Carbon Credits & Footprints

Carbon is the building block of not only human life but of other life forms too, it is using this of carbon , better known as C-14 isotope that the archaeologists, paleoclimatologists have been to date objects and predict their correct life. It is using the knowledge of this carbon that we have been to make a classification for different epochs since our planets inception.

So important this carbon is , then how can it be a danger to us and our environment.

Confused….?

This carbon is not only a part of our body but also it is a part of fuels we burn to derive and generate energy , which is imminent for our survival but the rate at which we are doing this is alarming and we are harming our envirnoment thinking that if get too much into saving our environment ,it will cost the world’s economy hundreds of billions of dollars but what we fail to realise that the cost of doing nothing will act asl doom.

Apart from CO2 there are other green house gases like methane, nitrous oxide, fluoro carbon ,but these gases are much lower in concentration than carbon dioxide. Not only increasing levels of carbon dioxide but increasing levels of other green house gases are also potent greenhouse gases also pose a danger to our future. With our present actions we are trying to change the environment and not trying to protect and preserve it.

Carbon Footprint
                                                   Wondering what is this Tree

Trees

Carbon is the building block of life and it is using this carbon only that dating of the life/age of almost all things (having carbon content) can be predicted effectively. So important this carbon , Isn’t it ?. Economies all over the world are developing, with rapid industrialization we are using emitting a large amount of green houses gases into the atmosphere mainly carbon dioxide, but this carbon is not essential for us, though some of carbon dioxide is important for the atmosphere as it traps heta from sun and it prevents “Earth” from becoming a cold planet. But once the percentage of carbon dioxide /green house gases

It is not just the industries that are a contributor to the degradation of our environment but each and everyone amongst is a contributor to increase in % of these gases . We are leaving our footprints for our generations to time , not in the way to learn from our mistakes as History teaches us, but in a way that will make life tough for them and we better know these as ” Carbon Footprints”.

Footprint

Humans evolved to adapt to their surroundings but this evolution brought with it a footprint of human ” A Black and dark footprint” and not what we wanted for a cleaner and greener tommorow.

Some Sites to Calculate Carbon Footprint

Whenever you burn fossil fuels like petrol, gas, wood, etc, you inevitably generate the gas CO2 called carbon dioxide. This large emission of carbon dioxide is the main cause of global warming and all its side effects. Our goal must be to burn less fossil fuels for heating and for engines.

CO2 and carbon dioxide are just different names for exactly the same molecule.

Convert CO2 (kg) into C: multiply kg CO2 by 0.27

Convert C into CO2: multiply kg C by 3.70

Carbon Credit
As nations have progressed we have been emitting carbon, or gases which result in warming of the globe. Some decades ago a debate started on how to reduce the emission of harmful gases that contributes to the greenhouse effect that causes global warming. So, countries came together and signed an agreement named the “Kyoto Protocol” ( adopted under United Nations Framework for climate Change also known as UNFCC). It created a mechanism under which countries that have been emitting more carbon and other gases (greenhouse gases include ozone, carbon dioxide, methane, nitrous oxide and even water vapour) have voluntarily decided that they will bring down the level of carbon they are emitting to the levels of early 1990s.

A company has two ways to reduce emissions. One, it can reduce the GHG (greenhouse gases) by adopting new technology or improving upon the existing technology to attain the new norms for emission of gases. Or it can tie up with developing nations and help them set up new technology that is eco-friendly, thereby helping developing country or its companies ‘earn’ credits.

Industries like cement, steel, textiles and fertilizers contribute around 60% of Green House Gases. Besides oil and gas and infact we humans are also responsible for these gases. The gases adversely affect the ozone layer, leading to global warming. Carbon credits seek to reduce these emissions by giving them a monetary value. One credit gives the owner the right to emit one ton of carbon dioxide. Such a credit can be sold in the international market at the prevailing market price. This means that carbon becomes a cost of business and is seen like other inputs such as raw materials or labor.

Carbon Credits:How do they work ?
Assume a company X has in a country of Timbactu and it is emitting more gases than the accepted norms of the United Nations Framework for Climate Change( UNFCC). It can tie up with its own subsidiary in, another country say Chinchpokli under the Clean Development Mechanism wherein It can buy the ‘carbon credit’ by making Chinchpokli plant more eco-savvy with the help of technology transfer.

            Clean Development Mechanism
Under the UNFCCC, charter any company from the developed world can tie up with a company in the developing country that is a signatory to the             Kyoto Protocol. These companies in developing countries must adopt newer technologies, emitting lesser gases, and save energy.

           MCX trading in carbon credits
Many companies did not apply to get credit even though they had new technologies. Some companies used management consultancies to make           their plan greener to emit less GHG. These management consultancies then scouted for buyers to sell carbon credits. It was a bilateral          deal.However, the price to sell carbon credits at was not available on a public platform. The price range people were getting used to was about          Euro 15 or maybe less per tonne of carbon. Today, one tonne of carbon credit fetches around Euro 22. It is traded on the European Climate          Exchange. Therefore, you emit one tonne less and you get Euro 22. Emit less and increase/add to your profit.MCX is the futures exchange. People         here are getting price signals for the carbon for the delivery in next five years. Our exchange is only for Indians and Indian companies. Every year, in         the month of December, the contract expires and at that time people who have bought or sold carbon will have to give or take delivery. They can         fulfill the deal prior to December too, but most people will wait until December because that is the time to meet the norms in Europe.

Say, if the Indian buyer thinks that the current price is low for him he will wait before selling his credits. The Indian government has not fixed any norms nor has it made it compulsory to reduce carbon emissions to a certain level. So, people who are coming to buy from Indians are actually financial investors. There is a huge requirement of carbon credits in Europe before 2012. Only those Indian companies that meet the UNFCCC norms and take up new technologies will be entitled to sell carbon credits.

The Multi-Commodity Exchange of India (MCX) may soon become the third exchange in the world to trade in carbon credits.[source]

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