Carbon Credit: An Important Tool for Climate Change Mitigation and Sustainable Agriculture Future

Abstract

Climate change impacts cause economic and social losses to different dimensions of the humans and environment directly and indirectly. Greenhouse Gases (GHGs) emission is the major factor responsible for climate change over the earth's surface. Since the evidence of increased mercury levels, sincere efforts have been taken at national and international levels to combat the emissions with a focus on sustainable development. One way to do this is to switch to green technologies and promote the use of renewable energy, carbon sequestration, etc. The Kyoto Protocol in 1997 served as a milestone in the inception of the carbon market where carbon credits are bought and sold. Carbon credit can be defined as a tradeable certificate or permit representing the right to emit carbon or carbon dioxide equivalent. An entity producing carbon more than the permissible limit can purchase carbon credit from another entity which is involved in practices that deal with carbon removal or reduce carbon emission. Carbon credit has been used as an effective tool to combat climate change through its incentive to promote green technologies i.e. mitigation efforts. Generation and accounting of carbon credit is being done in sectors like agriculture, forest, automobiles, waste management, dairy sector etc. In agriculture sector, the use of innovative solutions, cap and trade systems are some of the ways of generating carbon credits. Carbon financing helps fight climate change by encouraging projects that reduce emissions. The major challenge that is faced in this, is the system of accounting of credits. There are existing methodologies for calculating the credit generated but yet there is need of upgrading, development of new ways of capturing the emissions reduced. This is due to leakages in the systems, inconsistency of accounting and sometime immature closure of the projects. Advances in research can provide better accounting and tracking methods that will make carbon credit one of the robust tool for tackling climate change. © 2025 The Editor(s) (if applicable) and The Author(s), under exclusive license to Springer Nature Switzerland AG.