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With reference to Carbon Markets, consider the following statements:
1. A carbon credit is a kind of tradable permit that equals one tonne of carbon dioxide removed, reduced, or sequestered from the atmosphere.
2. Paris Agreement provides for the use of international carbon markets by countries to fulfil their nationally determined contributions (NDCs).
Which of the statements given above is/are correct?
- a)1 only
- b)2 only
- c)Both 1 and 2
- d)Neither 1 nor 2
Correct answer is option 'C'. Can you explain this answer?
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Most Upvoted Answer
With reference to Carbon Markets, consider the following statements:1....
Carbon Markets and the Paris Agreement
Statement 1: A carbon credit is a kind of tradable permit that equals one tonne of carbon dioxide removed, reduced, or sequestered from the atmosphere.
The statement is correct. A carbon credit is indeed a tradable permit that represents a reduction or removal of one tonne of carbon dioxide (or its equivalent in other greenhouse gases) from the atmosphere. It is a way to incentivize and finance projects that reduce emissions or enhance carbon sinks. These projects can include renewable energy installations, reforestation efforts, or energy efficiency initiatives. Carbon credits can be bought and sold in carbon markets, allowing organizations or countries to offset their emissions by purchasing credits from projects that have reduced or removed emissions.
Statement 2: The Paris Agreement provides for the use of international carbon markets by countries to fulfill their nationally determined contributions (NDCs).
The statement is also correct. The Paris Agreement, which was adopted in 2015, aims to combat climate change by limiting global warming to well below 2 degrees Celsius above pre-industrial levels and pursuing efforts to limit the temperature increase to 1.5 degrees Celsius. To achieve this, each country is required to submit their nationally determined contributions (NDCs), which outline their efforts to reduce greenhouse gas emissions.
The Paris Agreement recognizes the importance of international cooperation and the use of market mechanisms to achieve emission reductions. Article 6 of the agreement specifically addresses the use of carbon markets, including the concept of internationally transferred mitigation outcomes (ITMOs). ITMOs allow countries to transfer or trade emission reductions achieved beyond their own NDCs to other countries that need additional emissions reductions to meet their targets. This provides flexibility and cost-effectiveness in achieving global emission reductions.
Therefore, both statements are correct. Carbon credits are tradable permits that represent one tonne of carbon dioxide reduced or removed, and the Paris Agreement allows for the use of international carbon markets to fulfill countries' NDCs.
Statement 1: A carbon credit is a kind of tradable permit that equals one tonne of carbon dioxide removed, reduced, or sequestered from the atmosphere.
The statement is correct. A carbon credit is indeed a tradable permit that represents a reduction or removal of one tonne of carbon dioxide (or its equivalent in other greenhouse gases) from the atmosphere. It is a way to incentivize and finance projects that reduce emissions or enhance carbon sinks. These projects can include renewable energy installations, reforestation efforts, or energy efficiency initiatives. Carbon credits can be bought and sold in carbon markets, allowing organizations or countries to offset their emissions by purchasing credits from projects that have reduced or removed emissions.
Statement 2: The Paris Agreement provides for the use of international carbon markets by countries to fulfill their nationally determined contributions (NDCs).
The statement is also correct. The Paris Agreement, which was adopted in 2015, aims to combat climate change by limiting global warming to well below 2 degrees Celsius above pre-industrial levels and pursuing efforts to limit the temperature increase to 1.5 degrees Celsius. To achieve this, each country is required to submit their nationally determined contributions (NDCs), which outline their efforts to reduce greenhouse gas emissions.
The Paris Agreement recognizes the importance of international cooperation and the use of market mechanisms to achieve emission reductions. Article 6 of the agreement specifically addresses the use of carbon markets, including the concept of internationally transferred mitigation outcomes (ITMOs). ITMOs allow countries to transfer or trade emission reductions achieved beyond their own NDCs to other countries that need additional emissions reductions to meet their targets. This provides flexibility and cost-effectiveness in achieving global emission reductions.
Therefore, both statements are correct. Carbon credits are tradable permits that represent one tonne of carbon dioxide reduced or removed, and the Paris Agreement allows for the use of international carbon markets to fulfill countries' NDCs.
