# Carbon Credit

*ESG & Sustainable Finance — Finicade finance glossary*

A carbon credit represents one tonne of emissions avoided or removed, bought to offset emissions elsewhere. The voluntary market's integrity has been badly damaged by investigations finding that a large share of forestry credits represented no additional reduction at all. Removal credits with permanent storage are treated very differently from avoidance credits, and the price gap between them reflects that.

**Also known as:** carbon offset, voluntary carbon market, REC vs offset

**Related terms:** [Carbon Price](https://finicade.com/glossary/carbon-price), [Additionality](https://finicade.com/glossary/additionality), [Net Zero](https://finicade.com/glossary/net-zero), [Greenwashing](https://finicade.com/glossary/greenwashing), [Renewable Energy Certificate](https://finicade.com/glossary/renewable-energy-certificate)

Source: https://finicade.com/glossary/carbon-credit