FAQ

‘Carbon offset’ and ‘carbon credit’ are terms that are generally used interchangeably. ‘Carbon credit’ is more often used in reference to a financial unit of measurement that represents the removal of one tonne (1,000 kg or 2,205 lbs.) of carbon from the atmosphere.

‘Carbon offset’ is often used when referring to an action. Carbon offsets or carbon credits have the same function to compensate for emissions occurring elsewhere (via reduction, avoidance, or sequestering).

Carbon offsets are measured in metric tons (tonnes) of carbon dioxide equivalents (mTCO₂e). One tonne = 1,000 kg or 2,205 lbs. For each tonne of CO2 mitigated by a carbon project, one carbon credit is issued.

Organizations & businesses offset their CO2 emissions to meet voluntary emission targets and compulsory norms set forth by the government. The organizations may also want to meet their sustainable needs and stakeholder demands for offsetting carbon footprint and achieving Net Zero as per the Paris Agreement Treaty.

"A carbon offset project can be defined as any project, or set of deliberate activities to reduce the amount of greenhouse gas (mainly Carbon Dioxide) in the atmosphere. These criteria include additionality, detailed quantification of the greenhouse gas reduction or removal activity as compared to a baseline, and permanence. There are many different types of carbon projects that are eligible to generate carbon credits as long as they adhere to the requirements of methodologies that have been approved by the standards bodies. In short, any project that is avoiding CO2 emission or sequestering carbon from the environment.
For example, replacing a coal plant with a planned life of 30 years with a solar farm after year 5 would avoid 25 years of coal emissions. The difference is how many carbon credits the project would likely earn.
Alternatively, taking land that is desertified and degraded, and planting millions of trees to bring it back to life and sequestering carbon would pull more emissions out of the air than without planting millions of trees."

Carbon credit projects are based on the principles of widely accepted mechanisms for reducing emissions. There are various methodologies for reducing emissions including providing clean cookstoves, preserving forests or grasslands, capturing methane, or running small-scale renewable energy projects, EV vehicles etc. Each project offers a specific type of carbon credit for sale.

Carbon credit generation process varies from project to project/ methodology selected and registry considered. It requires the owner to provide open support and desired documents as per standards. Time of generation could range from 3-10 months.

The compliance market is driven by national, regional or international law stating that companies and governments must account for their greenhouse gas emissions.

The voluntary market is the voluntary offset of emissions by a company, organization, or individual. BlueEarth Environment represents carbon credits to be used by the both voluntary and compliance market.

The main, internationally and nationally-recognized standards, bodies are the Gold Standard (GS), Verra (VCS), Universal Carbon Registry (UCR) ,CDM, I-REC etc. Each organization maintains a standard that provides guidelines for new and existing carbon projects and approves methodologies for specific project types. The standards bodies also act as registries, commonly referred to as tracking systems, enabling project owners to publicly share project documents, issue and transfer credits, and for end-users to retire credits. Registries play a critical role in maintaining a credible market and transparently documenting credit issuances and retirements.

All carbon credit projects must be “additional”, meaning that the activity wouldn’t have occurred in the absence of the carbon market. This is essential because carbon credit buyers shouldn’t be financing activities via carbon credit revenue that would have occurred anyway. All projects are required to provide evidence that the emission reductions or removals are not “business as usual”. All projects must quantify a baseline, which is the total quantity of emissions in a specific timeframe that occurred prior to the implementation of the project. BlueEarth Environment provides active support in assessing the additionality of the project while working with the client.

Each project is monitored by the standard authorities, an independent auditor, and BlueEarth as required. We at BlueEarth, ensure that the project is proceeding as planned. We make field visits to the projects as well to review their work on-site.

There are many reasons for the cost disparity for carbon credits from various projects including number of credits, location, project quality, SDG goals satisfied, registry and ongoing monitoring/verification expenses. Projects that offer significant co-benefits often command a premium in the market, particularly benefits that align with contributions towards Sustainable Development Goals (SDGs). Since carbon credits are a market-based mechanism, credit prices are subject to supply and demand fundamentals, meaning the market price will go up when there is more demand and/or less supply.

With our tools and strategic collaborations, BlueEarth develops projects centered around reducing the effects of climate change. These projects need financing to stay afloat in the long run. With Climate impact investments, we offer investment opportunities to businesses where they can also receive the benefits of their investments in terms of climate commodities.

Much like how carbon credits are generated through offsetting activities, Plastic credits are created through the management of plastic waste which includes recycling and reducing.

As a step to prevent plastic pollution, the Central Pollution Control Board (CPCB) has made it mandatory for businesses to take partial responsibility for the waste they produce (which also includes plastic). Extended Producer Responsibility (EPR) authorization is a must to achieve for all Indian manufacturers and importers under the CPCB rules, 2016.