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With reference to Carbon Markets, consider the following statements:1....
The Energy Conservation (Amendments) Bill, 2022, passed by the Rajya Sabha recently, has several significant features. It will foster a carbon market in India, through the creation of a National emissions trading system (National ETS).
What are carbon markets?
- Article 6 of the Paris Agreement provides for the use of international carbon markets by countries to fulfil their nationally determined contributions (NDCs).
- Carbon markets are essentially a tool for putting a price on carbon emissions— they establish trading systems where carbon credits or allowances can be bought and sold.
- A carbon credit is a kind of tradable permit that, per United Nations standards, equals one tonne of carbon dioxide removed, reduced, or sequestered from the atmosphere.
- Carbon allowances or caps, meanwhile, are determined by countries or governments according to their emission reduction targets.
- A United Nations Development Program released recently noted that interest in carbon markets is growing globally, i.e, 83% of NDCs submitted by countries mention their intent to make use of international market mechanisms to reduce greenhouse gas emissions.
What are the types of carbon markets?
- There are broadly two types of carbon markets:
- compliance markets and
- voluntary markets
Voluntary markets:
- Voluntary markets are those in which emitters— corporations, private individuals, and others— buy carbon credits to offset the emission of one tonne of CO 2 or equivalent greenhouse gases.
- Such carbon credits are created by activities which reduce CO 2 from the air, such as afforestation.
- In a voluntary market, a corporation looking to compensate for its unavoidable GHG emissions purchases carbon credits from an entity engaged in projects that reduce, remove, capture, or avoid emissions.
- For Instance, in the aviation sector, airlines may purchase carbon credits to offset the carbon footprints of the flights they operate. In voluntary markets, credits are verified by private firms as per popular standards. There are also traders and online registries where climate projects are listed and certified credits can be bought.
Compliance markets:
- Compliance markets— set up by policies at the national, regional, and/or international level— are officially regulated.
- Currently, compliance markets mostly operate under a principle called ‘cap-and-trade”, most popular in the European Union (EU).
- Under the EU’s emissions trading system (ETS) launched in 2005, member countries set a cap or limit for emissions in different sectors, such as power, oil, manufacturing, agriculture, and waste management.
- This cap is determined as per the climate targets of countries and is lowered successively to reduce emissions.
- Entities in this sector are issued annual allowances or permits by governments equal to the emissions they can generate.
- If companies produce emissions beyond the capped amount, they have to purchase additional permit, either through official auctions or from companies which kept their emissions below the limit, leaving them with surplus allowances.
- This makes up the ‘trade’ part of cap-and-trade.
Hence both statements are correct.
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With reference to Carbon Markets, consider the following statements:1. A carbon credit is a kind of tradable permit that equals one tonne of carbon dioxide removed, reduced, or sequestered from the atmosphere.2. Paris Agreement provides for the use of international carbon markets by countries to fulfil their nationally determined contributions (NDCs).Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'C'. Can you explain this answer?
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With reference to Carbon Markets, consider the following statements:1. A carbon credit is a kind of tradable permit that equals one tonne of carbon dioxide removed, reduced, or sequestered from the atmosphere.2. Paris Agreement provides for the use of international carbon markets by countries to fulfil their nationally determined contributions (NDCs).Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'C'. Can you explain this answer? for UPSC 2024 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about With reference to Carbon Markets, consider the following statements:1. A carbon credit is a kind of tradable permit that equals one tonne of carbon dioxide removed, reduced, or sequestered from the atmosphere.2. Paris Agreement provides for the use of international carbon markets by countries to fulfil their nationally determined contributions (NDCs).Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'C'. Can you explain this answer? covers all topics & solutions for UPSC 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for With reference to Carbon Markets, consider the following statements:1. A carbon credit is a kind of tradable permit that equals one tonne of carbon dioxide removed, reduced, or sequestered from the atmosphere.2. Paris Agreement provides for the use of international carbon markets by countries to fulfil their nationally determined contributions (NDCs).Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'C'. Can you explain this answer?.
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