Carbon Credits for Business: How to Buy, Trade, and Offset Your Carbon Footprint in 2026

A $1.22 trillion market. That is the projected size of the global carbon credit market in 2026, according to BloombergNEF and McKinsey estimates. By 2035, that figure is expected to balloon to $4.9 trillion. Whether those numbers excite you or make your head spin, the practical reality is the same: carbon credits are no longer a niche instrument traded between power plants and hedge funds. They are a mainstream business tool, and the companies that learn to use them well are going to have a measurable edge in cost management, regulatory readiness, and brand positioning. The Integrity Council for the Voluntary Carbon Market (ICVCM) issued its Core Carbon Principles in 2023 — the first globally recognized quality benchmark for voluntary credits — marking a watershed moment that is already reshaping which credits buyers accept and which they reject as inadequate.

But here is the thing most guides will not tell you: buying carbon credits is easy. Buying the right carbon credits, at a fair price, from a reputable source, and accounting for them properly in your ESG reports, is where most businesses stumble. I have watched companies spend six figures on credits that later turned out to be worthless because the underlying project was not additional. I have seen small businesses overpay by 400 percent because they did not understand the difference between avoidance and removal credits. And I have seen smart mid-market companies turn their carbon credit strategy into a genuine competitive advantage.

This guide is designed to make you one of the smart ones. We will walk through exactly how carbon credits work, what they cost in 2026, where to buy them, how to evaluate quality, and how they fit into both your carbon footprint accounting and your tax strategy.

What Are Carbon Credits and How Do They Work?

A carbon credit is a tradeable certificate representing one metric tonne of carbon dioxide equivalent (tCO2e) that has been either prevented from entering the atmosphere or actively removed from it. When a business buys and retires a carbon credit, it offsets one tonne of its own emissions. Credits are issued by independent registries that verify the underlying emission reduction or removal project.

The mechanics are straightforward, even if the ecosystem around them has gotten complicated. A project developer, say a company building a wind farm in India or restoring a mangrove forest in Colombia, demonstrates that their project reduces or removes greenhouse gas emissions compared to a baseline scenario. An independent third-party auditor verifies the claim. A registry like Verra or Gold Standard then issues serialized credits, each with a unique identifier, that can be sold on the open market.

When you buy that credit, you own the right to claim that one tonne of emission reduction. When you retire it (which means permanently removing it from circulation), you can apply it against your company's emissions inventory. A retired credit cannot be resold or re-used. That retirement is what turns a carbon credit into a carbon offset.

Credits come in two fundamental categories:

• Avoidance credits: These represent emissions that would have occurred but did not, thanks to the project. A solar farm that displaces coal-fired electricity generates avoidance credits. A cookstove project that reduces wood burning in rural communities generates avoidance credits. The emissions were prevented, not removed.
• Removal credits: These represent CO2 that was actively pulled out of the atmosphere. Reforestation projects, soil carbon sequestration, biochar, and direct air capture (DAC) all generate removal credits. The atmosphere has less CO2 in it because of the project.

This distinction matters enormously for pricing, quality perception, and how your credits are viewed by stakeholders. Removal credits are generally considered higher quality and command significantly higher prices. More on that in the pricing section below.

Compliance vs. Voluntary Carbon Markets: Key Differences

The compliance carbon market is a government-regulated system where companies that exceed emission caps must purchase allowances or face penalties. The voluntary carbon market is where businesses buy credits by choice to meet internal sustainability goals, customer expectations, or supply chain requirements. They operate under different rules, different pricing, and different oversight structures.

The compliance market is the heavyweight. The EU Emissions Trading System (EU ETS), California's cap-and-trade program, China's national ETS, and the UK ETS are the major compliance systems operating in 2026. Together, they cover roughly 17 percent of global greenhouse gas emissions. If your business is a power plant, a steel manufacturer, or an airline operating in the EU, you are in a compliance market whether you like it or not. You receive or buy allowances, and if your emissions exceed your allowances, you pay steep penalties, often 100 euros or more per tonne.

