Carbon Credits

South Central Railway has set up a Biodiesel Online Blending Facility at Railway Consumer Depot, Kacheguda and Water Recycling Plant at Railway Colony, Kacheguda in Hyderabad. Its GM Ravindra Gupta said that the installation of Biodiesel Online Blending Facility will gradually bring down the dependency of Indian Railways and the Nation on fossil fuel.

Further it will also entail a substantial reduction in Foreign exchange spent on procuring HSD oil. This will also have the added benefit of earning huge carbon credits to the Railways since use of bio-diesel as alternate fuel will reduce corresponding amount of carbon footprint. This innovation will not only give a big boost to the Indian economy but also will result in cleaner environment.

Scientific consensus states that carbon emissions must be reduced by 80% by 2050 to avoid temperature rise of more than 2 degree celsius. Carbon offsetting is the use of carbon credits to enable businesses to compensate for their emissions, meet their carbon reduction goals and support the move to a low carbon economy A carbon credit is a financial instrument that allows the holder, usually an energy company, to emit one tonne of carbon dioxide.

Credits are awarded to countries or groups that have reduced their greenhouse gases below their emission quota. Carbon credits can be legally traded in the international market. A carbon credit, then, is essentially a permit that allows the receiver to burn a specified amount of hydrocarbon fuel over a specified period of time.

Carbon credits are a highly regulated medium of exchange used to 'offset', or neutralise, carbon dioxide emissions. In the voluntary carbon offset market, individuals and businesses purchase carbon credits on a voluntary basis in order to lower their carbon footprint, or the total amount of carbon emissions that result from their activities.

Emissions trading, as set out in Article 17 of the Kyoto Protocol, allows countries that have emission units to spare - emissions permitted them but not "used" - to sell this excess capacity to countries that are over their targets. Thus, a new commodity was created in the form of emission reductions or removals. Since carbon dioxide is the principal greenhouse gas, people speak simply of trading in carbon. Carbon is now tracked and traded like any other commodity. This is known as the "carbon market."