ICBE > About Emissions Trading > Carbon as a Commodity > FAQs on Carbon
Faqs on Carbon

How much is a carbon credit worth?
The value of a carbon credit is influenced by the amount of tax levied on the carbon or other greenhouse gas emissions, the penalties provided for exceeding an agreed upon emissions target, the cost to achieve the reduction, and traditional demand and supply of the reduction product.

Some countries already have a carbon dioxide tax; Denmark's carbon tax is $25 per ton, the UK introduced one in 2001.  Whatever the value of a carbon credit is, it translates to income for activities where emission reductions are being achieved. ICBE provides a venue for tracking emission and reduction activities, receiving credit for reductions, providing a venue to exchange reductions, and documenting transfers to the proper authorities.

There is one ton of carbon in 3.67 tons of CO2  

Is carbon trading the answer to the greenhouse problem?
No. The greenhouse problem will only go away when carbon dioxide and other greenhouse gas concentrations are brought back to or near pre-industrial levels. Carbon trading as a system is not cognant of what the right concentration level of atmospheric CO2 is. Carbon trading is dependent on human consensus to achieve desired greenhouse gas concentration and preferred climate conditions.
Carbon trading is only part of the solution. It allows flexibility in achieving reductions, lowering costs for a broad range of participants. This makes it more attractive for utilities, industries and individuals when considering options such as increasing efficiency, switching to renewable energy use, harvesting carbons, or conserving energy use in other ways.

What is the solution for the greenhouse problem?
The solution is a significant reduction of the greenhouse gases produced by mankind. This can be achieved by coordinating participation on government, industry, community and individual levels. Luckily, the technology to drive our economies emissions free is already available, and a shift over time to these alternate sources of energy is within our means.

Why focus first on carbon dioxide?
Carbon dioxide is released in greater amounts and represents 50% of the warming attributed to greenhouse gases. As the major contributor of global warming, any serious environmental and economic program must first address this issue. The bulk of carbon dioxide comes from generating power and moving about in fossil fuel powered vehicles, the rest comes from agricultural and other activities.

What are some of the other greenhouse gases?
Some of the other greenhouse gases are methane, nitrous oxide, halocarbons, and sulfur hexafluoride. These and other greenhouse gases are indexed by their Global Warming Potential (GWP) so they can be expressed in carbon dioxide units. All greenhouse gases can be included in the carbon-trade market.

Why is it OK to trade carbon credits internationally?
Because this mirrors the physical behavior of carbon in the atmosphere. Carbon dioxide released into the atmosphere in Wisconsin may travel to England, then Egypt, then Zimbabwe before it is absorbed by living matter. In fact, it could wander locally or globally for years, even centuries, before it is snared by a plant or breaks down in the atmosphere. From this perspective, the atmosphere is a pool, and you can add or subtract carbon at any point and influence the amount in the pool.
International carbon trading's utility is to help man regulate the global atmospheric level of carbon dioxide and other greenhouse gases.

What is the benefit of turning emission reductions into financial products?
Creating a value for emission reductions credits from renewable energy systems and other activities is one of the main purposes of the ICBE. The monies generated by providing these services will enable financial products to widen RE use in home and community settings.
We feel that the creation of supporting financial products to alleviate the up front costs associated with new devices is a key component for a sustained expansion of the renewable energy market and the shift to a clean energy world.

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