Carbon Credits: An Overview

I. INTRODUCTION

Greenhouse Gases ("GHGs") emissions as a result of human activity have had a most catastrophic impact on climate change and global warming since the mid – 20^th century.¹ As per an analysis conducted by the International Energy Agency ("IEA"), carbon dioxide emissions rose by 6% in 2021 to 36.3 billion tonnes, marking the highest peak point, as the world economy rebounded from the Covid-19 crisis.²

Countries worldwide have been discussing ways to combat climate change since the early 1990s³. These discussions have led to the implementation of various important accords, including the Kyoto Protocol and the Paris Agreement. One of the major concerns faced by several countries, more specifically developing countries, while committing to sustainability goals is the impact it might have on their overall economy owing to the adoption of expensive cleaner technologies in every industry. To address this problem, both Kyoto Protocol and Paris Agreement