Carbon credits are bought and sold to offset carbon emissions. Over the past five years the carbon credit market has gone from zilch to $300 billion, in anticipation of government’s placing a tax on carbon emissions. The logic behind CCs is simple: those who surpass their state-mandated quota buy credits from parties whose emissions stay under the quota. Companies can, for instance, plant, or buy, forests that can offset carbon emissions. Within the next decade, most estimates put the CC market at $3-4 trillion.
For an interesting look at how the CC market is playing out in Brazil I recommend a Frontline World documentary aired on PBS. “The Carbon Hunters” delves into logging and the carbon market in Brazil.
