Abiotic Natural Resources


The different forms of abiotic natural resources are listed below.
  • Gold
  • Coal
  • Diamond
  • Silver
  • Bauxite
  • Nickel
  • Copper
  • Iron Ore
  • Zinc
  • Lead
  • Sulfur
  • Chromite
  • Talc
  • Barites
  • Marble
  • Limestone
  • Platinum
  • Vanadium
  • Salt
  • Sand
  • Gravel

Carbon Credits Explained

Do you know that the carbon credit market is worth a couple of billions! Information about carbon credits explained further helps you to know more about this popular term in the financial market...

Increasing levels of carbon dioxide gas in the atmosphere has raised world wide concerns regarding global warming. In the international carbon trading market, control on the rate of emission of carbon dioxide has become a hotly debated topic. Carbon credits explained by scholars in carbon market is defined as a generic term that can be referred to any legal document or certifications that restricts emission of CO2 into the atmosphere. Governments and large corporations buy carbon credits as it is their moral responsibility to reduce emissions of carbon dioxide. Still wondering what are carbon credits? Read further...

What Are Carbon Credits?

Mathematically, one carbon credit is awarded to an organization for preventing the emission of one metric ton of carbon dioxide into the atmosphere. It is called a CO2e (CO2 equivalent). In the year 1990, the world's major polluters were identified by a study based on CO2 emissions. Based on common census, nearly 37 countries signed the Kyoto Protocol in December 1997, in a world summit in Japan. It however, came into force on February 16, 2005 after Russia also ratified it. The long hiatus between the signing and execution of Kyoto protocol was due to the fact that at least 55 countries were required to sign it, before it must come into existence. Moreover, the global production of these 55 parties must be at least 55% of total global green house gas production.

The participating countries that ratified Kyoto protocol have pledged not only to reduce emissions of CO2 but also of four other green house gases; methane (CH4), Nitrous Oxide (N2)O, Hydrofluorocarbons (HFCs), Perfluorocarbons (PFCs) and Sulfur Hexafluoride (SF6). If the countries that have ratified Kyoto protocol go above their target emissions, they have to buy "credits" from other countries that have been able to cut their greenhouse gas emissions, significantly.

The Kyoto protocol was introduced under the chapter of United Nations Framework Convention on Climate Change (UNFCCC or FCCC). As per the Kyoto protocol industrialized countries have promised to lower CO2 emissions by 5% by 2008 -2012. So are you getting what are carbon credits? More information about carbon credits explained further will help you to understand this environmental economics term in a more enlightened way.

Buying and Selling Carbon Credits

Trading carbon credits is quite a common financial bargain for various countries. A country is given carbon credit for every metric ton of carbon dioxide that it doesn't allow to go into the atmosphere. This can done through many processes like hydro power projects that replace coal fueled plants or by planting trees and starting afforestation projects.

To get your queries regarding carbon trading explained, we will help you with another example. Consider for instance, there is a steel company in a developing country that is using eco - friendly methods in its factories like wind energy generation power plants to boost its production. The steel company emission quota is 12 tons. However, if it expecting to release 14 tons of carbon dioxide, it can buy 2 credits from the wind generation power plants. Credits are awarded to developed countries that have been able to cut back on their emissions. Developing countries can buy credits from developed countries in case, they exceed their emission targets.

In the last segment regarding carbon credits explained, we wish to inform you that in practice, the aim of the Kyoto Protocol has been very noble. However, owing to its amazingly complex trading system, carbon credit trading has suffered flaws and lack of transparency. It is said that various large corporations put in extra money to grab carbon credits, instead of seriously trying to reduce their carbon footprints. Understanding carbon trading is certainly not an easy task especially now, when it has been almost a decade, wherein it has failed to a large extent.

Carbon Credits Price

The carbon credit market is rising exponentially every year given the global warming awareness. To know more about carbon credits price, read on.

