Carbon Trading

Carbon trading is a market-based approach to controlling greenhouse gas emissions by setting a cap on the total amount of emissions that can be released by regulated entities, such as industries and power plants. Entities are allocated emission allowances, which can be bought, sold, or traded as needed. This creates an economic incentive for companies to reduce their emissions, as they can profit from selling unused allowances. Carbon trading systems aim to achieve environmental goals in a cost-effective and flexible manner.