Carbon credits are tradeable certificates representing greenhouse gas (GHG) emissions that have been reduced, avoided or removed through projects that are verified according to recognized quality standards.
Their purpose is to contribute to climate action and to help companies offset their hard-to-abate emissions.
carbon
credit
1 = 1
tonne of CO2e
reduced or removed
bn
tonnes of global CO2e emissions in 2023
+
%
increase vs. 1990
c.
mn
carbon credits retired in 2023
Energy Efficiency projects relate to the development of systems which require less or cleaner energy to perform tasks. The reduction of energy consumption and the substitution of fossil fuels with clean energy result in the reduction of greenhouse gas emissions. Examples include renewable energy projects (e.g. installation of wind turbines or solar panels), optimization of industrial processes or improved cookstoves.
Afforestation projects relate to the plantation of trees and the creation of forests on land that was not forested previously. Trees absorb carbon dioxide during photosynthesis, thus they remove greenhouse gas emissions from the atmosphere. These projects are different from REDD projects (Reducing Emissions from Deforestation and forest Degradation) which aim at the protection of existing forests that are in danger of extinction.
Methane gas projects relate to initiatives aiming at capturing, reducing, or preventing methane emissions from entering the atmosphere. Examples include landfill gas capture projects, manure management projects or the use of biodigesters.
Biofuel projects relate to the production and use of biofuels in replacement of fossil fuels. Biofuels, which derive from organic materials such as plants or waste, are generally considered carbon-neutral because the CO₂ emitted when used is roughly equal to the amount absorbed by the feedstock during its growth phase. Examples include ethanol (made from corn), biodiesel (made from cooking oil) or biogas (made from waste).
Biochar projects relate to the production of biochar, which is a charcoal-like substance that is made by burning biomass (i.e. organic material such as wood chips and leaves) via pyrolysis (i.e. heating in low oxygen conditions). By converting biomass into biochar, these projects lock away carbon dioxide that would otherwise be emitted from decomposed forest residues. Biochar can be applied in soil, where the carbon is sequestered for thousands of years.
Direct Air Capture (DAC) projects are initiatives that use advanced technologies to remove carbon dioxide directly from the atmosphere. Purpose-built facilities capture air from the atmosphere, then they use specialized filters or chemical solutions to extract CO₂, then they concentrate and purify CO₂ to be ready for transportation and storage and finally they store it in deep underground reservoirs for thousands of years.