Is carbon credit the new global currency? All the drawbacks and problems related to currencies like Dollars or Euros are taken care by the Certified Emission Reduction (CER) credits. It can be traded all over the world. And it is used by all the major countries more or less in similar proportion. Its unit one metric ton of carbon is universal and doesn't change from country-to-country. Moreover, its relevance is understood all over the world. Even if the question is hypothetical (or real?), one thing is for sure - carbon credits have assumed a significance we didn't think of some ten years before, and it has caused a visible rift between the industrialized and developing world. Even if the 'diplomatic' sources don't allow the differences to boil over, this one issue has polarized the world after the democracy-communism ideology cold war. With all this interesting background, let us understand what are carbon credits, in the real sense.

Carbon Credit

Contrary to the above picture, the concept of carbon credit is very beneficial and easy to understand. This concept was brought to help reduce carbon dioxide, the biggest contributor to greenhouse gases leading to global warming. A carbon footprint is measured of each company or individual or country using various carbon calculators, or a central authority is assigned for this purpose. As per the calculations, a certain number of credits are assigned to each company for a certain period of time. If the company is successful in controlling its carbon emissions under the assigned credit value, it is permitted to sell those credits in the carbon market for monetary gain. On the other hand, those companies or countries who fail to control their emissions under the required limit, need to purchase these carbon credits as a offset for the extra carbon they emitted. In a nutshell, having one carbon credit permits the holder to emit one ton of carbon dioxide.

Under the Kyoto Protocol, there are three carbon credits exchange mechanisms - Joint implementation, Clean Development Mechanism (CDM) and International Emissions Trading (IET). These mechanisms allow the developed countries or companies with high carbon footprint to acquire carbon credits, but all differ according to the clauses of buying and selling the carbon credits. These mechanisms aim at achieving carbon neutrality, which means there should be net zero carbon footprint.

Carbon Credits Price

One carbon credit (or carbon 'offset') is a closely regulated certificate representing a reduction of one metric ton of carbon dioxide being released into the atmosphere. In dollar terms, carbon credits price per ton is about $15 to $40. This cost of carbon credits fluctuate on a large scale over the continents and over small time periods, and hence, is one of the dangers of the climate change policy. That means, even though the unit 'one ton of carbon dioxide' remains unchanged, the Dollar and Euro equivalent values may not be similar. Also, the variation in the demand and supply of carbon offsetting in various countries keeps the carbon credit price unstable. Many times, it is left to the individual buyers and sellers to negotiate and determine the current price of carbon credits. The lack of information on the appropriate prices leaves the buyers and sellers in a dilemma about the timing and expectation of optimum price. But one good thing carbon pricing has done is that it has helped the common people to understand which products induce carbon emissions, and hence should be used sparingly, and it also provides incentives for the investors and innovators to produce and invest only in low carbon products, thus benefiting them financially.

Many individuals are taking up this issue as a moral duty and are calculating their carbon footprints to understand and buy the required carbon credits. This trend is gradually rising, but what is needed is global awareness! Until and unless all the developed countries take up this issue seriously and proper international laws are made, carbon credit concept will not help in minimizing the emissions on a large extent. Accepted that many international organizations are working towards the carbon neutrality goal, but stringent punitive laws will go a long way in ensuring that global warming is dealt with.

The heavily anticipated (before its start) Copenhagen Climate Change Conference in 2009 fell flat on its face. Then the Cancun Conference last year zoomed past without any significant achievement. An expected progress meant for taking the world beyond Kyoto Protocol didn't materialize, and frankly, is nowhere in sight. The whole world is waiting for the responsible countries to stand up and take action. A catastrophe is waiting to happen alongside. If the global warming issue is not taken care of within a short period of time, all the carbon credits price and buy-sell brouhaha will amount to nothing, and we may be staring at a bleak future. I imagined to end this article optimistically, but I cannot help in being cynical about the whole issue.

How to Buy Carbon Credits

Carbon Credits

Carbon credits help you to offset the carbon dioxide emission you cause. This article explains how to buy carbon credits to help deal with the larger problem of climate change. Read on to know more.

