Carbon Credit Trading Research Articles

Balancing collaborative investment with opportunity costs in a carbon complementary supply chain

PurposeThe carbon complementary supply chain (CCSC) is a collaborative framework that facilitates internal carbon credit trading agreements among supply chain agents in compliance with prevailing carbon regulations. Such agreements are highly beneficial, prompting agents to consider joint investment in emission reduction initiatives. However, capital investments come with inevitable opportunity costs, compelling agents to weigh the potential revenue from collaborative investments against these costs. Thus, this paper mainly explores carbon abatement strategies and operational decisions of the CCSC members and the influence of opportunity costs on the strategic choice of cooperative and noncooperative investment.Design/methodology/approachThe authors propose a novel biform game-based theoretical framework that captures the interplay of pricing competition and investment cooperation among CCSC agents and assesses the impact of opportunity costs on CCSC profits and social welfare. Besides, the authors also compare the biform game-based collaborative scenario (Model B) to the noncooperative investment scenario (Model N) to investigate the conditions under which collaborative investment is most effective.FindingsThe biform game-based collaborative investment strategy enhances the economic performance of the traditional energy manufacturer, who bears the risk of opportunity costs, as well as the retailer. Additionally, it incentivizes the renewable energy manufacturer to improve environmental performance through renewable projects.Originality/valueThis research contributes significantly by establishing a theoretical framework that integrates the concepts of opportunity costs and biform game theory, offering new insights into the strategic management of carbon emissions within supply chains.

Consolidating building greening: Integrating mobile modular vertical greening systems into prefabricated building

Vertical greening systems increase green plant coverage within built environments, enhancing urban air quality while reducing building energy consumption. But they encounter challenges related to intensive maintenance and significant costs. As a mainstream future building form, the characteristics of modularization and factory customization inherent in prefabricated buildings can effectively address the demands of vertical greening system. This study employs structural equation model and cloud model to examine the feasibility of integrating mobile modular vertical greening system into prefabricated structures, based on a survey of 403 respondents in Shandong Province, China. The study highlights the supportive roles and mediating effects of two maintenance management measures. It confirms the strong correlations between cost control strategies and the successful integration of mobile modular vertical greening system into prefabricated building. The results indicate that integrating intelligent technology and plant-microalgae combined systems are essential exogenous and endogenous maintenance management strategies. They exert a positive influence on prefabricated modular vertical greening systems. A positive interconnection exists between integrating intelligent technology and the plant-microalgae combined system. Carbon credit trading incentive proves more advantageous in reducing mobile modular vertical greening system costs. Plant-microalgae combined system playing a partial mediating role. Although crowdfunding-community participation does not significantly reduce the costs of mobile modular vertical greening system, integrated intelligent technology mediates this relationship. This highlights the indirect role of crowdfunding-community participation in facilitating cost control for these systems.

An Introduction to Carbon Credit Markets and Their Potential for Florida Agricultural Producers

This publication is part of a larger body of work initiated by the UF/IFAS Extension Climate and Carbon Extension Educators that informs a general audience about climate issues and mitigation strategies. It was prepared to help Extension agents, farmers, and ranchers interested in carbon credit programs better understand the process of carbon credit trading, from credit generation to markets. Note that because carbon markets are relatively new, programs and prices are likely to change over time. This publication includes a list of resources for further information.

The Application of Financial Technology in Carbon Finance

With the rapid development of the economy, the pollution of the environment in various countries is also increasing, and the concept of carbon finance is gradually emerging. Fintech has gradually entered people's vision, and how to use Fintech to help the realization of carbon finance has become a research issue for some scholars. Existing research mainly focuses on a specific application and lacks a literature review. By summarising the literature on fintech and carbon finance, this paper outlines several currently common applications. It mainly covers the application of blockchain in carbon finance, such as using the tamper-proof nature of blockchain to make the carbon credit trading process more transparent, and using the contract layer of blockchain-smart contracts to prevent the accumulation of carbon credits by adding smart contracts into the trading process of carbon credits, etc. This paper concludes the application of big data and cloud computing in carbon finance, such as using big Data and cloud computing technology to analyze massive data, as a way to reduce the risk of carbon trading, etc. The research puts forward a certain degree of recommendations on the application of financial technology in carbon finance.

