ESG Insider: A podcast from S&P Global cover image

ESG Insider: A podcast from S&P Global

Exploring the role of carbon markets in reaching climate targets

Aug 16, 2024
28:30
Snipd AI
Roman Kramarchuk, Head of Climate Strategies at a leading environmental solutions firm, dives into the world of carbon markets. He discusses the significant growth of these markets, now covering a quarter of global emissions. The conversation highlights the differences between voluntary and compliance markets and their roles in achieving decarbonization targets. Kramarchuk also tackles the political dynamics affecting carbon trading and emphasizes the importance of high-quality credits for sustainable practices in both developed and developing economies.
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Podcast summary created with Snipd AI

Quick takeaways

  • Carbon markets, crucial for global decarbonization, are categorized into compliance and voluntary types, each with distinct dynamics and regulations.
  • Recent geopolitical events have undermined confidence in voluntary carbon markets, highlighting challenges related to credit quality and verification processes.

Deep dives

Understanding Carbon Markets

Carbon markets are critical tools for achieving global decarbonization goals by allowing companies and governments to trade carbon allowances. There are two primary types of carbon markets: compliance markets, which are regulated and mandated by governments, and voluntary markets, where organizations take initiative to offset their emissions without government requirements. Compliance markets are larger in scale, with a collective value nearing a trillion dollars, while voluntary markets are significantly smaller, operating in the low single-digit billions. This framework enables entities to leverage market dynamics to reduce emissions cost-effectively instead of adhering to rigid regulations.

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