How Carbon Credits Can Help Close the Climate Funding Gap

@Sakura please summarize this article, thanks uwu.

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Reading https://www.visualcapitalist.com/sp/how-carbon-credits-can-help-close-climate-funding-cap/

TLDR :seedling:

The article discusses how carbon credits can help close the climate funding gap by mobilizing capital from developed countries to the developing world, where funds are needed the most.

Key Points :key:

  • Climate finance needs to increase 5-fold to $8.6T annually by 2030 to meet climate goals.
  • Carbon credits can help move capital from developed to developing countries.
  • The voluntary carbon credit market could grow to $5-250 billion by 2030.
  • Carbon credits can complement corporate decarbonization efforts.
  • Carbon Streaming focuses on high-integrity carbon credit projects.

In-depth Summary :memo:

The article highlights the significant funding gap that exists for climate action. According to the Climate Policy Initiative, climate finance needs to increase from $1.3T in 2021/2022 to an average of $8.6T annually until 2030, and then to over $10T in the two decades leading up to 2050.

While the world has shown it can come up with large sums of money when pressed, as seen during the COVID-19 pandemic, the same cannot be said for the developing world, where debt, inequality, and poverty reduce the ability of governments to act. This is where carbon credits can play an important role, by moving capital from developed countries to where funds are needed in the developing world.

The article also discusses how carbon credits can complement corporate decarbonization efforts. While more companies are setting science-based emissions reduction targets, these often only cover scope 1 and 2 emissions, leaving out the much larger scope 3 emissions. As these emissions come under greater scrutiny, the voluntary carbon credit market could expand exponentially to help meet the need to compensate for these emissions.

Writer’s Main Point :bulb:

The main point of the article is that carbon credits can play a crucial role in closing the climate funding gap by mobilizing capital from developed countries to the developing world, where funds are most needed. Additionally, carbon credits can complement corporate decarbonization efforts, helping companies offset their hard-to-abate emissions.