13 Feb 2020

Everything you need to know about carbon credits

Posted in: Carbon Credits

Everything you need to know about carbon credits

The emissions in our atmosphere continue to rise and the current trajectory of carbon reduction commitments across government and business will nowhere near meet the below 2 degrees target set by the Paris Agreement.

Carbon credits are necessarily part of the equation to take rapid action on climate change and help us reach a net zero target by 2050.

So, what are the basics you need to know about carbon credits?

Word cloud of carbon credit terms like greenhouse, market, price, Offset, Trading etc

Carbon Credits 101

A carbon credit is a financial instrument to represent 1 tonne of carbon dioxide. Carbon credits are produced when a project stores, avoids or reduces greenhouse gases (carbon) emissions into the atmosphere. The purchase of the credit finances to the project itself.

Of course, it’s a little more than that but we’ve rounded up the five basic facts in Carbon Credits 101.

Carbon Credits - High vs low quality

How do you choose one carbon credit over another? It’s important to know how to choose quality – especially if you’re wanting to ensure your actions are meaningful and credible. There are a number of important points to consider when choosing:

  • what standard has been used?
  • what are the guiding principles used?
  • are there specific risks with the project to consider?

Don’t worry, we’ve laid it all out for you in Carbon Credits – High vs Low Quality.

The carbon credits market

Carbon credits are bought and sold in a market – just like a financial market. There are suppliers, buyers, a trading exchange and a registry. To add a layer of complexity, there are compliance and voluntary markets to distinguish between. Also, the demand is rising – making prices and availability more volatile.

The market intel you need to know is in Carbon Credits – 3 Market Fast Facts.

Got more questions? Get in touch.

If you’re starting on the journey and want to know more, or are mired in carbon credit decisions, speak to our experts and make informed choices.

At Toitū Envirocare, we’ve done the hard work of fact checking for you, so you can have confidence in the carbon credits that we source for the Toitū carbonzero and Toitū carbonreduce certification programmes.