Research on Multi-Microgrid Electricity–Carbon Collaborative Sharing and Benefit Allocation Based on Emergy Value and Carbon Trading

In response to climate change, the proportion of renewable energy penetration is increasing daily. However, there is a lack of flexible energy transfer mechanisms. The optimization effect of low-carbon economic dispatch in a single park is limited. In the context of the sharing economy, this study proposes a research method for multi-park electricity sharing and benefit allocation based on carbon credit trading. Firstly, a framework for multi-park system operation is constructed, and an energy hub model is established for the electrical, cooling, and heating interconnections with various energy conversions. Secondly, a park carbon emission reduction trading model is established based on the carbon credit mechanism, further forming an optimal economic and environmental dispatch strategy for multi-park electricity sharing. Matlab+Gurobi is used for solving. Then, based on asymmetric Nash bargaining, the comprehensive contribution rate of each park is calculated by considering their energy contribution and carbon emission reduction contribution, thereby achieving a fair distribution of cooperation benefits among multiple parks. The results show that the proposed method can effectively reduce the overall operational cost of multiple parks and decrease carbon emissions, and the benefit allocation strategy used is fair and reasonable, effectively motivating the construction of new energy in parks and encouraging active participation in cooperative operations by all parks.

Carbon management accounting an evolving approach to enhance transparency and accountability in accounting and reporting practices

Purpose This study aims to examine the factors driving the adoption of carbon management accounting (CMA) and various considerations that mediate its effectiveness in accounting and disclosure practices. Design/methodology/approach This study used an exploratory, cross-sectional, quantitative design. Academics, managements/executives, professional accountants, professional auditors and researchers served as the primary units of analysis. This study used a survey method to gather data through a structured online questionnaire. The data were analyzed using descriptive statistics and partial least squares structural equation modeling (PLS-SEM). Findings The results revealed that the factors driving the adoption of CMA directly influence the effectiveness of CMA practices, with a significant mediating effect of regulatory and ethical aspects. Furthermore, this study revealed the difficulty of accounting, quantifying and reporting carbon emissions and revenue generation from the trading of carbon credits. This highlights the critical role of standard-setters and academics in deciding the concrete methodology to promote uniformity in carbon disclosures. Research limitations/implications The major limitations of this study are that it considered only the perception of experts and did not study the actual practices of CMA by considering companies that have already implemented CMA. Further studies should consider this aspect to validate the results of this study. Furthermore, the findings highlight the insignificant effect of economic, environmental and social aspects in enhancing the overall effectiveness of CMA. This is because of the limited number of factors considered in the study of such metrics. To overcome this limitation, future studies should consider wider aspects to validate the outcomes of this study. Practical implications The major contribution of this study is that it serves as a base input for business organizations, academics, researchers and regulatory authorities who are working to implement CMA strategies to reduce carbon emissions and promote net-zero business practices. Originality/value The outcome of this study is unique and new, as the subject matter of this study is in the nascent stage. The outcome of this study may become a significant valid input for regulators and policymaking companies to gain knowledge about CMA practices and motivate them to integrate CMA practices as part of their sustainability initiatives.

The evolution of green fintech: Leveraging AI and IoT for sustainable financial services and smart contract implementation

The convergence of financial technology and sustainability has given rise to green fintech, an innovative field leveraging cutting-edge technologies to address environmental challenges through financial solutions. This review explores the evolution of green fintech, focusing on the transformative roles of Artificial Intelligence (AI), Internet of Things (IoT), and smart contracts in developing sustainable financial services. Through a comprehensive analysis of recent literature and case studies, we examine how AI enhances ESG assessments, enables data-driven sustainable investment strategies, and facilitates green lending practices. We investigate IoT applications in environmental monitoring, supply chain transparency, and smart grid integration, highlighting their contributions to sustainable finance. The implementation of smart contracts for sustainability is explored, discussing their potential in green bonds, carbon credit trading, and renewable energy markets. The paper addresses key challenges facing green fintech, including data quality issues, privacy concerns, and regulatory uncertainties, proposing future directions for research and development. Our findings suggest that the integration of AI, IoT, and smart contracts in green fintech has significant potential to accelerate the transition to a sustainable global economy by embedding environmental considerations into financial decision-making at all levels. This article contributes to the growing body of literature on sustainable finance, providing insights for practitioners, policymakers, and researchers. It underscores the need for a multidisciplinary approach to overcome technological, regulatory, and socio-economic barriers, paving the way for a more sustainable and technologically advanced financial ecosystem.