The voluntary carbon market (VCM) is the Wild West by comparison, though it is growing up fast. There is no government mandate to participate. Companies buy voluntary credits because they have set net-zero targets, because their customers demand it, because their B2B buyers require it in procurement contracts, or because they want to get ahead of regulations that are clearly coming. The VCM was valued at roughly $1.7 billion in 2025, a fraction of the compliance market but growing at 20 to 30 percent annually. Microsoft's carbon removal strategy — which committed to purchasing 1.5 million tonnes of high-quality removal credits in 2024 alone, including contracts with Climeworks for direct air capture and with reforestation project developers — represents the leading corporate model for how large buyers are using the voluntary market to complement internal reduction programs.

Key differences to understand:

For most small and mid-market businesses, the voluntary market is where you will operate. But keep an eye on compliance markets, because the trend is unmistakably toward broader coverage. The EU's Carbon Border Adjustment Mechanism (CBAM) is already forcing non-EU exporters to account for their carbon costs. Similar mechanisms are being discussed in the US, UK, and Canada. Understanding compliance risk management now will save you scrambling later.

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Carbon Credit Prices in 2026: What to Expect

Carbon credit prices in 2026 range from under $5 per tonne for basic avoidance credits to over $500 per tonne for premium technology-based removal credits. The average voluntary market transaction price sits around $8 to $12 per tonne, but that average obscures massive variation based on credit type, project quality, vintage, and co-benefits.

Let me break this down by category, because quoting a single "price of carbon" is about as useful as quoting the "price of a car." It depends entirely on what you are buying.

Avoidance credits (renewable energy, cookstoves, methane capture): These are the cheapest credits on the market, typically trading at $2 to $8 per tonne. Renewable energy credits from large wind and solar projects in developing countries have dropped below $5 in many cases because the projects are now economically viable without carbon finance, which raises serious questions about additionality. Cookstove credits and methane destruction credits tend to hold value better at $5 to $12 because the projects genuinely depend on carbon revenue.

Nature-based removal credits (reforestation, afforestation, mangrove restoration, soil carbon): These trade in the $15 to $35 per tonne range for projects with strong verification and co-benefits. High-integrity reforestation projects with biodiversity monitoring and community development components command the upper end. Projects registered with Gold Standard tend to price 10 to 20 percent higher than equivalent Verra VCS credits because Gold Standard's certification process is more demanding on social and environmental co-benefits.

Technology-based removal credits (direct air capture, enhanced weathering, biochar): This is where prices get serious. Direct air capture credits from companies like Climeworks, Carbon Engineering, and Heirloom range from $250 to $500+ per tonne. Enhanced rock weathering credits sit around $150 to $250. Biochar credits range from $100 to $200. These prices reflect the actual cost of physically pulling CO2 out of the atmosphere with engineered systems, which is expensive but highly verifiable and permanent.

Compliance market allowances: EU ETS allowances trade around $65 to $85 per tonne in early 2026. California cap-and-trade allowances sit around $35 to $45. China's national ETS, still in its early years, prices allowances at $10 to $15 but is expected to rise significantly as the system matures.

The pricing trend is clear: cheap, low-quality avoidance credits are being squeezed out of the market as buyers become more sophisticated and integrity standards tighten. If you are buying credits purely on price, you are probably buying credits that will not hold up to scrutiny when your customers, investors, or regulators take a closer look.

How to Buy Carbon Credits for Your Business

Buying carbon credits involves four steps: calculating your emissions footprint, choosing the right credit type for your strategy, selecting a reputable broker or marketplace, and properly retiring and recording the credits. Most businesses can complete their first purchase within two to four weeks.

Step 1: Know your emissions. You cannot offset what you have not measured. Before you buy a single credit, you need at least a basic greenhouse gas inventory. This means calculating your Scope 1 emissions (direct emissions from company-owned sources like vehicles and furnaces), Scope 2 emissions (indirect emissions from purchased electricity and heating), and ideally an estimate of your Scope 3 emissions (supply chain, business travel, employee commuting). Our guide on reducing your carbon footprint covers the measurement process in detail.

