Q. With reference to Carbon Markets, consider the following statements;
1.Carbon markets allow the trade of carbon credits with the overall objective of bringing down emissions.
2.Carbon markets will work only at the international level.
Which of the statements given above is/are correct?
Answer: A
Notes:
Statement 1 is correct: Carbon markets allow the trade of carbon credits with the overall objective of bringing down emissions. These markets create incentives to reduce emissions or improve energy efficiency.
Statement 2 is incorrect: They exist at national level also. For example,
Europe: There is an emission trading scheme (ETS) in Europe. Under this, industrial units in Europe have prescribed emission standards to adhere to and they buy and sell credits based on their performance.
India: There is a scheme called PAT(or perform, achieve and trade). It allows units to earn efficiency certificates if they outperform the prescribed efficiency standards. The laggards can buy these certificates to continue operating.
Source: Indian Express
