Whether you’re an individual looking to offset your greenhouse gas emissions, or a company looking to make a profit from a carbon project, the US carbon credit exchange can help. As of March, the market is on track to reach a record of $6.7 billion by 2021, and it’s expected to grow at a 31% CAGR over the next few years. It’s becoming more and more popular among individuals, businesses, and institutions as well. Those looking to reduce their carbon footprint will be able to find credits for nearly any project.
The market is divided into two main categories: the compliance carbon credit exchange and the voluntary carbon market. The compliance market operates under a regulatory framework, while the voluntary market operates independently. Those looking to buy carbon credits will need to verify that the projects they are buying are genuine. This is done by obtaining independent assurance from a third-party certification agency. Unlike the compliance market, the voluntary market does not have a cap on the amount of carbon dioxide that can be emitted.
In the compliance market, companies that are required to reduce their emissions can purchase credits to offset their emissions. Companies can also sell their excess permits. Those who exceed their emissions caps can purchase additional credits to cover their emissions.
There are two major carbon credit exchanges, the CTX Exchange and the ACX Exchange. Both exchanges have locations in Asia and Europe. The CTX Exchange is the largest market, with a minimum trading volume of 100 tons of CO2e. Buyers on the CTX Exchange include a wide range of individuals, small reseller brokers, and large trading houses.
Those looking to buy carbon credits on the CTX Exchange can choose from four currencies: USD, EUR, GBP, and AUD. There are two types of carbon credits: those issued directly by the carbon capturer, and those issued through a middleman. Buying direct can help you get the most value for your money, while buying through a middleman can allow you to earn a profit from the transaction.
The carbon credit market is expected to grow to $2.4 trillion by 2027. This market has been growing in part due to continued emphasis on carbon emissions reduction. Traders project that the price of carbon will increase by 88 percent by 2030, reaching $67 per metric ton.
The US carbon credit exchange will be built with scale, security, and speed, allowing buyers and sellers to conduct business in real time. It will also have a project marketplace, enabling buyers to purchase high-quality carbon credits directly from specific projects. The exchange will use machine learning and satellite monitoring to strengthen market integrity. It will also have two platforms, one dedicated to the compliance carbon market, and one to the voluntary carbon market.
Buying carbon credits is an effective way to meet environmental regulations. Credits can be bought from projects that would have occurred in spite of the regulations, such as agricultural practices, direct capture of emissions, or the planting of trees. The prices of carbon credits vary, from just a few cents per ton of CO2 to $15 per metric ton for afforestation projects to $300 per metric ton for tech-based removal projects, such as carbon capture and sequestration (CCS).