Step 2: Reduce first, then offset. This is not just good ethics; it is increasingly a requirement. The Science Based Targets initiative (SBTi) and most credible frameworks require companies to demonstrate genuine emission reductions before using offsets for residual emissions. If you skip straight to buying credits without reducing your operational emissions through renewable energy, efficiency improvements, and supply chain optimization, your offset claims will be challenged.

Step 3: Choose your credit type. Your choice should align with your sustainability narrative and budget. A company claiming carbon neutrality can use a mix of avoidance and removal credits for residual emissions. A company targeting net-zero will need an increasing proportion of removal credits over time. A company focused on regulatory readiness should prioritize credits that are CORSIA-eligible or aligned with Article 6 of the Paris Agreement.

Step 4: Select your purchasing channel. You have several options:

• Direct from project developers: Best prices, but requires due diligence and typically larger minimum purchases ($10,000+). Good for companies buying 1,000+ tonnes annually.
• Carbon credit marketplaces: Platforms like Xpansiv CBL, Toucan, and Climate Impact X aggregate credits from multiple projects. You can browse, compare, and buy with lower minimums. Transaction fees typically range from 5 to 15 percent.
• Specialized brokers: Companies like South Pole, 3Degrees, and Natural Capital Partners handle sourcing, due diligence, and retirement for you. They charge a premium (often 20 to 40 percent above wholesale) but provide expertise and risk management. Best for companies that want a hands-off approach.
• Retail platforms: For small purchases (under $5,000), platforms like Patch, Cloverly, and Wren offer user-friendly interfaces with curated project portfolios. Prices are marked up from wholesale, but the convenience is worth it for small businesses.

Step 5: Retire and record. Once you purchase credits, you must retire them on the registry to claim the offset. This means the credit serial numbers are permanently canceled so they cannot be resold. Keep records of retirement certificates, as you will need them for ESG reporting and any carbon neutrality claims. Most registries provide public retirement records that can be verified by third parties.

Top Carbon Credit Providers and Registries

The three dominant registries in the voluntary carbon market are Verra (Verified Carbon Standard), Gold Standard, and the American Carbon Registry. Each has different strengths, methodologies, and reputations. Choosing the right registry is not about picking the cheapest option; it is about matching registry credibility to your stakeholders' expectations.

Verra (Verified Carbon Standard / VCS) is the largest voluntary market registry by volume, accounting for roughly 65 to 70 percent of all voluntary credits issued globally. Verra covers the broadest range of project types: REDD+ (avoiding deforestation), renewable energy, methane reduction, agriculture, and more. They launched updated methodologies in 2024 and 2025 to address criticisms about the accuracy of their REDD+ baseline calculations. If you are buying nature-based credits, Verra is likely where they originate. Strengths: scale, breadth of methodologies, widespread market acceptance. Weaknesses: has faced scrutiny over REDD+ credit quality, though recent reforms have addressed many concerns.

Gold Standard was founded by WWF and has positioned itself as the premium registry with the strictest co-benefit requirements. Every Gold Standard project must demonstrate contributions to at least three UN Sustainable Development Goals beyond climate. Their certification process is more rigorous and more expensive for project developers, which means fewer total credits but generally higher quality and stakeholder confidence. Strengths: highest perceived quality, strong co-benefit verification, SDG alignment. Weaknesses: smaller project pipeline, higher prices, fewer credit types available.

American Carbon Registry (ACR) is the oldest voluntary registry, now part of Winrock International. ACR has a strong position in US-based projects, particularly in forestry, grasslands, and industrial gas destruction. Their methodologies are well-established and widely accepted by US buyers and regulators. ACR credits are also eligible under California's compliance market, which gives them an additional layer of credibility. Strengths: US market credibility, CORSIA eligibility, compliance market crossover. Weaknesses: less international coverage than Verra or Gold Standard.