Synergizing AI and Blockchain: Innovations in Decentralized Carbon Markets for Emission Reduction through Intelligent Carbon Credit Trading

This study aims to enhance the paradigm of decentralized carbon markets by proposing an innovative integration of artificial intelligence (AI) and blockchain technology for intelligent carbon credit trading with the goal of attaining sustainable emission reduction. Blockchain systems powered by artificial intelligence (AI) have the potential to boost the effectiveness of current systems and expedite the global implementation of emissions trading. Although still in its infancy, blockchain artificial intelligence (AI) presents a promising solution to some of the world's most pressing environmental issues. Environmental sustainability is greatly affected by artificial intelligence because of its decentralized computation architecture. The Artificial Intelligence and blockchain are outstanding direction for today’s environmental issues starting from carbon footprint emission to earth market unstable management, whereby the AI facilitates the best possible operational control of power systems and the blockchain offers decentralized trading platforms for the energy markets. The paper's theoretical framework, based on advanced mathematical models, serves as the foundation for this study, in which AI algorithms are methodically constructed to anticipate carbon emissions with unprecedented accuracy. Using sophisticated coding simulations and complicated mathematical formulas, the study boldly transitions into a realistic digital implementation that builds on this theoretical foundation. This complex experiment not only validates the theoretical ideas but also illustrates the complex relationship between blockchain and AI in the decentralized carbon market ecosystem. This experiment's mathematical basis is the creation of an integrated pricing model that seamlessly blends blockchain-based trading dynamics with AI-driven forecasts. The model incorporates a dynamic, self-adjusting system that responds to current market conditions, in addition to optimizing the pricing calculation of carbon credits. Complex market dynamics, player tactics, and the overall equilibrium of the carbon credit market are all modeled by mathematical simulations. The project goes deeper into building blockchain-based smart contracts, which enable safe and transparent transactions. The comprehensive mathematical results of the experiment shed light on the best way to price carbon credits while underscoring the disruptive potential of blockchain and artificial intelligence in terms of sustainable emission reduction strategies used in carbon markets. Major conclusions about the potential advantages of Blockchain AI for guaranteeing emissions reduction are drawn from the current study. Additionally, it presents a roadmap for future research in this area.

A blockchain AI solution to climate change

Background: Climate change represents a critical global challenge, hindered by skepticism towards data manipulation and politicization. Trust in climate data and its policies is essential for effective climate action. Objective: This perspective paper explores the synergistic potential of blockchain technology and artificial intelligence (AI) in addressing climate change and how their integration can enhance the transparency, reliability, and accessibility of climate science. Methods: The paper analyzes the roles of blockchain technology in enhancing transparency, traceability, and efficiency in carbon credit trading, renewable energy certificates, and sustainable supply chain management. It also examines the capabilities of AI in processing complex datasets to distill actionable intelligence. The synergistic effects of integrating both technologies for improved climate action are discussed alongside the challenges faced, such as scalability, energy consumption, and the necessity for high-quality data. Results: Blockchain technology contributes to climate change mitigation by ensuring the transparent and immutable recording of transactions and environmental impacts, fostering stakeholder trust, and democratizing participation in climate initiatives. AI complements blockchain by providing deep insights and actionable intelligence from large datasets, facilitating evidence-based policymaking. The integration of both technologies promises enhanced data management, improved climate models, and more effective climate action initiatives. Conclusion: The integration of blockchain technology and AI offers a transformative approach to climate change mitigation, enhancing the accuracy, transparency, and security of climate data and governance. This synergy addresses current limitations and futureproofs climate strategies, marking a cornerstone for the next generation of environmental stewardship.

