By Brian Okoth
Carbon credits, carbon taxes, carbon offset and carbon leakage are some widely used terms in climate action summits.
Africa has been at the forefront, pushing to sell to the developed countries "carbon credits."
The continent is the least polluter of the environment, given its low industrialisation, according to the US Department of Energy.
So, when it says it wants to sell "carbon credits" to the developed nations, what does it mean?
Human activities
In climate change context, carbon is the short-form of carbon dioxide, a gas that reduces the earth's ability to "cool itself off" by radiating energy into space.
Human activities have raised the atmosphere's carbon dioxide content by 50% in less than 200 years, thus making the planet warmer, the National Institutes of Health says.
The burning of fossil fuels such as gas, petrol, oil and coal results in the generation of carbon dioxide.
Studies have indicated that countries with a high number of factories, which use the fossil fuels to operate, pollute the environment more, hence causing global warming.
Extreme weather conditions
Drought, heavy rainfall, melting of glaciers, sea level rise, intense heat waves, shifting rainfall pattern, flooding and skin cancers due to depletion of the ozone layer are some of the effects of a warmer planet.
"Glaciers contribute to stream flow, and hence are an important water resource. Glacier recession therefore threatens ecosystems and human activities," Neeral Shah, a Kenya-based climate change expert, tells TRT Afrika.
The ozone layer, an atmospheric shield, absorbs a portion of the radiation from the sun, preventing it from reaching the planet's surface. This, in turn, prevents harmful effects of the sun's ultraviolet rays such as skin cancer.
According to Worldometer, China, the United States, India, Russia, Japan, Germany, Canada, Iran, South Korea and Indonesia are the world's leading carbon emitters due to their high number of carbon-intensive industries, or products.
Least-polluting countries
Sao Tome and Principe, Cape Verde, Comoros, The Gambia, Lesotho, Guinea-Bissau, the Central African Republic and Eswatini are among the world's least carbon emitters.
Now, let's return to carbon credit. It refers to the permit bought by companies that emit carbon dioxide – or pollute the atmosphere – due to the nature of their business.
A single credit represents one tonne of carbon dioxide (or its equivalent) that the company is allowed to emit. The average price for one unit goes for between $40 and $80 currently.
It is important to note that not all carbon-intensive companies pay the fee. The fee is paid by factories operating in countries or regions that have laws that regulate carbon emissions, for instance the European Union bloc or Paraguay.
How carbon credits are traded
The carbon credit trade happens like this: a company is allocated – by government or a regulator – the maximum level of carbon dioxide that it can emit. If it surpasses that ceiling, then it has to buy carbon credits to allow it to continue operating.
There are government-mandated agencies that deal in selling carbon credits, for instance One Carbon World.
For carbon offset, there are certain companies that by the nature of their operations, they remove carbon dioxide from the atmosphere, for instance firms that grow trees for sale.
According to the US Department of Agriculture, in one year a mature tree absorbs more than 48 pounds (21.8kgs) of carbon dioxide from the air, and releases oxygen in exchange.
Carbon taxes
A carbon-intensive company can approach these carbon-sucking companies to buy credits, which would allow the "pollutant" a higher ceiling for carbon emission. This type of trade is called "carbon offset."
Carbon taxes refer to the levy imposed on people who use products that emit carbon gases into the air. For instance, a government imposing a carbon tax on people who drive petrol or diesel-powered vehicles, or taxes on goods manufactured by carbon-intensive industries.
Carbon leakage refers to a situation where a company decides to move its production from a country with tough anti-carbon emission policies – such as heavy fines or carbon credit fees – to a country that is more lenient.
"We should work with the Democratic Republic of Congo and Congo-Brazzaville to preserve the Congo Rainforest, a major driver of weather patterns across the globe," Neeral Shah says.
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