Other registries worth knowing about include:

• Climate Action Reserve (CAR): Another US-focused registry with strong forestry and livestock methane methodologies. Credits are accepted under California's cap-and-trade program.
• Puro.earth: Specializes exclusively in carbon removal credits. If you are specifically buying engineered or nature-based removals, Puro's focus makes their verification process particularly thorough for those project types.
• Isometric: A newer registry focused on durable carbon removal, backed by Stripe Climate. They apply a scientific peer-review process to credit verification that is more transparent than traditional registry approaches.

High-Quality vs. Low-Quality Credits: The Integrity Framework

A high-quality carbon credit meets the Core Carbon Principles established by the Integrity Council for the Voluntary Carbon Market (ICVCM): additionality, permanence, no double counting, conservative quantification, and no net harm. Low-quality credits fail one or more of these tests, and buying them exposes your business to greenwashing accusations and stranded assets.

Let me be blunt: the voluntary carbon market has a quality problem that is being aggressively addressed in 2026 but is far from solved. Studies published in 2023 and 2024 found that a significant percentage of REDD+ credits did not represent real emission reductions because the deforestation baselines were inflated. Renewable energy credits from projects that would have been built anyway (not additional) have flooded the market with cheap credits that do not move the needle on actual emissions.

Here is how to evaluate credit quality:

Additionality: This is the most important and most contested quality criterion. A credit is additional if the emission reduction or removal would not have happened without the carbon finance incentive. A solar farm in Germany that receives generous feed-in tariffs and would have been built regardless is not additional. A cookstove distribution project in rural Kenya that depends entirely on carbon credit revenue to cover costs is additional. Ask your seller: "What evidence demonstrates that this project depends on carbon credit revenue?"

Permanence: For removal credits, how long does the carbon stay removed? A forest can burn down. Soil carbon can be released if farming practices change. Direct air capture stored in geological formations is essentially permanent. The standard benchmark is 100 years of storage, with buffer pools (reserved credits that cover reversals) for nature-based projects. Technology-based removals with geological storage offer the strongest permanence guarantees.

No double counting: Under Article 6 of the Paris Agreement, the same emission reduction cannot be claimed by both the project host country and the credit buyer's country. This requires "corresponding adjustments" to national emissions inventories. Credits without corresponding adjustments may be used by both the buyer and the host country to meet their climate targets, which defeats the purpose. This issue is particularly relevant for companies making net-zero claims and for credits used under CORSIA.

Conservative quantification: The emission reduction calculation should use conservative assumptions and be verified by an accredited third-party auditor. Overcounting is the most common quantification failure, particularly in forestry projects where measuring carbon stocks involves significant uncertainty.

No net harm: The project should not cause environmental damage (like monoculture plantations replacing biodiverse grasslands) or social harm (like displacing indigenous communities). Gold Standard's SDG certification provides the strongest assurance on this criterion.

The ICVCM's Core Carbon Principles (CCPs) label, which began rolling out in 2024, is becoming the market standard for signaling credit quality. Credits that carry the CCP label have been assessed against all five criteria above. If you want a simple quality filter, start by asking whether the credits you are considering are CCP-eligible.

Carbon Credits and ESG Reporting: How They Intersect

Carbon credits play a specific and limited role in ESG reporting frameworks. Under the GHG Protocol, ISSB standards, and the EU's Corporate Sustainability Reporting Directive, purchased carbon credits cannot be subtracted from your Scope 1, 2, or 3 emissions totals. They must be reported separately as offsets, alongside your gross emission figures.

This is a point that trips up a lot of companies, so let me be clear: buying carbon credits does not reduce your reported emissions. It provides a separate claim that you have compensated for some or all of those emissions. Your ESG report must show your gross emissions (before offsets) and then separately disclose how many offsets you have retired, what type they are, and which registry issued them.

