Yellen Embraces Carbon Market Potential With Push for Integrity.

YELLEN, Janet, 1946-; MARKET potential; ATMOSPHERIC carbon dioxide; CARBON paper; CARBON offsetting; CARBON

The Biden administration has released guidelines for using carbon offsets to combat climate change. The guidelines recommend that companies be allowed to use carbon credits to offset a portion of their Scope 3 emissions, which are generated by their suppliers and customers. The principles outlined in the guidelines align with those developed by industry-led governance bodies and endorse the potential of voluntary carbon markets to reduce emissions and create economic opportunities. The guidelines aim to address existing challenges and ensure that carbon markets promote best practices and high-integrity carbon credits. The market for offsets could reach $1 trillion by 2050 if rules are eased and their use is expanded. The US government envisions the finance sector playing a role in addressing the challenge of ensuring offsets truly compensate for pollution. The guidelines prioritize making measurable and feasible emission reductions within companies' value chains, with offsets being considered only when it is unreasonable to expect full abatement of supply chain emissions. The United Nations-backed Science Based Targets initiative and the Voluntary Carbon Markets Integrity Initiative have proposed similar approaches to using carbon credits. [Extracted from the article]

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