Understanding Carbon Credits

Crediting Project Actors

Designing, implementing, and operating carbon crediting projects requires the involvement of a number of parties, stakeholders and authorities. Although the parties involved differ from project to project, some general categories and types of market players can be defined as follows.

Project Owners

The operator and owner of the physical project installation where the crediting project takes place. An owner can be any private person, company or other organization.

Project Developers

A person or organization with the intention to develop a crediting project. This could be the project owner, a consultant or specialized services provider.

Project Funders

Banks, private equity firms, private investors, non-profit organizations and other organizations may lend or invest equity to fund a project.

Stakeholders

Individuals and organizations that are directly or indirectly affected by the crediting project. Stakeholders include the parties interested in developing a specific project (e.g., owner, developer, funder), parties affected by the project (e.g., local population, host community, environmental and human rights advocates) and national and international authorities.

Third Party Auditors – Validators and Verifiers

Almost all crediting programs require a third-party auditor to validate and verify a project’s baseline and its projected and achieved avoided emissions and/or enhanced removals. Most crediting programs have processes for accrediting their third party auditors before they are approved to conduct validation and verification activities. Typically included in this process, most programs develop requirements that auditors must fulfill to reduce the risk of conflict of interest.

Standards Organizations

In the absence of national or international legislation, non-governmental standard organizations define a set of rules and criteria for voluntary carbon credits.

For terms related to Carbon Market Actors visit this related page:

Mandatory & Voluntary Carbon Credit Markets