A carbon credit is a certificate representing one tonne of CO2 equivalent that was avoided or removed from the atmosphere. It only exists once a project has been audited by an independent verifier and the credit has been issued in a public registry such as Verra or Gold Standard, with a unique serial number. When a company uses the credit to offset its own emissions, it is “retired” and leaves circulation permanently, it cannot be resold or reused.
Why it matters: it’s the basic unit of the entire carbon market, voluntary and compliance alike, and understanding what it actually represents is what keeps a purchase from collapsing under the first external audit.