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Download the report to discover more about carbon credits and the critical role they play in transitioning to a low-carbon economy.
In brief
- Carbon credits are tradable permits that represent the reduction or removal of one metric ton of CO₂ or equivalent greenhouse gases, enabling organizations to offset emissions and invest in climate-positive projects toward global net-zero goals.
- In the timber industry, carbon credits reflect the economic value of sustainable forest practices that capture or avoid CO₂ emissions.
- Some of the main forestry-based carbon projects include: afforestation and reforestation, improved forest management, reducing emissions from deforestation and forest degradation+ (REDD+), and biochar and timber residues.
- Nature-based carbon projects in the timber industry offer significant revenue potential by generating and selling carbon credits from sustainable forest management, but their profitability is not guaranteed.
Many organizations around the world are concerned about their decarbonization strategies. Carbon credits have emerged as a key mechanism to support the transition to a low-carbon economy. Beyond their environmental value, carbon credits represent an important financial and reputational consideration for companies seeking to demonstrate credible progress toward net zero.
The EY Luxembourg Carbon Credit Report provides a technical overview of the carbon credit landscape, including but not limited to, the nature and classification of credits, the development of forestry-based carbon projects, the evolving regulatory environment, and the accounting and auditing considerations that underpin transparency and integrity. It also explores the role of assurance in building trust and credibility across the carbon markets.
As markets mature and scrutiny intensifies, robust governance, accurate reporting, and independent assurance are essential to ensure that carbon credits deliver genuine environmental outcomes and stand up to stakeholder expectations. Now is the right moment for companies to evaluate how carbon credits fit within their broader sustainability strategies.
Summary
The EY Luxembourg Carbon Credit Report provides a technical overview of the carbon credit landscape, including but not limited to, the nature and classification of credits, the development of forestry-based carbon projects, the evolving regulatory environment, and the accounting and auditing considerations that underpin transparency and integrity. It also explores the role of assurance in building trust and credibility across the carbon markets.
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