Can I Sell Carbon Credits?
Sell Carbon Credits
The carbon market is a lucrative source of revenue for landowners, farmers, ranchers and other carbon sequestering entities. In the voluntary market, where companies buy carbon credits to offset their own emissions, the payouts can be quite high. The answer to the question “can i sell carbon credits?” depends on a number of factors including the type of project being undertaken and the minimum requirements set by the specific carbon marketplace.
Generally speaking, for every one metric ton of CO2 or equivalent greenhouse gases (GHG) that are reduced, avoided or removed from the atmosphere through verified projects, a credit is created. The credits, or Certified Emission Reductions (CERs), are then made available for purchase by individuals, businesses and other organizations looking to reach carbon neutrality or carbon neutrality. Once used, the credits are moved to a register for retired credits, and then no longer tradable.
Many types of projects generate carbon.credit, from reforestation to wind power to energy efficiency to biogas production. The projects are then registered with a carbon management organization, such as the American Carbon Registry, Verified Carbon Standard or Climate Action Reserve. These organizations have rigorous protocols and strict standards for projects to be eligible for registration. The projects are also validated by independent third parties to ensure that the GHG reductions claimed are real, and a verification report is issued for each CER.
Can I Sell Carbon Credits?
The goal of the carbon market is to encourage companies to reduce their emissions by providing a financial incentive through trading in emissions permits. This system is often referred to as a cap-and-trade program and is an alternative to strict government regulations that would force businesses to either reduce their emissions or pay into a fund for the purpose of reducing emissions. Proponents of the cap-and-trade system argue that it provides a flexible, market-based approach to regulating GHG emissions and allows for innovation in technologies that reduce carbon footprint.
While there are many benefits to carbon credit trading, the market is complicated and volatile due to the number of players involved. Typically, the buying and selling of carbon credits occurs through a broker. The broker takes the risk of acquiring the carbon credits from the seller and then marketing them to a buyer, taking a commission for their efforts. This type of transaction makes up a large percentage of the volume traded in the voluntary carbon market.
Another type of player in the carbon market is a standard, which is essentially an organization, usually an NGO, that sets quality criteria for the sale of carbon credits. These are referred to as core carbon principles and are intended to provide a framework for assessing the quality of a credit.
For those who wish to take an active role in the fight against global warming, the voluntary carbon market is a good place to start. For the average person, this market can be a way to generate some extra income and help the environment in addition to the local community.