Climate change is a catastrophe-in-waiting. Global warming is just the start of the major after-effects. All the changes in the atmosphere, be it hotter or cooler temperatures, the increase in sea levels, melting of glaciers or the more-than-frequent hurricanes, are all, primarily, a result of the increased carbon-dioxide levels in the atmosphere. And you, me and every person on this planet is responsible for this. It is not that we have a choice! That is the grim part. Everything we use nowadays is an industry-made product. Even if you drive a car for ten minutes per day, you contribute to the increase of carbon dioxide.

Now, we cannot change our lifestyles all of a sudden to minimize the damage we are causing to nature. But what we can do is, we can make sure that the carbon dioxide we emit in the atmosphere is offset somewhere else, so that we can at least get rid of the guilt-factor and help effect a change, however small it can be. This change can be brought about by buying carbon credits. In this article, we will see in detail how to buy carbon credits, and how it helps in the larger cause.

Carbon Credits

Carbon credits are, basically, offsets which you purchase to achieve carbon neutrality. It means you save the same amount of carbon from being emitted somewhere else, which you have directly or indirectly emitted. They are measured in terms of per ton of carbon dioxide emitted. Carbon credits price varies from $15 to $40 per ton based upon the variation in the demand and supply of the carbon credits. This price is volatile, given the global exchange of carbon credits and the currency dynamics involved. If you are based in the USA, carbon offsetting for you can be done through any solar power project based in the Middle East or forestation done in Australia. Carbon credits have added a new dimension to our everyday lives, helping us to understand which products should be used and avoided, given the amount of carbon emission they cause.

How to Buy Carbon Credits

The average carbon footprint (amount of carbon you emit) of an American is around 19 to 20 tons of carbon dioxide per year. But since this is an average value, you should calculate your carbon footprint before buying carbon credits. There are many websites, which can help you to calculate your carbon footprint simply by asking you the daily miles you travel by your car, quantity of fuel you use, your electricity and gas usage, your airplane travel and so on. After this calculation, you can buy carbon credits online to offset your carbon emission. Many carbon credit providers like Carbonfund, The Climate Trust, TerraPass sell carbon credits online, and you can see their comparisons on websites like Carbon Catalog and EcoBusinessLinks, so as to decide where you need to buy it, so that your purchase has an effective designated impact. You can simply buy the carbon credits using your credit card or PayPal.

The money collected from you is allocated to various projects supported by the provider like solar power, geothermal power, wind power projects, as also for biomass combustion and forestation. Large businesses, who have a very high percentage of carbon emissions, can decide how their carbon credits are used. It means they can have a say on which kind of carbon saving project their funds will support. Individuals do not have such a choice, but they can certainly check the authenticity of the project from the carbon credits' provider.

You need to check whether these projects are certified according to industry standards and verified by third parties. Some of these standards include the UN Clean Development Mechanism, Environmental Resources Trust, Voluntary Carbon Standard, Green-e Climate and California Climate Action Registry. Also check whether your offset provider is open about its management and ethos. Ensure the provider explains the money spent on various projects by getting his portfolio audited on a regular basis. A financial audit ensures the designated usage of your money. As I said above, the carbon credit pricing can vary a great deal due to differential project costs and administrative overheads. Check if the pricing is justified through comparison with other credit providers.

Knowing how to buy carbon credits is not that difficult, although you need to ensure how your money is allocated to different projects and check their authenticity. Our simple step of buying carbon credits and helping lower carbon emissions can be a stepping stone for the change we can bring about. Your example can trigger and convince other people around you to do the same. We have a responsibility towards nature, and particularly towards the air we breathe in. So go ahead, calculate your carbon footprint and buy those carbon credits, to bring about a positive difference in the world we inhabit!

