How Are Carbon Credits Issued?

It’s not clear to many how carbon credits come into existence. They don’t just ‘pop up’ in the way central banks increase the currency supply. In reality the process involves a complex series of steps, from a project proposal document, through to validation, monitoring, reporting and verification, and final issuance by a carbon standards group. In this Carbonwise Visual Learning asset, we help set out the sequence of steps needed to create a carbon credit.

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LATEST VISUAL LEARNING

This chart shows the total amount of man-made emissions created by the world's biggest polluters.
The amount of atmospheric CO2 has charted a steady climb higher. The Mauna Loa Observatory on the north flank of volcano of the same name
A mechanism deployed under the EU Emissions Trading System to remove a volume of carbon allowances from circulation in the market.
In order to ensure the global reduction in GHG emissions, carbon reductions need to be permanent. Permanence is considered when approving a carbon offset project
On 17th July, the European Commission unveiled its much-anticipated legislative proposal to overhaul the EU’s compliance carbon market, the EU Emissions Trading System (EU ETS).

2 September 2026

GLOSSARY
Market Stability Reserve

A mechanism deployed under the EU Emissions Trading System to remove a volume of carbon allowances from circulation in the market.

27 August 2026

GLOSSARY
Permanence

In order to ensure the global reduction in GHG emissions, carbon reductions need to be permanent. Permanence is considered when approving a carbon offset project such as avoided deforestation.

27 July 2026

HIGHLIGHT
EC seeks to overhaul EU’s compliance carbon market with proposed new laws

On 17th July, the European Commission unveiled its much-anticipated legislative proposal to overhaul the EU’s compliance carbon market, the EU Emissions Trading System (EU ETS).

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