![]() This year, the report noted the following developments: 3 The World Bank publishes yearly reports of the state of the carbon market. Since its inception back in 2002, the market has grown into a billion-dollar industry in the name of saving the planet. The market allows emitters to pay third parties to engage in emission reduction activities on their behalf in any part of the world. The Kyoto protocol, under article 17, provided the framework for setting up the current carbon trading marketplace. The following sections will look at the carbon marketplace in greater detail, to ensure sellers understand some of these terms used in the carbon market before selling their offsets. For instance, such a seller may not know whether the broker will sell the offset as a voluntary or a non-voluntary instrument. Another downside of this option is that the project proponent loses the chance to understand the working mechanism of the carbon market. In many cases, the brokers charge fees that may not be friendly to some. The traders will list the offset and find appropriate buyers on your behalf, but there’s a catch. Just like the stock market, carbon markets have brokers who can receive a quote from a buyer and find a corresponding offset in the market.Ĭontacting these brokers will open the carbon market to project proponents who may have little experience with carbon trading. Selling To BrokersĪ third option is to seek out brokers in the carbon trading market. Such collaboration is essential considering that, in some cases, carbon offsetting companies finance third parties to conceive and implement projects on their behalf, an opportunity you can exploit. Taking this route requires establishing some form of cooperation between carbon offsetting companies and project proponents. They, however, would probably be interested in additional offsets from outsiders to diversify their portfolios. Such companies have their projects which they sell in the carbon marketplace. Selling To Offsetting CompaniesĪ second option of selling carbon project offsets is contacting companies specializing in generating and selling offsets. Selling the offset will entail reaching out to such companies and selling them your methane reduction offset. Creating such projects is quite a task, and only a few companies may be interested. This practice is common for complex offsets such as methane reduction projects. For instance, DOEs can pitch their project to a specific company to sell it to them. Here, project proponents or the Designated Operational Entity will have to search for prospective buyers independently. The first option for selling a carbon offset project is to contact emitters who want to buy the offsets directly. There are three main ways to sell a carbon credit, depending on what you want to do with it and who you’d prefer to sell to. While the process of creating offsets is complex, selling them is much simpler. With approval, one can proceed to sell the project as an offset. ![]() Here, the CDM Executive Board reviews each project to confirm its emission reduction claims. Once the project proponent - also referred to as the Designated Operational Entity (DOE) in the case of a corporation - is confident that the project indeed offsets emissions, the next step is to follow the Clean Development Mechanism (CDM) procedures to validate the project. ![]() Thus, creating an offset starts by coming up with an emission reduction or avoidance activity. ![]() In simple terms, offsets offer a means of reducing historical emissions or avoiding future emissions.īy selling an offset, one is essentially requesting for finance to invest in an emission reduction activity. Generally, sellers of carbon offsets have three options to consider:īefore diving into each one of them, let’s review the process of creating a carbon offset that truly helps the environment… Creating a Carbon Credit or Offsetīefore selling carbon credits, one ought to understand the process of creating these offsets in the first place. That’s why it’s time to focus on the supply side of the carbon marketplace, to fill this information gap. Yet, both the demand and supply sides must work for the carbon market to deliver its emission reduction targets. While many are familiar with the demand side of the market, very few people pay attention to the supply side, with selling carbon credits. The carbon marketplace has grown tremendously since its inception after the Kyoto Protocol, a United Nations treaty that commits the participating countries to reducing greenhouse gas emissions. ![]()
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