Carbon credits explained: what is one carbon credit?
What one carbon credit means, compliance vs voluntary markets, avoidance vs removal, additionality, permanence, registries, ICVCM labels and Article 6, in plain words.
What this means for you
For individuals
You do not need carbon credits to act on climate. If you consider buying them, check the standard, the project type (avoidance or removal), the vintage year, the registry serial number and proof of retirement in your name. Be wary of anyone who promises earnings from carbon credits.
For businesses
Measure your emissions first (Scope 1, 2 and 3) and set a reduction plan. If you use credits, disclose which ones, the standard, the project type and the retirement record, and avoid broad claims like "carbon neutral" unless you follow a recognised standard for that claim. Under India's CCTS, credits for compliance are Carbon Credit Certificates traded on Indian power exchanges, which is a separate system from the international voluntary market.
Sources: Verra: Verified Carbon Standard (VCS) Program; Verra: First ICVCM CCP labels now active on the Verra Registry (2024); ICVCM: Core Carbon Principles; ICVCM: Integrity Council approves three cookstove methodologies among latest decisions (2025); Gold Standard for the Global Goals; UNFCCC: The Paris Agreement (2015), Article 6; Ministry of Power / Gazette: Carbon Credit Trading Scheme, 2023, S.O. 2825(E), 28 June 2023 (cited via BEE Detailed Procedure for Compliance Mechanism); CERC (Terms and Conditions for Purchase and Sale of Carbon Credit Certificates) Regulations, 2026
This article was prepared with AI assistance and checked by the GreenEye team against the sources shown in each section.
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