Carbon market

A set of institutions, regulations, project registration systems and trading entities that has emerged from the Kyoto Protocol. The protocol sets limits on total emissions by the world’s major economies, as a prescribed number of “emission units.” The protocol also allows countries that have emissions units to spare — emissions permitted but not “used” — to sell this excess capacity to countries that are over their targets. This is called the “carbon market,” because carbon dioxide is the most widely-produced greenhouse gas, and because emissions of other greenhouse gases will be recorded and counted in terms of their “carbon dioxide equivalents.”