How It Works🌍Global·Climate & Environment·5 min read
How Carbon Credits Work
The difference between compliance and voluntary markets, and what one credit actually represents.
Verified as of 18 July 2026
TL;DR
One carbon credit represents one tonne of CO₂ equivalent that has been avoided, reduced or removed. Compliance markets are set by regulators; voluntary markets let companies buy credits to offset emissions.
Verification · 0 sourced claims · Last verified 18 July 2026
What a credit represents\nOne credit = one tonne of CO₂ equivalent (CO₂e), verified by a standard body such as Verra or Gold Standard.\n\n## Compliance vs voluntary\n- Compliance markets (e.g. EU ETS) are mandated by law for covered emitters.\n- Voluntary markets are used by companies making net-zero claims.
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