What is a Carbon Credit?

How do we define a "carbon credit"? What is the basis of its value? Watch the video below to learn more. 

What we covered: 

Carbon Credit: one metric ton of CO2 that was either not emitted, removed from the atmosphere, or captured at its source. These credits put a dollar value to activities that reduce or remove emissions so that we can trade them like more traditional, tangible goods.

• Expressed in units of “tCO2e”. T = tons, e = equivalents.

• The “equivalent” means we have to standardize other greenhouse gasses by their warming impact relative to CO2, which we often use as the standard reference point for emissions. You can see how different greenhouse gas emissions relate to each other at the EPA’s greenhouse gas equivalence calculator here.

• Companies tend to purchase carbon credits to reduce their carbon footprints: the total impact their emissions have on the atmosphere and environment. You can calculate your own personal carbon footprint here.

Many types of activities can generate carbon credits - we’ll explore this topic in depth in the next few videos. A few examples of potential credit-eligible projects:

• Introducing improved forest management (read more here)

• Implementing rotational grazing (read more here)

• Reducing nitrogen fertilizer application (read more here)

• Introducing seaweed into cattle’s feedstock (read more here)