Carbon Credits

I really like the idea of carbon credits because I believe that the profit incentive is the biggest driver for action and efficiencies. In case you do not know what carbon credits are, here's a quick explainer. A carbon credit is a permit that allows the owner to release a certain amount of carbon into the atmosphere. That permit gets a monetary value and is freely traded. Basically, a company who is a heavy polluter can buy carbon credits from another company that specialises in removing carbon from the atmosphere, by planting many trees for example, a net positive for the environment.

A great example of this working well is Tesla. Tesla was able to finance a huge parts of their business in the early days through carbon credits. Without being able to sell carbon credits to dirty companies they may have gone under before achieving large scale EV production.

Nick Hedley recently wrote a good article for News 24 about how carbon credits could really benefit South Africa. Our country as well as the rest Africa has vast tracts of wilderness which could potentially sell carbon credits.

The management of the Kruger Park spend a lot of time, money and effort looking after natural resources and biodiversity, making the world a better place. They should be able to make extra money from that. Nick gives a few other examples of how this system can benefit the country through farming and land reform, give it a read (may need a sign-up or subscription).