Shaping India's climate future: A perspective on harnessing carbon credits from agriculture

Human activities are responsible for emitting greenhouse gases (GHGs) that contribute to global warming and climate change. As the world's second-largest producer of staple food and the third-largest emitter of GHGs, India has been witnessing an increase in demand for food and energy, resulting in increased emissions. Thus, to achieve net carbon neutrality by 2070, India must focus urgently on climate change mitigation. Its agriculture sector has the potential to transition from being a net emitter to a net absorber of GHGs by adopting sustainable farming practices such as zero tillage, laser-assisted precision land leveling, direct seeding of rice, intercropping, biochar application, use of solar energy, and more efficient management of irrigation water, soil nutrients, livestock feed, and manure. To incentivize climate consciousness, a voluntary carbon credit trading system could be utilized in agriculture, supported by a measurement, monitoring, reporting, and verification platform. This system would also bring about social, environmental, and financial co-benefits for its stakeholders. Specifically, the agriculture sector could substantially reduce the country's annual emissions by 84% from 2019 to 2070. But to realize their potential, the carbon markets must overcome the limitations currently set by policy, economic, cultural, and biophysical factors.

Trading carbon credit tokens on the blockchain

Innovative financial services may help to reduce global carbon emissions. We examine the activity in trading of voluntary carbon credits on a new blockchain-based exchange, which reduces the amount of intermediation in this market. Over the years 2021 and 2022, about 3.8 million tCO2e tokens have been tokenized on the carbon token exchange, of which about 2.8 million tCO2e tokens have been burned, leaving 1.0 million tCO2 tokens available for purchase on the exchange. Over these two years, the total secondary market trading turnover has been $ 21.2 million. Trading liquidity is limited to only a few types of carbon credit tokens. The prices of these most liquid tokens move in line with prices of similar carbon projects available for purchase elsewhere.

New Approach Towards Sustainability – The Global Efficiency Concept (GEff)

In the actual economical environment, business sustainability requires high-efficiency technological processes and new innovative developments. That is why the efficiency concept has to be present at all levels of industrial and financial activities. The proposed concepts in this paper could be further developed as a model for improving companies’ corporate energy policies.
 Nowadays, some purchase decisions for equipment are still driven predominately by the purchase price, and the full consequences of energy efficiency and the impact on the environment are not always considered.
 In general relatively “low value equipment” purchase policy is still driven by purchase price only, in spite of the evidence that such price represents a maximum of 5 % to 7 % of the total expenses related to the total costs of ownership. In the minerals industry “low value equipment”, like low-voltage motors (up to 1100 volts, 50/60 Hz), are found many times and in very large numbers, their efficiency and reliability influencing dramatically specific costs of technological processes.
 Although with “major equipment” energy savings are considered more in the purchase decision, every growing importance on the environment of “Green House Gas” (GHG) emissions is still not a major factor when selecting equipment. Often more traditional equipment is purchased at the expense of new innovative technologies that in addition to providing energy savings can also be used as a tool for trading Carbon Credits in the financial marketplace. An example of such a technology is the IsaMill™ comminution machine, which is becoming more widely used in gold and general mining operations in South Africa and throughout the world. Comminution in the mining industry is one of the most energy intensive activities in the world, and the innovative use of “major equipment” saving power can also have a positive effect on the environment.
 The paper presents descriptions of the essentials of the Global Efficiency (GEff) concept that has been promoted over the last years in South Africa. Price-efficiency criteria (as a corollary of GEff) are investigated for applications incorporating equipments that are driven by low and high voltage motors.
 The paper presents theoretical and technical aspects analysing the economic and environmental impact, by reducing total cost of ownership with energy savings, for one “low value equipment” in typical applications largely used in mineral processing in the gold mining industry, and one “major equipment” purchase at a current operating gold mine where the innovative IsaMill™ comminution technology was installed as an alternative to traditional older technologies.
 Besides the impact of energy savings with high-efficiency technological processes and new innovative developments, this paper suggests the general impacts of:
 
 Technical and economical performance improvements and competitiveness of mining corporations to international standards;
 Defusing incipient energy crisis in the gold mining sector;
 Improving environmental conditions;
 Creating new job opportunities in the gold mining sector.

