A Carbon Credit is equal to one ton of carbon dioxide expelled in the atmosphere. The concept came into existence as a result of increasing awareness on the need for pollution control. It became formal after the agreement among 141 nations known as KYOTO PROTOCOL. Carbon Credits are the certificates awarded to the countries taking active participation in reducing the emissions that cause global warming.

As per the KYOTO PROTOCOL, developing as well as the least developed countries are not bound by the emissions they produce. For the developed nation, to meet the assigned reduction targets, allowances have been issued equal to the number of emissions allowed.

Carbon has become a liquid and investable asset class that now trades approximately US$1 billion per day across physical carbon, futures, and options. Carbon has exhibited attractive historical returns and a low correlation with other asset classes, making it potentially attractive within a diversified portfolio.

2021 will probably be remembered as the year when carbon finance emerged as a talking point among a wide range of industries.

Among the 2021 new entrants in voluntary carbon markets, oil and gas majors, hedge funds and banks were heard as the most active players, resolutely taking positions in the market. But as the year unfolded, many other sectors of the economy joined the market following their pledges to reduce carbon footprints. Voluntary carbon markets allow carbon emitters to offset their unavoidable emissions by purchasing carbon credits emitted by projects targeted at removing or reducing GHG from the atmosphere.

Each credit – which corresponds to one metric ton of reduced, avoided or removed CO2 or equivalent GHG can be used by a company or an individual to compensate for the emission of one ton of CO2 or equivalent gases. When a credit is used for this purpose, it becomes an offset. It is moved to a register for retired credits, or retirements, and it is no longer tradable.

Companies can participate in the voluntary carbon market either individually or as part of an industry-wide scheme, such as the Carbon Offsetting and Reduction Scheme for International Aviation, which was set up by the aviation sector to offset its greenhouse gas emissions. International airline operators taking part in CORSIA have pledged to offset all the CO2 emissions they produce above a baseline 2019 level.

Voluntary carbon markets are one mechanism to help companies manage currently unavoidable and residual carbon emissions in parallel to their own direct decarburization strategies.

Our Sales & Trading team trades Gold Standard, Verified Carbon Standard and United Nations CDM credits, including VERs, CERs, VCUs, EUAs and EUAAs. Our other services include Carbon Footprint, Carbon Offsetting, Carbon Neutral and Carbon Project Development. ​