase Carbon Credits in the open market form various organizations that have gained approval to sell legal Carbon Credits.
These certified Carbon Credits help the companies to get better ideas on carbon emission and ways of reducing it through certified Carbon Credits. This will encourage the companies ot purchase other products that are environment friendly and will help in energy conservation. Carbon Credits also help in the promotion of planting more trees throughout the world. This will give more access to oxygen as trees bring about the conversion of carbon dioxide to oxygen.