How It Works
Corporations have multiple ways to balance their carbon liability. They can reduce their carbon emissions (their "carbon footprint") through capital investment, projects and demand reduction. They can purchase emission permits, be allocated quotas (such as European Union Allowances (EUA)) or buy carbon credits. The latter are largely produced by CDM projects (Clean Development Mechanism) and Joint Initiatives. These credits are largely traded in form of Certified Emission Reduction (CER), or Emission Reduction Unit (ERU). Voluntary Emissions Reduction (VER) have a similar function but have not registered / cannot be registered under the rules of the Kyoto Protocol.
Read more about this topic: Weighted Average Cost Of Carbon
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“Through the din and desultoriness of noon, even in the most Oriental city, is seen the fresh and primitive and savage nature, in which Scythians and Ethiopians and Indians dwell. What is echo, what are light and shade, day and night, ocean and stars, earthquake and eclipse, there? The works of man are everywhere swallowed up in the immensity of nature. The AEgean Sea is but Lake Huron still to the Indian.”
—Henry David Thoreau (1817–1862)