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With reference to the Carbon Markets, consider the following statements:
  1. 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.
  2. 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.
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?
Most Upvoted Answer
With reference to the Carbon Markets, consider the following statement...
The Ministry of Power and Ministry of Environment will develop Carbon Credit Trading Scheme for Decarbonisation. Government plans to develop the Indian Carbon Market with the objective to decarbonize the Indian economy by pricing the Green House Gas emission through trading of Carbon Credit Certificates. 
What are Carbon Markets?
  • 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 release this year 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.
Two types of Carbon Markets:
  • These are set up by policies at the national, regional, and/or international level— are officially regulated.
  • 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.
  • The market price of carbon gets determined by market forces when purchasers and sellers trade in emissions allowances.
Voluntary Market:
  • These are markets in which emitters— corporations, private individuals, and others— buy carbon credits to offset the emission of one tonne of CO2 or equivalent greenhouse gases.
  • Such carbon credits are created by activities which reduce CO2 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.
Hence both statements are correct.
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With reference to the Carbon Markets, consider the following statements: Carbon markets are essentially atool for putting a price on carbon emissions— they establish trading systems where carbon credits or allowances can be bought and sold. Acarbon creditis a kind of tradable permit that, per United Nations standards,equals one tonne of carbon dioxide removed, reduced, or sequestered from the atmosphere.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 the Carbon Markets, consider the following statements: Carbon markets are essentially atool for putting a price on carbon emissions— they establish trading systems where carbon credits or allowances can be bought and sold. Acarbon creditis a kind of tradable permit that, per United Nations standards,equals one tonne of carbon dioxide removed, reduced, or sequestered from the atmosphere.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 the Carbon Markets, consider the following statements: Carbon markets are essentially atool for putting a price on carbon emissions— they establish trading systems where carbon credits or allowances can be bought and sold. Acarbon creditis a kind of tradable permit that, per United Nations standards,equals one tonne of carbon dioxide removed, reduced, or sequestered from the atmosphere.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 the Carbon Markets, consider the following statements: Carbon markets are essentially atool for putting a price on carbon emissions— they establish trading systems where carbon credits or allowances can be bought and sold. Acarbon creditis a kind of tradable permit that, per United Nations standards,equals one tonne of carbon dioxide removed, reduced, or sequestered from the atmosphere.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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