The major reporting frameworks handle carbon credits as follows:

GHG Protocol: The world's most widely used greenhouse gas accounting standard. Carbon credits are reported in a separate "offsets" category. The GHG Protocol's updated Scope 2 and Scope 3 guidance reinforces that offsets do not change your emissions calculations but can be reported alongside them to demonstrate climate action beyond your value chain.

ISSB (IFRS S2): The International Sustainability Standards Board's climate disclosure standard, which became mandatory in several jurisdictions in 2025, requires companies to disclose their use of carbon credits separately from their emission reduction strategies. Companies must specify the type of credit (avoidance vs. removal), the registry, and whether the credits are verified.

EU CSRD / European Sustainability Reporting Standards (ESRS): The CSRD, which applies to companies operating in the EU with more than 250 employees, requires detailed disclosure of carbon credit usage, including the amount spent, the credit types, and the proportion of total emissions they represent.

SBTi Net-Zero Standard: The Science Based Targets initiative allows carbon credits (specifically removals) only for neutralizing residual emissions after achieving at least 90 percent reduction from a base year. Avoidance credits do not count toward net-zero under SBTi, though they can be used for interim targets as "beyond value chain mitigation."

The practical takeaway: document everything. Keep retirement certificates, registry transaction records, and project documentation. As ESG reporting requirements tighten globally, the businesses that have clean records will spend less time and money on compliance. For a complete walkthrough of how to handle this, see our ESG reporting guide.

Article 6 of the Paris Agreement: What It Means for Business

Article 6 of the Paris Agreement establishes the international rules for carbon market cooperation between countries, including how credits can be transferred across borders without double counting. For businesses, Article 6 determines whether the credits you buy will be recognized under future international carbon accounting rules or risk becoming obsolete.

After nearly a decade of negotiations, the Article 6 rulebook was finalized at COP26 in Glasgow and refined at COP27 and COP28. It creates two main mechanisms:

Article 6.2 (bilateral cooperation): Allows countries to trade emission reductions directly with each other through "Internationally Transferred Mitigation Outcomes" (ITMOs). When a credit is transferred under Article 6.2, the selling country must make a "corresponding adjustment" to its national emissions inventory, adding the transferred tonnes back to its own ledger. This prevents double counting at the national level.

Article 6.4 (centralized mechanism): Establishes a UN-supervised crediting mechanism, sometimes called the "Article 6.4 mechanism" or informally the successor to the Clean Development Mechanism (CDM). This creates a standardized process for project approval, credit issuance, and corresponding adjustments. The Article 6.4 Supervisory Body adopted its initial methodological guidance in 2024 and began accepting project applications in 2025.

Why should businesses care? Because the corresponding adjustment requirement is reshaping the voluntary market. Credits that come with corresponding adjustments, meaning the host country has agreed to adjust its national inventory, are increasingly seen as the gold standard for corporate net-zero claims. Credits without corresponding adjustments can still be purchased, but their value for making climate claims is diminished because the same reduction may also be counted by the host country toward its Nationally Determined Contribution (NDC).

The practical implication: when buying credits in 2026, ask your supplier whether the credits carry Article 6-compliant corresponding adjustments. Not all credits do, and not all situations require them, but for companies making public net-zero claims or operating in jurisdictions with emerging carbon border mechanisms, this distinction is becoming critical for financial risk management.

How to Build a Carbon Offset Strategy

An effective carbon offset strategy follows a hierarchy: measure your footprint, reduce emissions through operational changes, switch to clean energy for remaining energy needs, and only then offset residual emissions with high-quality credits. Skipping any of these steps undermines the credibility of your entire climate commitment.

Here is a practical framework for building your strategy in 2026:

Phase 1: Baseline and measure (Months 1-2). Commission or conduct a greenhouse gas inventory covering Scope 1, 2, and at minimum a screening of material Scope 3 categories. Use the GHG Protocol Corporate Standard as your framework. Free tools from the EPA, Carbon Trust, and Watershed can help small businesses get started without hiring a consultant. The goal is a defensible emissions number, not a perfect one. You can refine the methodology over time.

