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    Offsets and Removal

    What is Carbon Credits?

    Tradeable certificates representing the right to emit one tonne of carbon dioxide or equivalent greenhouse gas. Carbon credits can be traded on voluntary or compliance markets and are used to meet emission reduction obligations.

    Why it matters

    The voluntary carbon market is growing rapidly, but quality varies widely between projects. Businesses purchasing credits need to verify additionality, permanence, and third-party certification to avoid greenwashing accusations.

    Example

    A fintech startup allocates 1% of revenue to purchasing Gold Standard carbon credits from a cookstove project in East Africa, retiring 50 credits annually against its residual Scope 3 emissions.

    Related terms

    Carbon Offsets

    Credits purchased to compensate for emissions by funding projects that reduce, avoid, or remove greenhouse gases elsewhere. Examples include reforestation, renewable energy projects, and methane capture. One offset typically equals one tonne of CO₂e.

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