Carbon credits are a relatively new and often poorly understood area of finance. They are a market-based approach to dealing with some of the externalities that we, as humans, create. By putting a price on emissions, it encourages participants of the scheme to be more efficient, and, in theory, it can help drive positive change. A similar method has been successful in dealing with acid rain. Despite the name, Carbon credits is a catch-all name for a number of markets covering a range of greenhouse gases such as: carbon dioxide, methane, carbon monoxide and HFCs. Currently these marke...
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