Carbon credits (permits that allows the holder to emit one ton of CO2) are often maligned because it’s impossible to know how much carbon is actually reduced from their purchase. In many carbon markets, buyers are only able to purchase blended carbon credits that make it difficult to know where the credit is actually going. A customer who purchases a carbon offset from a broker that sells blended credits has no idea if they are supporting a wind farm, a solar farm, or a biomass project–or all three.
The World Green Exchange’s (WGE) new transparency initiative aims to change that. The “virtual shopping mall” of carbon credits allows companies to choose which credits to buy based on price, vintage (when the carbon-saving activity occurred), location, volume, supplier, and more. One company on the site, for example, is auctioning off credits generated when it switched to biomass for energy creation. Another is auctioning off credits from a 2007 biopower wastewater project in Thailand.
The WGE operates using a simple principle–carbon credits should be verifiable–but it’s one that has been ignored in the past. With the WGE, companies can choose to support causes that they care about. Hopefully, the Exchange will set a precedent of transparency for when the U.S. government inevitably unveils a carbon tax or cap-and-trade system.