Risk glossary

 

Carbon trading

Artificially created markets in human-generated carbon dioxide (CO2) emissions. By legislating permits for the emission of CO2 – issued in limited quantities and tradeable to exchange surplus and shortfalls in permits – a cap and trade regime is created, aimed at placing an economic cost on carbon emissions.

* see also carbon dioxide (CO2); European Emissions Allowances (EUA); Certified Emission Reduction (CER)

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