Carbon Finance

Carbon finance is the commonly used term to refer to specific investment in technologies or processes that reduce greenhouse gas (GHG) emissions and result in the creation of carbon credits. Carbon finance (CF) is therefore directly associated with carbon offsets as a mechanism that allows a company, organization, or individual to reduce its environmental impact on the atmosphere in one area by investing in projects that reduce GHGs in another. As a result, carbon finance helps deploy green technology into new areas. However, it is a [Page 82]complex mechanism and does not always create wide-scale green benefits in creating low-carbon economies. This article outlines different forms of CF, its relationship to waste and energy management, and possibilities and pitfalls of CF use for green technology.