Emission Reduction Credits (ERC's) represent a reduction of a given quantity of
gas. In the terrestrial carbon market the unit often referred to is tCO2, or
(metric) ton of carbon dioxide. Because carbon dioxide is the major greenhouse
ERC's are sometimes referred to as carbon credits. Carbon dioxide and several other
greenhouse gases are suspected of influencing how our
atmosphere functions and potentially altering earth's climate systems.
Emissions Trading is moving a reduction in emissions output from
one party to another. The reduction can then be subtracted from the
recipient party's total output. The recipient uses the reduction to achieve
a voluntary or legislative emissions target.
Emissions Trading reduces costs by allowing a field of players to achieve
and sort out emissions
reductions using market mechanisms. Over time, these mechanisms can drive emissions down
and help finance the shift to clean energy.
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