Process improvements can reduce carbon dioxide (CO2) air emissions. When that is done there can be left over, permitted CO2 air emissions that can be sold to other users. In doing so, a certain percentage of the original CO2 emissions are eliminated and cannot be sold. Hence a reduction in permitted CO2 air emissions overall.
Hungary last week carried out the first sale of certified emissions reductions (CERs) which Hungarian companies had already used to offset against their emissions in the European Union’s emissions trading scheme. These emission offsets are sold internationally to other companies.
Under the Kyoto Protocol, countries were granted a certain number of permits to release greenhouse gases into the atmosphere, called Assigned Amount Units (AAUs), which are equivalent to one ton of CO2 and are roughly equivalent to a CER.
The Protocol was originally signed in 1997 and went into full effect in 2005. The Protocol is intended to help reduce greenhouse gas emissions, such as CO2, and stabilize any potential climate change effects. Currently there are 187 countries that have ratified the Protocol.
Certain countries have a surplus of these AAU’s, partially due to much older or obsolete technology that was retired.