Blockchain for sustainability: A systematic literature review for policy impact

Blockchain technology has been proposed to achieve sustainable development through various solutions, such as carbon credit trading, energy systems and supply chain management. While existing literature has not covered this topic in a structured fashion, this paper provides insights to policymakers on how blockchain can deliver sustainable development. This study conducted a systematic literature review on the role of blockchain technologies in assisting policymakers in achieving ESG and environmental sustainability goals. The paper performs a detailed PRISMA SLR analysis of 10,188 technical and policy papers sourced from Scopus and IEEE databases to ensure high-quality inputs and breadth of coverage across relevant sources. In addition, the study reviews the relevant regulatory environment related to ESG, including SDGs, IPCC, COP 27, ESMA, ISSB, SEC, GRI, TCFD, ESRS, IFRS S1 and S2 and CRSD. Most papers do not outline a structured approach to applying blockchain in the emerging regulatory environment. Our paper outlines recommendations to policymakers wishing to ensure that the blockchain research community and solutions proposed are usefully directed to enable the world to achieve its net zero goals.

Experimental performance analysis of photovoltaic systems applied to an positive energy community based on building renovation

Global carbon neutrality can be achieved by reducing greenhouse gas emissions in the building sector using various renewable energy systems, such as photovoltaic (PV) systems, at the community level. In this study, various PV systems were applied to a community consisting of two residential and two nonresidential buildings, and a comparative analysis was conducted to achieve a net yearly positive energy balance at the community level. The PV systems included building-attached PV (BAPV), building-integrated PV (BIPV), and BIPV–thermal (BIPVT) systems. An analysis of the empirical data over a year revealed that the annual net energy balance of the proposed community was 139%, the self-sufficiency of building energy consumption was 33.2%, and the self-consumption of solar power generation was 76.7%. Based on these empirical data, the initial investment cost savings of the PV system and payback period were analyzed through carbon credit trading. The results showed that the payback period ranged from 9 to 17 years.

Carbon Is the New Black: A Case of EKI Energy Services Limited

The case study titled ‘Carbon is the new black: A case of EKI Energy Services Limited’ showcases the phenomenal growth achieved by a young startup based in Indore promoted by a visionary entrepreneur Mr Manish Kumar Dabkara who had a vision and foresightedness to enter the Carbon Credit Market when no big player in the country was leaping in this field. The case study chronicles how EKI Energy Services Limited created a space for itself and has become a name to reckon within the Carbon Credit Market. The case study emphasizes the Initial Public Offer of EKI Energy Services and how it created a buzz in the stock market when its share price skyrocketed. The study also throws light on the international agreements on Carbon Credit trading mechanisms under the aegis of the United Nations viz. Kyoto Protocol and the Paris Convention. Further, the case study discusses opportunities and challenges, which lie ahead of EKI Energy Services Limited in the Carbon Credit Market.

A scheduling framework for VPP considering multiple uncertainties and flexible resources

This paper presents a two-stage scheduling framework for a virtual power plant (VPP) to address uncertainties in wind power plants (WPP), photovoltaic (PV), load, and price in the power system. The framework consists of a day-ahead (DA) scheduling stage and an intraday adjustment stage. The DA scheduling stage formulates the VPP's internal controllable resource scheduling strategy and the energy market's bidding plan. The intraday adjustment stage provides flexibility to adjust the scheduling strategy of controllable resources in the VPP to enhance power generation stability. To address profit distribution issues, the paper proposes a profit distribution strategy based on scheduling costs of each component unit of the VPP. The VPP considers various factors, such as battery capacity degradation, carbon credit trading, flexibility of electric vehicles (EVs), and novel demand response (DR) strategies. The case study demonstrates that accounting for battery capacity degradation reduces the utilization of energy storage systems (ESSs) and EVs, while considering controllable load and EVs increases the VPP's flexibility and decreases carbon emissions. Furthermore, the proposed two-stage scheduling strategy effectively handles multiple uncertainties. Finally, the implementation of new DR strategies leads to a reduction in cost by 6.83% (time-of-use) and 8.1% (real-time price) for the VPP.

