Carbon Credits

The carbon credits niche refers to the market for buying and selling carbon credits, which are a type of financial instrument that represents a reduction of one metric ton of carbon dioxide equivalent (CO2e) emissions. The structure of this market can vary depending on the specific context, but there are some general patterns that can be identified.

There are regulated exchanges, namely the global Voluntary Carbon Markets as well as the geographically defined Compliance Carbon Markets. Trading can take place outside the exchanges as well, where buyers buy voluntary carbon credits to offset their CO2 directly from sellers. An example of this is the Voluntary Carbon Unit (VCU), a carbon offset credit specifically verified to the Voluntary Carbon Standard, one of the leading independent standards established to demonstrate integrity in project-based emission reductions in the unregulated voluntary carbon market. 

There are several names that are commonly used in the industry for carbon credits. Some of them include:

  1. Carbon offsets
  2. Emission reduction credits (ERCs)
  3. Verified emissions reductions (VERs)
  4. Certified emission reductions (CERs)
  5. Renewable energy certificates (RECs)
  6. Carbon allowances
  7. Carbon units
  8. Carbon certificates
  9. Carbon offsets and reduction schemes for international aviation (CORSIA) units
  10. Greenhouse gas (GHG) credits

If you are looking to connect to the carbon credits niche, there are a number of online platforms that facilitate the buying and selling of carbon credits, such as Carbon Trade Exchange or the Markit Environmental Registry. Additionally, there are a number of organizations and industry groups that provide information and resources related to carbon credits, such as the Carbon Pricing Leadership Coalition or the International Emissions Trading Association.

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