How carbon crediting works

Carbon credits can be used to achieve carbon neutrality by balancing GHG emissions with their reduction/ removal. Ultimately, carbon removal credits can enable a state of net-zero emissions if they are used to neutralize unabatable emissions after deep decarbonization has been implemented.

Despite technological innovation, the current conditions do not allow total emissions reduction and the achievement of zero targets.

To overcome this barrier and act immediately, organizations can invest in GHG reduction/removal projects outside their supply chain and get carbon credits out of those to compensate for their unavoidable emissions.

This is also referred to as the carbon offsetting mechanism (or carbon compensation).

01

An organization wants to offset GHG emissions that could not be reduced directly.

02

The organization contributes economically to a project to reduce emissions that generate carbon credits.

Carbon credits projects may include

  • Reforestation
  • Renewable energy
  • Methane capture/combustion

03

The organization receives carbon credits for its contribution to the emission reduction project.

High-integrity projects

The carbon market offers a wide range of carbon credit projects all over the World. Choosing the right project to compensate emissions can become a difficult exercise.

ClimatePal is committed to certifying only reliable projects to generate high-integrity carbon credits. We align our System with the Umbrella Body requirement for offsetting standards to comply with Core Carbon Principles.

Goal and Approach: Reduce, Offset and Neutralize

Offsetting represents an immediate instrument to achieve the Paris Agreement goals – offsetting, however, cannot replace the necessary reduction of one’s own emissions. Companies should follow  “reduction – compensation – neutralization” approach to achieve Net Zero target.

This approach implies the implementation of reduction measure and the compensation of unavoidable emissions. The latter will proportionally decrease, with the increase in GHG emission reduction overtime. In the last step, emissions are neutralized through carbon removals by carbon sinks.

Reduce

  • Plan a trajectory to reduce emissions
  • Set targets consistant with a 1.5°C 
  • Migitation pathway
  • Implement reductions

Compensate

For the unavoidable emissions, become climate neutral by financing projects that further avoid and remove emissions.

Neutralize

Eventually eradicate unavoidable residual emissions with carbon removals to achieve net zero.

Reduction itself is not enough

Reducing GHG emission is not enough to combat climate change and achieve global goal of neutrality. To clean atmosphere, the excess of CO₂ must be removed. We specifically focus on carbon removal offsetting projects, as a promising approach for the achievement of Paris Agreement goals.