Skip to content

CS Professional · Environmental, Social and Governance (ESG) - Principles and Practice · Environment

Ishaan Chemicals Ltd. says it will emit 100 tonnes of CO2e in a year but has bought carbon credits equal to 100 tonnes, resulting in 'net zero' for that year. Which statement best reflects the carbon market concept applied?

This is carbon offsetting. The company balances its own emissions by buying credits that represent emission reductions or removals achieved elsewhere. Its actual emissions are unchanged, so it is not sequestration, value-chain redesign or any Kyoto mandate for abolition.

  1. ACarbon offsetting, where emissions are balanced by credits from emission reductions elsewhereCorrect
  2. BCarbon sequestration by the company's own plant only
  3. CScope 3 elimination by value-chain redesign
  4. DMandatory abolition of the company's emissions under Kyoto

Explanation

Buying credits that represent reductions or removals elsewhere to balance own emissions is offsetting. It does not reduce the company's own emissions, nor does it eliminate Scope 3, and Kyoto did not mandate abolition for companies.

Did you get it right without looking?

One question tells you little. A timed set on Environment shows your real accuracy, how long you take and where you lose marks.

Practise EnvironmentFree diagnostic mock

More Environment questions