Monday, 12 September 2011

Carbon Credits & Renewable Energy Certificates Explained

What are carbon credits?

Carbon credits are tradable certificates or permits that represent a specific quantity of greenhouse gas emissions.

One carbon credit is equivalent to one metric tonne of carbon dioxide or carbon dioxide equivalent gases.

There are many companies that sell carbon credits and it is also traded on exchange platforms, such as the Carbon Trade Exchange.

Businesses and individual consumers can purchase carbon credits to offset their emissions and lower their carbon footprint on a voluntary basis.

Carbon credits are used in countries that have signed an agreement to lower emissions under the Kyoto Protocol which sets limits to the amount of greenhouse gasses a country can emit.
What are Renewable Energy Certificates?

Renewable Energy Certificates (RECs) are commodities that represent proof that 1 megawatt of electricity was generated from a renewable energy source.

RECs are similar to carbon credits in that they can be purchased and traded.

The Renewable Portfolio Standard is a policy that exists in 29 states in the US and has set a requirement for electric companies to supply a certain percentage of electricity from renewable sources.

For example, 33% of electricity must come from renewable sources in California by 2020. This means that electric companies in California must have RECs equivalent to 33% of their sales.

RECs are also purchased by corporations and individuals on a voluntary basis.

Who uses them?
Travellers that take a flight with Air Canada can offset their carbon footprint through Air Canada’s Carbon Offset Program. It is offered through a partnership with Zerofootprint, a non-profit organization. Travellers can estimate the cost of their share of emissions from their flight and purchase corresponding carbon credits. The program launched in May 2007 and as of September 2010, there has been a total of $263,042 carbon offset purchases made. That is equal to 16,141 tonnes of carbon.

The tennis event was held in Quebec and Tennis Canada was committed to ensuring there was minimal impact to the environment. All greenhouse gas emissions that resulted from the travels of the event’s players and staff were offset with the purchase of Gold Standard carbon credits from Planetair.

The Super Bowl is a major event and is also a massive consumer of energy. The event uses enough electricity to power 1,500 homes for a year! In an attempt to remain environmentally friendly, the NFL purchased renewable energy certificates from Just Energy to offset all carbon emissions from the 2011 event. The deal insures that for every megawatt of electricity used by Super Bowl 2011, a megawatt of clean energy is produced by the Sweetwater Wind Farm located just outside of Dallas, Texas.
Vancity, a leading credit union in Canada, teamed up with Offsetters, a carbon management provider, back in 2008. In doing so, Vancity became North America’s first financial institution to achieve carbon neutrality. It has recently been announced that the two companies will continue to work together and Vancity will further invest in carbon credits to offset its emissions. 

The Vancouver 2010 Olympic Games set a standard by being the first organizing committee to track the carbon emissions from the start of winning the bid to the final day of the games. An estimated 270,000 tons of carbon emissions were attributed directly and indirectly from the games. The emissions were offset by investing in clean technology through a partnership with Offsetters. Attendees of the games were also encouraged to purchase carbon credits to offset their emissions.

And many more!

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