THE INTEGRATION OF SMART GRID TECHNOLOGY WITH CARBON CREDIT TRADING SYSTEMS: BENEFITS, CHALLENGES, AND FUTURE DIRECTIONS

The integration of smart grid technology with carbon credit trading systems offers a promising path to improve the grid efficiency and stability and reduce greenhouse gas emissions. This paper examines the possible interoperability of smart grid technology and carbon credit trading systems. Smart grid technology, characterized by its advanced monitoring, control, and optimization capabilities, offers the foundation for real-time data collection and analysis. On the other hand, carbon credit trading systems create financial incentives for reducing emissions. By combining these two systems, Nigeria can improve grid stability and increase the adoption of renewable energy sources, accelerating the transition to cleaner energy. Additionally, this paper discusses challenges that could hamper the successful integration of smart grid and carbon credit systems such as data security, regulatory compliance, and technological infrastructure requirements. Using case studies and examples, this paper examines the successful implementation of an integrated smart grid and carbon credit trading system, sharing valuable lessons learned and best practices. The paper also highlights the potential for advancements in technology and policy frameworks to promote wider adoption of these integrated systems.. Keywords: Integration, Smart Grid Technology, Carbon, Credit, Trading Systems.

Klima DAO: a crypto answer to carbon markets

AbstractTackling major societal challenges often requires a significant level of organizational novelty. One such recent example is Klima DAO, a decentralized autonomous organization (DAO) that seeks to transform voluntary markets through the adoption of carbon credits. DAOs rely on self-executing rules and have a high level of decentralization. By leveraging blockchain and related technologies, Klima DAO offers innovative solutions to universal problems of organizing in both its governance and product delivery. Blockchain tools enable Klima DAO to operate uniquely, allowing for rapid scaling while maintaining decentralized governance and promoting transparent carbon credit trading with low transaction fees. As such, Klima DAO may serve as a model for future organizations in search of greater transparency and flatter governance structures.

Modeling forest carbon sink trading with carbon credit using stochastic differential game

Forest carbon sinks integrated into the carbon trading is an important way to solve the funding shortage of carbon emission reduction and is a major measure to achieve carbon sequestration and thereby carbon neutrality. We propose a carbon credit trading mechanism based on forest carbon sinks and build an optimal carbon credit trading model on forest companies and manufacturers. The scale of carbon sink forest and trading price is determined by stochastic differential game method. Reasonable emission reduction responsibilities are set to achieve coordination between forest carbon sequestration and economic development. The results show that farsighted forest company is more likely to participate in carbon credit trade when the total amount of forest carbon sequestration is small, while shortsighted forest company is more likely to participate in carbon credit trade when the total amount of forest carbon sequestration is large. Low emission reduction responsibility in carbon credit trade is conductive to increasing forest carbon sequestration, and improving the enthusiasm of shortsighted forest company to participate in the trade, which reflects the superiority of the proposed carbon credit trading mechanism. This implies that the forest company should undertake low emission reduction responsibilities to achieve a win-win situation for economic and environmental benefits.

The Crossover Cooperation Mode and Mechanism of Green Innovation between Manufacturing and Internet Enterprises in Digital Economy

Under the background of the digital economy, manufacturing seeks to improve green manufacturing and the level of greenness of products through digital empowerment. However, there exists a certain degree of technical difficulty and cost pressures for independent transformation to enhance green innovation performance through digitalization. How to conduct crossover cooperation with Internet enterprises needs to be explored. Taking automobile manufacturing enterprises as the case background, this paper constructs an evolutionary game model of green innovation crossover cooperation between traditional automobile manufacturing and Internet enterprises in the context of carbon credit policy. From the perspective of the extra effort cost of manufacturing enterprises and the excess income of Internet enterprises, this paper analyzes the mode selection strategy of green innovation crossover cooperation between the two types of subjects, and also analyzes the crossover cooperation mechanism of green innovation from three aspects: income distribution mechanism, carbon credit trading mechanism, and R&D subsidy mechanism. The results show that (1) Reducing the cost of digital green innovation transformation in manufacturing and the excess returns obtained under the free-riding behavior of Internet enterprises will help promote in-depth cooperation among crossover entities. (2) The benefit distribution dominated by manufacturing enterprises is helpful to evolve toward the direction of the alliance cooperative innovation mode and improve the benefits of green innovation cooperation. (3) Under the government’s single weak intervention management mechanism, optimizing carbon credit accounting and assessment standards can effectively guide manufacturers and Internet companies to conduct alliance green innovation cooperation, but they still need to be matched with appropriate R&D subsidies to form a compound strong intervention guidance mechanism to obtain higher social and ecological benefits.