Avoidance or Removal Carbon Credits? Which to Choose.
Looking for the best-price carbon credit? To make your decision, you need to know the difference between avoidance and removal carbon credits. In the end, you’ll probably want some of both…
Avoid or Remove? The Carbon Credit Question
How do you know what type of carbon credit to choose? If you’re reading this article, you’re probably looking for a voluntary carbon credit, and you probably want one that is trustworthy and has a high potential resale value. The value of voluntary carbon credits is determined by a variety of factors, and also by carbon credit category. There are two main categories of voluntary carbon credit. These are ‘avoidance’ carbon credits, and ‘removal’ carbon credits.
Avoidance Carbon Credits
Avoidance carbon credits are carbon credits issued from projects that avoid emitting more carbon dioxide or greenhouse gases (GHG) into the atmosphere. Avoidance projects could be:
- Developing renewable energy projects like offshore wind turbines,
- Incentivizing farmers to leave certain fields fallow to stock carbon
- Protecting endangered forests from deforestation, leaving their carbon stocks intact
Removal Carbon Credits
Removal carbon credits are carbon credits issued from projects that remove carbon dioxide or GHGs from the atmosphere. Removal projects could be:
- Nature-based, like regenerating forests and wetlands, which stock carbon and restore biodiversity
- Tech-based, using strategies like direct air capture or enhanced mineralization¹
- Hybrid strategies, like enhancing root crops²
Avoidance or Removal? Which to Invest In?
Both. According to a McKinsey analysis, “at least 5 gigatons of negative emissions will be needed annually to reach net-zero emissions by 2050.³” Negative emissions are emissions absorbed through carbon removal practices. But we also must avoid producing more carbon emissions, hence the need for avoidance carbon credits.
It’s not a big deal if you don’t totally understand how stocking carbon in fallow fields (avoidance) or direct air capture (removal) works. What is important to remember is that each method can take carbon out of the atmosphere, and stock it, helping to restore balance to the carbon cycle and slow global climate change. In terms of price, S&P Global Commodities Insights reports that historically, credits issued from carbon removal projects have a higher price⁴.
CarbonABLE’s Nature-Based Carbon Credits
As we saw, there are many types of projects and technologies in each carbon credit category. We need both types to balance the world’s carbon cycle. At CarbonABLE, our NFTs represent both carbon avoidance and carbon removal projects, as long as they fall in the “nature based,” categories. We believe that protecting and restoring natural resources that already exist is one of the most promising solutions we can act on to help restore our planet.
And we’re not alone: Sylvera, an agency that rates the quality of voluntary carbon credits, released a report about an upcoming ‘carbon credit crunch’,⁵ in which the market will shift towards nature-based carbon credits. Get involved to help restore nature and receive a high resale value now!
Sources
(1)1https://www.wri.org/initiatives/carbon-removal(2)https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3158691/(3)https://www.mckinsey.com/business-functions/sustainability/our-insights/how-the-voluntary-carbon-market-can-help-address-climate-change(4)https://www.spglobal.com/commodity-insights/en/market-insights/blogs/energy-transition/061021-voluntary-carbon-markets-pricing-participants-trading-corsia-credits(5)2022 Carbon Credit Crunch Report, Sylvera
