Carbon Credits Trading: New Business

by Heather Adams

in Environment

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Climate change issue is currently one of the important international agenda as global warming has become everybody’s concern nowadays. Participation to overcome this issue seems encouraging from all eligible sectors as partaking in sustainable, cleaner and greener scheme, corporate entities not solely derive additional revenue, but also exercise good corporate responsibility in sharing the world effort to mitigate climate change issue.

Carbon credits and carbon markets are as the elements of national and international makes an attempt to mitigate the expansion in concentrations of greenhouse gases (GHGs). One carbon credit is equal to at least one metric tonne of carbon dioxide, or in some markets, carbon dioxide equivalent gases.

Carbon trading is an application of an emissions trading approach. Greenhouse gas emissions are capped and then markets are used to allocate the emissions among the group of regulated sources. The goal is to allow market mechanisms to drive industrial and commercial processes in the direction of low emissions or less carbon intensive approaches than those used when there is no cost to emitting carbon dioxide and different GHGs into the atmosphere. Since GHG mitigation comes generate credits, this approach will be used to finance carbon reduction schemes between trading partners and around the globe.

There are many firms that sell carbon credits to business and individual customers who are inquisitive about lowering their carbon footprint on a voluntary basis.

World carbon credit trading could grow to US$1 trillion in an exceedingly decade as to date, the only largest bilateral and unilateral carbon market exists in Asia, with China and India leading the queue. Indonesia and Malaysia are emerging significantly within the oil palm, cement, bio gas and bio fuel sectors.

Carbon markets will play a vital role in directing investment to support the achievement of long-term greenhouse gas (GHG) emissions goals. The effective design and use of market mechanisms to support GHG emissions reductions guarantee that emissions abatement activities space achieved in the most value-effective manner.

The CDM, the main feature of the Kyoto Protocol, to be relied upon as an effective market-based mostly mechanism, is perceived as a golden chance by all developed and developing countries. It’s an instrument for combating climate change, allowing emission-reduction comes in developing countries to earn certified emission reduction (CER) credits. Each CER is equivalent to one tonne of carbon dioxide.

CERs can be sold privately (voluntary primary market) or traded internationally in the secondary carbon emissions markets at the prevailing market worth.

Project sorts embrace biomass energy from palm oil waste; biogas flaring and generation of biogas power, energy efficiency, landfills and wastewater treatment, composting of solid biomass waste from the palm oil mill, hydroelectricity generation from river & biomass-based mostly cogeneration of power.

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