Common carbon credit standards/mechanisms currently applied

For carbon credits to be considered credible and tradable on the global market, they must be developed, verified, and issued under a recognized standard or program. These frameworks provide the rules, methodologies, and registry systems that ensure the integrity of the credits. The most prominent standards include:

The Clean Development Mechanism (CDM)

Established under the Kyoto Protocol, the Clean Development Mechanism (CDM) was a pioneering framework that allowed emission-reduction projects in developing countries to earn Certified Emission Reduction (CER) credits. Each CER represents one ton of CO₂ equivalent. These credits could then be purchased and used by industrialized nations to help meet their binding emission reduction targets. The mechanism was designed not only to provide compliance flexibility for developed countries but also to promote sustainable development and finance clean energy projects in developing nations.16

The Verified Carbon Standard (VCS) Program

Managed by the non-profit organization Verra, the Verified Carbon Standard (VCS) is the world's most widely used voluntary greenhouse gas crediting program. It drives finance toward a diverse range of activities that reduce and remove emissions, improve livelihoods, and protect nature. Projects developed under the VCS Program are rigorously assessed against a set of robust requirements and methodologies, generating credits known as Verified Carbon Units (VCUs). The program's integrity is globally recognized, and it is endorsed by the International Carbon Reduction and Offset Alliance (ICROA) for adhering to its Code of Best Practice.17

The Gold Standard for the Global Goals

The Gold Standard is another leading standard in the voluntary carbon market, renowned for its stringent requirements for both environmental integrity and sustainable development. Established in 2003 by the World Wide Fund for Nature (WWF) and other international NGOs, the Gold Standard requires projects not only to demonstrate verifiable emission reductions but also to deliver tangible benefits to local communities and ecosystems. To be certified, a project must contribute to at least three of the UN's Sustainable Development Goals (SDGs), ensuring a positive and holistic impact beyond just climate mitigation.18

References

16. United Nations Framework Convention on Climate Change. (n.d.). The Clean Development Mechanism. UNFCCC. https://cdm.unfccc.int/about/index.html
17. Verra. (n.d.). Verified Carbon Standard. Verra. https://verra.org/programs/verified-carbon-standard/
18. The Gold Standard. (n.d.). Gold Standard for the Global Goals. Gold Standard for the Global Goals. https://www.goldstandard.org/