Energy Waste and Building Emissions are a Major Problem
Buildings account for 36 percent of global energy use and 39 percent of energy-related carbon dioxide emissions annually, according to the United Nations Environment Program. In the United States, residential and commercial buildings account for 40 percent of energy consumption, according to the U.S. Energy Information Administration.
Carbon Credits Help Accelerate Change
Carbon credits represent a rapidly growing sector which is split into two broader market segments 1) the Compliance or Regulated markets and 2) the Voluntary offset markets.
Compliance markets are highly regulated by governments and include specific industry targets and mandates and operate through an emission trading systems (ETS). Targets are set by Government and industry must comply. If industries don’t comply they face punitive action.
While these markets vary in application the basic mechanism is a cap-and-trade system where those that may be offside can trade with those who have excess credits to share.
Most large corporations and commercial buildings do not operate in this market. They operate in the voluntary offset market instead.
6
USD/ton C02
Weighted Carbon Price (5/17/2017)
0
USD/ton C02
Weighted Carbon Price (9/3/2021)
The price of carbon has increased by more than 500% in the past four years
(source: Carbon Price Index, IHS Market Ltd., as of September 3, 2021)
Demand for Carbon Credits is Rising
The Taskforce on Scaling Voluntary Carbon Markets (TSVCM), sponsored by the Institute of International Finance (IIF) with knowledge support from McKinsey, estimates that demand for carbon credits could increase by a factor of 15 or more by 2030 and by a factor of up to 100 by 2050. Overall, the market for carbon credits could be worth upward of $50 billion in 2030. (source: www.mckinsey.com)
Reduce Energy Waste and Monetize Your Carbon Credits with Kontrol
Kontrol Carbon Credit Process
The Growth in the Voluntary Offset Markets
The voluntary markets are those that are less regulated and not exclusive to large industry. The voluntary markets are accelerating due to a number of factors which have aligned at this point in time:
Corporate sustainability targets to achieve net zero emissions
Government incentives to reduce reliance on fossil fuels
Stakeholder engagement and shareholder activism
Customer demanding more transparency around GHG emissions
Voluntary Carbon Markets Rocket in 2021, On Track to Break $1B for First Time
A report from Ecosystem Marketplace on voluntary carbon markets finds 2021 is on track for annual market value record of $1 Billion+ for the first time, as all-time market value hits $6.7 Billion. Based on growing global network of 172 EM Respondents (13% increase from 2020 of 152), with traded credits from projects located in 80 countries.
The majority of large enterprises have internal teams that build carbon reduction plans across all facets of operations. However, there is not enough that can be done internally to get a full net zero emission target. This requires organizations to look outside their business and participate in the voluntary markets.
Organizations can purchase carbon credits as required to offset their carbon footprint. Examples include purchasing carbon credit offsets from large solar or wind farms built and maintained by third parties.
In most cases there is a developer of a carbon credit offset, a verification system, and a marketplace to trade. In the market place those who need carbon credits offsets to meet their sustainability or equivalent greenhouse gas reduction targets purchase from those who have developed them.
A New Carbon Credit Solution : Energy Conservation
Buildings are a major source of enormous untapped efficiency potential
Energy conservation, through technology, is the answer to reducing energy waste. Energy conservation can be achieved through increased efficient energy use, in conjunction with decreased energy consumption and/or reduced consumption from conventional energy sources.
Building and buildings construction sectors combined are responsible for over one-third of global final energy consumption and nearly 40% of total direct and indirect CO2 emissions
IEA.org
Energy conservation can result in increased financial capital, environmental quality, national security, personal security and human comfort. Energy consumers choose to conserve energy in order to reduce energy costs and promote economic sustainability. Industrial and commercial users can modify their consumption habits in order to promote more efficient consumption and to maximize their profits.
Energy conservation may also reduce the consumption of brown energy – energy generated through fossil fuel – and therefore contributes to the fight against climate change.
Converting Energy Conservation into Carbon Credits
Energy conversation technology installed in a building which creates reductions in energy consumption compared to a baseline scenario will also provide a corresponding GHG emission reduction.
Eligible project type
Each project that saves electricity (or achieves net reduction), is not mandatory and is in surplus of the prevailing practice for a specific vertical, is an admissible project. In Canada, projects such as energy conservation, building improvement, energy monitoring and control, and replacement of inefficient equipment by highly efficient products are deemed eligible projects.
Once verified, credits are generated on a yearly basis and registered, with type and date, with the verification registry, and can then be purchased.
Knowing that the money they spend on credits is directly helping decarbonization is giving corporations the confidence to enter the carbon credits market. In turn, knowing they have a powerful carbon reduction tool at their disposal increases their confidence in making net zero pledges.
What to look for?
Many standards focus on ensuring not just that the project is real but that it's:
Additional: the greenhouse gas reductions wouldn't have happened if they weren't funded by offsets.
Registered: it's important to make sure the project is registered with a carbon offset registry. That ensures offsets are only sold once and not double-counted.
Not subject to "leakage": that's where emission reductions in one area result in greater emissions somewhere else.
Benefit from our Carbon Credit Solutions
