Voluntary markets

What a carbon credit actually is

One credit represents one tonne of carbon dioxide equivalent (tCO₂e) either kept out of the atmosphere or removed from it. It only becomes a credit when an approved methodology has been followed, an independent body has verified the result, and a registry has issued serialised units.

The life of a credit

1. Design. A developer selects a methodology and models a baseline — what emissions would have been without the project.
2. Validation. An independent auditor checks the design before the project starts.
3. Monitoring. The project runs and measures actual performance over a defined period.
4. Verification. A third-party auditor confirms the measured reductions.
5. Issuance. The registry creates serialised credits for that vintage.
6. Transfer and retirement. A buyer acquires the credits and retires them, permanently cancelling them so they can never be resold or claimed again.

Avoidance versus removal

Avoidance credits represent emissions that were prevented — a wind farm displacing coal generation. Removal credits represent carbon physically taken out of the atmosphere and stored — afforestation, biochar, engineered capture. They are not interchangeable, and the market prices them very differently.

Why prices vary so widely

Across PRAN’s own book, credits range from well under a dollar to several hundred dollars per tonne. That spread is not arbitrary. It reflects permanence, additionality, co-benefits, registry standard, vintage, and scarcity. A bundled renewable-energy credit from an older vintage and a verified community forestry removal are different products that happen to share a unit.

Where the market breaks

The failure points are consistent: opaque pricing, manual settlement, credits transferred on trust before payment clears, and claims that outrun what the underlying credit supports. Infrastructure — escrow, verifiable records, honest price disclosure — is what closes those gaps.