Carbon retirement
Encyclopedia
Carbon retirement involves retiring allowances from emission trading schemes as a method for offsetting carbon emissions. Under schemes such as the European Union Emission Trading Scheme
, EU Emission Allowances (EUAs) represent the right to release carbon dioxide into the atmosphere, and are issued to all the largest polluters. Buying these allowances and permanently removing them forces industrial companies to reduce their emissions. Over time, the scheme will offer fewer allowances, making it much harder for industrial companies to sustain high emission levels without incurring financial penalties.
Unlike traditional offsetting projects, retirement is straightforward and transparent. There are no complex projects, methodologies, brokers or intermediaries and the issue of additionality is overcome.
European Union Emission Trading Scheme
The European Union Emissions Trading Scheme also known as the European Union Emissions Trading System, was the first large emissions trading scheme in the world. It was launched in 2005 to combat climate change and is a major pillar of EU climate policy...
, EU Emission Allowances (EUAs) represent the right to release carbon dioxide into the atmosphere, and are issued to all the largest polluters. Buying these allowances and permanently removing them forces industrial companies to reduce their emissions. Over time, the scheme will offer fewer allowances, making it much harder for industrial companies to sustain high emission levels without incurring financial penalties.
Unlike traditional offsetting projects, retirement is straightforward and transparent. There are no complex projects, methodologies, brokers or intermediaries and the issue of additionality is overcome.