Selling Carbon Credits

Selling Carbon Credits

This article explains the mechanism of buying and selling carbon credits, to help you understand in detail about the critical issues of carbon emissions and the rising importance of the carbon credits market. Have a look...
Our climate is changing. The Earth's climate has, in fact, warmed by 1.1 to 1.6 degrees Fahrenheit since the industrial revolution. People look at this and say: Oh, that is not very much. In fact, it is very much, and it changes the dynamic. It impacts species. It kills some. It diminishes the carbon sink of the ocean. It does a number of things. ~ Diane Feinstein

Feinstein's views point to a larger picture, which are a result of an amalgam of smaller everyday things we use to emit carbon in the atmosphere. The average carbon emission of an American is about 19 to 20 tons of carbon dioxide, which is much larger compared to other countries. The rise of carbon dioxide levels in the atmosphere have prompted many serious complications to occur in the entire world. So, it has become imperative to minimize the emission levels. The introduction of the emissions trading system over the years has not just become a powerful policy instrument on the international diplomatic platform, but also helps us to reduce these emissions. Clarity, compliance, efficiency and price signal are the main pillars on which the emissions system stand. Carbon credits are the currency-equivalent in carbon trading. Let us see what is the meaning of carbon credits and the mechanism of selling carbon credits, in detail.

Carbon Credits

The unit of carbon credit is one metric ton of carbon dioxide. It is primarily used as an offset to achieve carbon neutrality. For instance, consider that you have a business, which has a very low percentage of carbon emissions as compared to other similar businesses. What you can do is, you can help the other business to offset their carbon emission by selling them the carbon credits. Suppose you sell 5 carbon credits to that business, it means that you are helping them to offset their 5 tons of extra carbon emission. The carbon credits price fluctuates, given the market dynamics of demand and supply, globally varying pricing and currency structure, etc. One carbon credit costs around $15 to $40. Now, let us understand who can sell carbon credits.

How to Buy and Sell Carbon Credits

Buying Carbon Credits
Nowadays, it has become an extremely easy process, given the number of carbon credit providers like Carbonfund, The Climate Trust, and TerraPass, selling carbon credits online. These providers sell you the carbon credits and use the money generated thereby to allocate to various projects supported by the provider, like solar power, geothermal power, wind power projects, biomass combustion, forestation, etc. You are just required to calculate your carbon footprint (the amount of carbon you emit) through simple calculations provided on the same website using the data like your electricity or fuel usage. Then, you will have to buy the carbon credits using your credit card or PayPal, to help offset the carbon you emit.

Selling Carbon Credits
First, you need to determine whether your business can help in offsetting the carbon emission of other businesses. You need to have very low carbon emissions for the same output produced in comparison to others. Then you have to approach the Chicago Climate Exchange (CCX) to get the membership to be eligible for selling carbon credits. This carbon exchange functions similar to a normal stock exchange, where according to the market fluctuations, carbon credits can be bought and sold. Your business is audited and monitored after a certain interval of time to check for the authenticity of your claim of carbon offsetting, to the number of carbon credits you offer for purchase on the carbon stock exchange. There is a CCX electronic trading platform through which the trades are conducted. You can trade your carbon credits with other businesses through CCX. It is advised that you trade the credits with large companies, so that you can get a good price.

Now, many of you may be wondering, "Can I sell carbon credits?" The answer is yes, if you are a farmer or a large land-holder. The government has an agricultural carbon credit scheme to help you in this regard. The cropland must be farmed with no-till or conservation tillage practices to qualify for carbon credits, as not tilling up the land each season means the carbon dioxide in the soil is not released into the atmosphere. Also, according to recent news, under a draft legislation for the government's carbon farming initiative (CFI), farmers, forest growers and land-holders will be able to earn credits through planting trees, improving the agricultural practices such as Savannah fire management, reducing grazing levels and reducing the fertilizer emissions. They can sell these carbon credits locally and internationally, at the current price on the climate exchange, for activities that increase carbon sequestration.

As for other individuals, even if there are no particular provisions for selling carbon credits, you can certainly make a difference to the environment by ensuring that you do not emit more carbon and use those products which cause lesser carbon emission. The carbon trading mechanism, thus, can go a long way in helping us to achieve the goal of carbon neutrality and build up a parallel carbon market to the global crude oil market, as was envisaged many years ago.

Carbon Trading

Carbon Trading

Emission trading refers to an administrative perspective for controlling pollution by facilitating economic incentives to achieve a decline in the emission of pollutants. Cap and trade is another name for emission trading. When this trading happens with regard to the emission of carbon dioxide, it pertains to carbon trading.

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