Phase 2: Reduce what you can (Months 2-6). Before spending a dollar on credits, identify and implement emission reductions within your operations. Switch to renewable energy for your electricity, either through on-site solar installations or renewable energy certificates. Optimize logistics and business travel. Engage key suppliers on their own emission reductions. Our detailed guide on how to reduce your carbon footprint covers the full range of reduction levers available to businesses. The reductions you make here are permanent, free of integrity risk, and demonstrate genuine commitment.

Phase 3: Define your offset scope (Month 6). Decide what you are offsetting and to what standard. Options include:

• Carbon neutral: Offsetting 100 percent of Scope 1 and Scope 2 emissions, typically using a mix of avoidance and removal credits. This is the most common claim for mid-market businesses.
• Climate positive / carbon negative: Offsetting more than 100 percent of emissions. Requires purchasing removal credits beyond your total footprint.
• Net-zero aligned: Following SBTi or equivalent framework requiring 90+ percent actual reductions and removal-only offsets for residual emissions. The highest bar and the most credible long-term commitment.

Phase 4: Build your credit portfolio (Months 6-8). Diversify across project types, geographies, and registries. A strong portfolio might include 50 percent nature-based removals (reforestation, mangrove restoration), 30 percent high-quality avoidance credits (methane capture, clean cooking), and 20 percent technology-based removals (direct air capture, biochar). This diversification manages permanence risk, price risk, and integrity risk across your portfolio.

Phase 5: Retire, report, and refine (Ongoing). Retire credits annually against your audited emissions. Disclose your offset strategy in your sustainability report. Review and adjust annually as your emissions profile changes, credit prices shift, and quality standards evolve. Increase the proportion of removal credits in your portfolio each year as you move toward a net-zero trajectory. The companies that invest in distributed renewable energy and operational efficiency find their residual emissions shrinking year over year, reducing both their offset costs and their exposure to credit price volatility.

Tax Benefits and Incentives for Carbon Credits

In most jurisdictions, carbon credit purchases qualify as deductible business expenses, and specific tax credits like the US 45Q provide direct incentives of up to $85 per tonne for carbon capture and sequestration. The tax treatment varies significantly by country, credit type, and whether the purchase is voluntary or compliance-driven.

United States: The Inflation Reduction Act of 2022 supercharged carbon-related tax incentives, and most provisions are still in effect in 2026. The 45Q tax credit offers $85 per tonne for direct air capture with geological storage and $60 per tonne for point-source carbon capture. For businesses purchasing voluntary credits (rather than capturing carbon themselves), the cost is generally deductible as an ordinary business expense under Section 162 of the Internal Revenue Code, provided the purchase serves a legitimate business purpose such as meeting contractual sustainability commitments, regulatory requirements, or documented strategic objectives.

European Union: EU ETS allowance costs are treated as a cost of doing business for covered entities. For voluntary credit purchases, the tax treatment varies by member state. In the UK, HMRC has clarified that voluntary carbon credit purchases are deductible as trading expenses if they are incurred wholly and exclusively for business purposes.

Canada: The federal carbon pricing system creates a direct financial incentive through the Output-Based Pricing System (OBPS). Businesses that reduce emissions below their benchmark can earn surplus credits to sell. Voluntary credit purchases are generally deductible as business expenses, and some provinces offer additional incentives for carbon reduction investments.

Australia: The Safeguard Mechanism requires large emitters to offset excess emissions using Australian Carbon Credit Units (ACCUs). The government has introduced incentive programs to support businesses investing in offset projects, and ACCU purchases are tax deductible.

A few tax considerations that often get overlooked:

• Timing of deduction: In the US, you can generally deduct the cost of credits in the year they are purchased. However, if you are buying credits for future-year offsets, the deductibility may be deferred under prepaid expense rules. Talk to your accountant about the timing.
• Capital vs. expense treatment: Some jurisdictions may treat certain carbon credit purchases as capital assets rather than operating expenses, particularly if the credits are held for trading or speculative purposes rather than retirement. This affects depreciation and deduction schedules.
• State and local incentives: Several US states, including California, New York, and Washington, offer additional tax incentives for sustainability investments that may stack with federal benefits.
• International coordination: The OECD's Pillar Two global minimum tax framework is beginning to interact with carbon credit accounting in complex ways for multinational companies. If you operate across borders, get specialized advice.

