Carbon offset

The price for these carbon credits depends on the type of programs used, with two broad ways to price the carbon and determine the carbon offset. From an economic perspective, both programs work in equivalent ways—in one program, price for emissions is determined by setting a fee on emissions, and; in the other, the level of emissions is set. Both approaches promise to deliver on a reduction of emissions.

In some cases, a region will use hybrid approaches that include regulations to limit carbon emissions, but also set bounds on how much the price can vary. This approach can adjust the tax to ensure that specific emission reduction goals are met. And another hybrid approach could see an implementation on a cap-and-trade system for one sector, while another sector sees a carbon tax applied.

The process of offsetting emissions involves procuring carbon credits. For these credits to be credible, itthey must be:

These standards are offered through different verification schemes, with the four mainstream verification schemes including:

Offset claims are often considered defensible under a set of conditions, although organizations sometimes use other investments to make reduction claims, such as the purchase of "renewable energy credits.". Often these other instruments do not meet the criteria for effective carbon offset claims.

The price for these carbon credits dependdepends on the type of programs used, with two broad ways to price the carbon, and thereforedetermine the carbon offset. From an economic perspective, both programs work in equivalent ways, in thatways—in one program, setsprice for emissions is determined by setting a pricefee on emissions, whichand in turn determines the price for emissions, and the other sets, the level of emissions, which determines a price for thoseis emissionsset. Both approaches promise to deliver on a reduction of emissions.

The first such program is a cap-and-trade program where laws or regulations limit (or 'cap') carbon emissions from sectors of the economy, if not the entire economy. Each ton of carbon emitted is considered a single allowance, which can in turn be traded or sold among other market participants similar to the trading of securities on an exchange.

In some cases, a region will use hybrid approaches whichthat include regulations to limit carbon emissions but also set bounds on how much the price can vary. This approach can adjust the tax to ensure that specific emission reduction goals are met. And another hybrid approach could see an implementation on a cap-and-trade system for one sector, while another sector sees a carbon tax applied.

As well, when carbon offset is intended to occur, the main emission considered is carbon dioxide. The other mixture of gases known to cause damage to the atmosphere and environment, also known as greenhouse gases (GHG), andare also products of human activity, includeincluding methane, nitrous-oxide, hydrofluorocarbons, perfluorocarbons, nitrogen trifluoride, and sulfur hexafluoride. These GHGs include carbon dioxide, which is the most abundant, but the other gases can have similar or greater pollutant effects.

The process of offsetting emissions involves procuring carbon creditscarbon credits. For these credits to be credible, it must be:

A carbon offset is a credit for emissions reduction given to a party to compensate for emissions. Buying offsets helps individuals and organizations account for the environmental costs of their business processes. In many cases, dependent on some regulatory environments, carbon offsets do not have to be applied locally. As the effects of a carbon offset can be experienced globally (much in the way emissions are experienced globally), the offset can be applied locally or globally equally. As well, the effects can be the same if an organization ceases an emission-causing activity or if the organization enables an equivalent emission-reducing activity elsewhere. Carbon offsets and related programs are intended to make it easier and more cost-effective for organizations to pursue the latter option.

AThrough these schemes, each carbon offset is a credit for emissions reduction given to a party to compensate for emissions. Buying offsets helps individuals and organizations account for the environmental costs of their business processes. Through these schemes, each carbonor credit is equivalent to a carbon reduction of 1 ton of carbon dioxide. Carbon reduction projects can include:

A carbon offset is a credit for emissions reduction given to a party to compensate for emissions. Buying offsets helps individuals and organizations account for the environmental costs of their business processes. Through these schemes, each carbon credit is equivalent to a carbon reduction of 1 ton of carbon dioxide. Carbon reduction projects can include:

• Reforestation programs
• Avoided deforestation, or REDD (Reducing emissions from Deforestation and Forest Degradation)
• Enhancement and sustainable management of forestry
• Use of renewable energy sources
• Implementation of energy efficiency programs
• Capture of landfill gas or methane
• Clean cookstove projects
• Clean water access programs

The process of offsetting emissions involves procuring carbon credits. For these credits to be credible, it must be:

• Additional, in that the program ensures carbon reduction is real and permanent
• Verified, in that the credit program has proven assurance on its quality and credibility
• Traceable, such that the program is transparent and offers proof of the offset

These standards are offered through different verification schemes, with the four mainstream verification schemes including:

• Gold Standard
• Verified Carbon Standard (VCS)
• Plan Vivo
• UN Clean Development Mechanism

Offset claims are often considered defensible under a set of conditions, although organizations sometimes use other investments to make reduction claims, such as the purchase of "renewable energy credits". Often these other instruments do not meet the criteria for effective carbon offset claims.

The price for these carbon credits depend on the type of programs used, with two broad ways to price the carbon, and therefore the carbon offset. From an economic perspective both programs work in equivalent ways, in that one program sets a price on emissions which in turn determines the price for emissions, and the other sets the level of emissions, which determines a price for those emissions. Both approaches promise to deliver on a reduction of emissions.

The first such program is a cap-and-trade program where laws or regulations limit (or 'cap') carbon emissions from sectors of the economy, if not the entire economy. Each ton of carbon emitted is considered a single allowance, which can in turn be traded or sold among other market participants similar to the trading of securities on an exchange.

This second program uses laws or regulations to establish a fee per ton of carbon emissions from a sector if not from the whole of the economy. Emitters are subject to the tax based on their total emissions, which in turn incentivizes the reduction of emissions through a transition towards cleaner energy and more efficient energy use.

In some cases, a region will use hybrid approaches which include regulations to limit carbon emissions but also set bounds on how much the price can vary. This approach can adjust the tax to ensure specific emission reduction goals are met. And another hybrid approach could see an implementation on a cap-and-trade system for one sector, while another sector sees a carbon tax applied.

While these mechanisms are considered capable of establishing a price for carbon per ton, some consider the cost to be below the estimated cost of damage that each carbon pollution can cause on a global scale and in ocean acidification.

As well, when carbon offset is intended to occur, the main emission considered is carbon dioxide. The other mixture of gases known to cause damage to the atmosphere and environment, also known as greenhouse gases (GHG), and also products of human activity include methane, nitrous-oxide, hydrofluorocarbons, perfluorocarbons, nitrogen trifluoride, and sulfur hexafluoride. These GHGs include carbon dioxide, which is the most abundant, but the other gases can have similar or greater pollutant effects.