What is a carbon credit?

A carbon credit is like a green ticket given out for helping to reduce or avoid harmful greenhouse gases that are causing climate change. Each credit represents the reduction of one tonne of carbon dioxide, or its equivalent in other greenhouse gases. They come from projects that help in fighting climate change like using clean energy sources, planting more trees or improving energy efficiency. Before these credits are given out, the projects are checked carefully to ensure they are actually making a difference. When people or companies buy these credits, they are effectively balancing out their own carbon emissions and helping to fund these positive projects.