Can you buy and sell carbon dioxide?

A primer on carbon trading

PUBLISHED: June 3, 2020

Do you know that by conserving your forest, you may also be able to make money?

Since the Kyoto Protocol in 1997, countries and firms are looking to lower their overall carbon emissions.

However, besides cutting their own emissions, governments and firms could pay others to do so on their behalf.

These governments and firms obtain permission to release more carbon emissions when they buy carbon credits.

By buying carbon credits, they can hence offset their own emissions.

This process is called

carbon trading

Conserving a forest plot saves it from being cut down for carbon-emitting uses, such as for factories. Instead of producing carbon dioxide, the forest will absorb carbon dioxide.

Answer: False! Only forests deemed to be at high risk of deforestation can qualify as a source of carbon credits.

If about 1.55 billion hectares of tropical forests were conserved, these plots could generate more than S$61 billion a year through the sale of carbon credits.

FUN FACT:

However, unless the price of carbon goes up significantly, many forest preservation projects would not be viable, as the cost to manage the land would be more than the potential returns.

Even for profitable projects, the lure of other more lucrative land uses could pose barriers to forest conservation.


READ THE ARTICLE
READ THE ARTICLE

What Singapore is doing

Singapore is launching a new global carbon exchange platform, Climate Impact X (CIX), to help firms go green and boost efforts to establish Singapore as a carbon services and trading hub.

READ THE ARTICLE
READ THE ARTICLE

SOURCE: ST REPORTS BY AUDREY TAN AND SUE-ANN TAN; ANIMATIONS BY CHARLENE CHUA; PHOTOS BY BLOOMBERG, SPH AND AFP

PRODUCED BY: CHARLENE CHUA

MORE VISUAL STORIES
MORE VISUAL STORIES