A carbon offset is a credit that an individual or organization can purchase to mitigate a carbon footprint. 1 carbon offset = 1 metric ton of Co2. As soon as the number of carbon offsets purchased is equal to an individual or organization's carbon footprint, that person or organization is known as carbon neutral.
Revenue generated from the purchase of carbon offsets is often used to fund environmentally-friendly projects, such as investments in green computing technologies, tree planting, renewable energies (wind farms, biomass energy, hydroelectric dams...) or energy efficiency projects.
There are two markets for carbon offsets. The largest is the compliance market which is mainly composed of companies and governments who purchase carbon offsets in order to comply with their Co2 threshold. The voluntary market, much smaller, is composed of individuals, companies or governments who purchase carbon offsets to compensate their greenhouse gas emissions caused by transportation, energy use and other sources.
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