Carbon Markets
The purpose of carbon markets is to encourage countries and companies to take responsibility for their carbon emissions, offsetting the impact of their activities. They are temporary instruments to help with the transition to a low-carbon economy.
How they work
In carbon markets, one carbon credit equals one tonne of CO2 equivalent sequestered or prevented from entering the atmosphere. An organization that has removed more greenhouse gases than its operations have emitted, for example, can sell its credits to another organization that has not yet reached its target, as long as the credits are analyzed by an independent entity or, in the case of compliance markets, comply with legal requirements. These transactions help to offset part of the planet’s carbon emissions, which can help slow global warming.
Types of carbon markets
Compliance
Compliance markets are established by government entities, which can be a country, a state or a region, such as the European Union. Their goal is to limit carbon emissions to maximum levels and enable sustainable alternatives for the development and creation of cleaner technologies. These markets distribute carbon allowances that give organizations the right to emit until the established limit is reached. These allowances can often be traded between companies.
Greenhouse gas emission reductions are considered business opportunities for sectors that are more efficient, and can be traded as carbon credits and entered into the UN Carbon Offset Platform. Compliance markets already exist in the European Union, for example, and in dozens of other jurisdictions.
Voluntary
Any company, person, NGO or government can generate or purchase voluntary carbon credits. These credits are audited by an independent entity and cannot be entered into the UN Carbon Offset Platform. For now, Brazil only has a voluntary carbon market. To learn more, visit the Sustainability Indicators page.
our carbon credits
As a company that plants eucalyptus trees, conserves native forests and restores degraded areas, we capture more carbon than we emit into the atmosphere. This allows us to develop projects that meet all methodological requirements to generate carbon credits, which can be traded with other parties.
Our Cerrado Carbon Project and Horizonte Carbon Project, in our Ribas do Rio Pardo site (to be inaugurated in 2024) and Três Lagoas site (in operation), in Mato Grosso do Sul, will contribute to this effort. Projects implemented in part of our land will generate carbon credits that qualify to be traded in the Brazilian voluntary carbon market. Watch the video to learn more.
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