We can think of carbon credits as the procedure of curbing greenhouse gas emissions through particular projects to credit the effect of gases emitted previously. Ideally, we credit emissions when it's hard to prevent them while executing our everyday activities. credits shouldn't be abused as a greenwashing step to emit greenhouse gases negligently without adopting a sustainable lifestyle.

Numerous nations have made nationwide rules that allow companies to emit up to a specific volume of emissions. Companies that can't keep their emission level within that preset limit must purchase credits to conform to the rules. While this compulsory necessity to sustain a low carbon footprint is the main driver of carbon trading, there is also a smaller voluntary market.

Trade Carbon Credits

People who are eco-friendly trade carbon credits to eliminate their own carbon footprint although they aren't obliged by law to do this. This voluntary acquisition, however, isn't restricted to individuals, and many large companies buy credits to retain a low footprint or to develop an environmentally friendly image.

Environmental Policies

To sum up, the demand for carbon credits is primarily driven by environmental policies on the official state level and secondarily by eco-friendly folks feeling guilt when they release greenhouse gases. Now how are carbon credits supplied?

Organizations that offer you credits generally acquire them from large projects executed to curb GHG emissions anywhere in the world. Genuine projects make certain that the aggregate emissions emitted on the planet get reduced so the exact location of these projects is not a big concern.

Greenhouse Gas

This is logical because greenhouse gases generated in one country influence the whole planet when they dissolve into thin air. So a project cutting pollution in Brazil can be effective in offsetting emissions produced in the United States. Because everything from labor to construction materials costs less in third-world nations, the final cost of generating one credit is considerably less as compared to western nations.

Final Words

There are many cases in favor of and against the practice of carbon credits but those are beyond the scope of this brief article. All in all, carbon credits have a say in the decrease of greenhouse gases if generated by genuine projects and sold with full transparency.