Your Kids Will Be Glad You Did
The term Carbon Credit or Carbon Offset Credit represents a tradable certificate that details a person, family or corporations support of the environment. We all contribute CO2 in some fashion by driving, riding the bus, flying or buying goods and services manufactured by companies that emit CO2 in the production process.
A carbon credit represents someone’s commitment to the environment and their investment in a green project here in the US or abroad. The Carbon Free Zone is one of the most fierce champions for clean air and water, by supporting projects designed to restore what we have taken from the planet, without regard to the fine balance that must exist between progress and protection.
There are two basic types of carbon credits. These include:
How the carbon credits work is this. The purchaser of a carbon credit certificate or permit has the right to emit 1-ton of carbon dioxide or some other recognized greenhouse gas. Some companies have worked hard to reduce their emissions and then use carbon credits to offset what they can’t.
These valuable credit are traded in units of 1 ton of CO2 and have the potential to become more valuable over time as more people take responsibility for their own emissions of CO2 and take action to be part of the solution
Carbon offset projects include the following:
Carbon offset work like this. Companies that reduce the amount of carbon already in the atmosphere have the ability to issue carbon offsets. The reduction can be done by planting more trees or investing in renewable energy. The purchase of offsets is voluntary and is known as the voluntary carbon market.
There are two markets to choose from for carbon credits which are regulated and volunteer credit. The regulation is set by state and local regulations. In this market, there are fines and extra taxes that can be given for going over the carbon credits that you purchased.
The volunteer market is where buyers and purchasers buy credits to offset their emissions. This is done voluntarily and has no mandates of fines or extra taxes.
There are many businesses that can produce and sell carbon credits. They do this by lowering, catching, and storing emissions through different procedures. These include:
Renewable energy is nothing new. It has been around for a long time. Long before carbon credits were ever thought of and brought into the market. There are many countries that have plenty of renewable energy. For example, Brazil or Canada has many lakes and rivers, or nations like Denmark and Germany with lots of windy regions. These countries because they already had abundant renewable energy and are now providing the benefit of carbon offset creation.
Energy efficiency improvements supplement renewable energy projects. This is done by, allowing companies to reduce the energy demands of current buildings and infrastructure. Simple steps such as changing from incandescent bulbs to LED bulbs in your building or home can help the environment because they lower power consumption. For bigger buildings such as factories, multistory building such as housing, and others can be renovated to include renewable energy or optimizing industrial processes.
Carbon and methane capture requires implementing practices that remove CO2 and methane from the atmosphere. With methane, it can simply be burnt off to create CO2. Carbon on the other hand the capture happens at the source like chemical and power plants. The captured has been used for decades and is injected underground for numerous reasons like improved oil recovery.
This is nature’s way of cleaning the air. The trees, shrubs, grass, and every living plant on the planet uses the carbon from the atmosphere. It is food for them to grow and live. In return they give oxygen back to the atmosphere. As plants die they return to the soil as organic matter which in turn enriches the soil for new plants such as trees or food for humans and animals.
Another use of carbon credits that is an advantage to farmers is that it can be another source of income. Income on top of their crops and livestock can help them grow.
How this works is the farm uses regenerative agriculture practices to reduce their dependence on costly and environmentally toxic pesticides. The farmer can sell the carbon credits to companies like Shopify, Barclays, JP Morgan Chase, and IBM. The farmer for example gets $10.00 per carbon credit. That is extra income beyond his crops or livestock. By using regenerative agricultural practices, the farmer also spends less on utilities and fuel for their machinery. That along with the money for the carbon credits they sell can add up.
However, not all opportunities are equal. Flaws can easily be seen or brought forth even with extremely monitored programs such as California’s. Theoretically, carbon offset purchases gives companies a concrete way to reduce their carbon footprint. When used correctly carbon offsets allow companies to earn extra PR credit and achieve a more measurable reduction in carbon emissions.
As you can see, there are benefits to carbon credits and carbon offset for the environment and those who create carbon credits.
If you are farm or commercial industry with carbon benefit, or if you install one of our Solar or Digester Systems, we may be able to sell your carbon credits to other companies or on the carbon exchange. Call for more info.
We understand the changing needs of our public and privately held clients in the capital markets. We will not only engineer your system but also work with your CFO and treasury department to finance the build-out.
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