Carbon Credits - How it works and what it is.

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Carbon credits are an economic instrument contemplated in the Kyoto Protocol. Each credit is equivalent to one ton of carbon dioxide that has been stopped emitting into the atmosphere.

How Carbon Credits Work

They can only be generated by the mechanisms established in the Kyoto Protocol. According to which mechanism, different types of credits are distinguished:

1. ERU, Emissions Reduction Unit (JI) or URE: emission reduction unit (AC). Amount equivalent to one ton of CO2 that is no longer emitted into the atmosphere by the launch of a joint application project.
2. CER, Certified Emission Reduction (CDM) or RCE: certified emission reduction (CDM). It represents one ton of CO2 that is no longer emitted into the atmosphere and that has been generated and certified through the clean development mechanism scheme.
3. RMU, Removal Unit (Afforestation & Forestation) or UDA: absorption unit (afforestation and reforestation). Quota available to achieve the elimination of greenhouse gases through the use of carbon sinks.

Of course, it is also true that some think that it is to give money so that they are allowed to continue polluting. In addition, they are credits that are bought and sold in international markets. In other words, they can be subject to speculation and they do not have to be used to protect the environment. As is often the case with any aspect that touches the world economy, it will meet the objectives that were set in its creation only if the plan is put to good use.

Conclusions.

In other words, these credits are used to make it easier to calculate the amount of gases that are released into the air and to compensate for their emission. It is part of an international plan, surely the largest that has been created in the entire history of mankind, in an effort to reduce global warming and its effects. It is about leveling the amount of total emissions that can be released by a company or business. If there is a surplus in the amount of gases that are emitted, there is a monetary value assigned to that surplus and it can be traded, mainly for projects that offset pollution, that is, that renew the dioxide that has been emitted into the atmosphere. , such as reforestation projects (usually in poor or developing countries).

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