The bottom line: carbon credits are not just an environmental cost. When structured properly, they create real tax value. But the rules are evolving rapidly, and generic advice is not enough. Engage a tax professional who understands environmental credits specifically.

Frequently Asked Questions

How much do carbon credits cost in 2026?

Carbon credit prices in 2026 vary dramatically by type and quality. Avoidance credits from renewable energy or cookstove projects trade below $5 per tonne. Nature-based removal credits such as reforestation and mangrove restoration range from $15 to $35 per tonne. Technology-based removal credits like direct air capture cost $150 to $500 or more per tonne. Compliance market allowances in the EU ETS trade around $65 to $85 per tonne. The price you pay depends on the credit type, the registry, the vintage year, and whether the project delivers co-benefits like biodiversity or community development.

What is the difference between a carbon credit and a carbon offset?

A carbon credit is the tradeable certificate representing one metric tonne of CO2 equivalent either reduced or removed from the atmosphere. A carbon offset is the act of using that credit to compensate for your own emissions. Think of it this way: the credit is the instrument, the offset is the action. When a business buys a carbon credit and retires it against its own emissions inventory, it has offset those emissions. The terms are often used interchangeably in casual conversation, but the distinction matters for accounting and ESG reporting purposes.

Are carbon credits tax deductible for businesses?

In most jurisdictions, the cost of purchasing carbon credits is deductible as an ordinary business expense if the purchase is directly related to your business operations or regulatory compliance. In the United States, the IRS treats voluntary carbon credit purchases as deductible business expenses under Section 162 when they serve a legitimate business purpose such as meeting contractual sustainability commitments or regulatory requirements. The 45Q tax credit offers up to $85 per tonne for direct air capture and $60 per tonne for geological carbon sequestration. Consult a tax professional familiar with environmental credits, as the rules vary by country and are evolving quickly.

How do I know if a carbon credit is high quality?

A high-quality carbon credit meets five criteria established by the Integrity Council for the Voluntary Carbon Market (ICVCM): additionality (the emission reduction would not have happened without the project), permanence (the carbon stays removed for at least 100 years or has a buffer pool to cover reversals), no double counting (the credit is only claimed by one entity), accurate quantification (conservative measurement with third-party verification), and no net harm to communities or ecosystems. Look for credits registered with Verra (VCS), Gold Standard, or American Carbon Registry, and check for CORSIA eligibility or ICVCM Core Carbon Principles approval.

Do small businesses need to buy carbon credits?

Most small businesses are not legally required to buy carbon credits. Compliance obligations typically apply to large emitters producing over 25,000 tonnes of CO2 annually. However, small businesses are increasingly purchasing voluntary credits for strategic reasons: meeting customer expectations for sustainability, fulfilling supply chain requirements from larger corporate buyers, differentiating their brand, and getting ahead of potential future regulations. If your business wants to claim carbon neutrality, you will need credits to offset whatever emissions remain after you have reduced as much as possible through direct operational changes.

What is the voluntary carbon market?

The voluntary carbon market (VCM) is where businesses and individuals buy carbon credits by choice rather than because a regulation forces them to. Unlike compliance markets such as the EU Emissions Trading System or California's cap-and-trade program, the VCM operates without government-mandated caps. Buyers participate to meet corporate sustainability goals, fulfill net-zero commitments, or respond to stakeholder pressure. The VCM was valued at approximately $1.7 billion in 2025 and is projected to grow significantly as more companies set climate targets. Major registries operating in the VCM include Verra, Gold Standard, and American Carbon Registry.

Carbon credits are only part of the picture — see our deep dive into the climate finance funding gap and SDG 13 in 2026.