Carbon and Climate Change Terminology

As COP27 gets underway in Sharm El-Sheikh in Egypt this week, we’ve put together a guide to the terms, phrases and acronyms that characterise the climate debate to help all market participants understand and engage with the voluntary carbon market. From AMC and BVCM to SBTi and VCM, this guides you the A to V on terminology:  

Article 6

Article 6 of the Paris Agreement on greenhouse gases enables Parties to cooperate around implementing their nationally determined contributions (NDC) towards emission reduction. 


Advanced market commitment (AMC) is a binding contract used to guarantee a viable market for a product once it is successfully developed. In the carbon market, AMC is being used to accelerate the development of carbon removal technologies 


BioCarbon is the carbon which is naturally absorbed and stored by plants and trees. It has been proven to turn agricultural waste into a product that improves soil nutrients, moisture and the growing environment. BioCarbon fuel can be used as peak load fuel in existing bioenergy plants, as a substitute fuel for oil boilers, as quality fuel for high efficiency and low emission small-scale heating appliances. 

Blue Carbon

Blue carbon refers to carbon captured and stored in our oceans and coastal ecosystems by algae, seagrasses, macroalgae, mangroves, salt marshes and other plants in coastal wetlands. Blue Carbon is associated with projects which avoid emissions from projects that involve oceans. 


Beyond value chain mitigation (BVCM) refers to mitigation and investment activities to reduce greenhouse gas emissions outside a company’s value chain. These are activities companies can take beyond their science-based targets. 


The Viridios Platts CARBEX are carbon credit indices. The indices reflect the value of six different types of voluntary carbon credits and serve to enhance transparency in the voluntary carbon credit. 

Carbon credits

carbon credit is a transferable instrument certified by governments or independent certification bodies to represent an emission reduction of one metric tonne of CO2e.

Carbon Removal 

Carbon removal or carbon dioxide removal (CDR) is the process of removing carbon dioxide from the atmosphere and preventing it from being released back into the atmosphere.

Carbon tokens

Carbon tokens are used to enable carbon offsets by tokenising a specific amount of CO2 for an individual asset, such as a tract of forest land. The token represents the CO2 the area of forest can absorb and can be sold to investors. There are both fungible and non-fungible tokens (NFT). 


The Clean Development Mechanism (CDM) is defined in Article 12 of the UN Protocol and allows a country with an emission-reduction or emission-limitation commitment under the Kyoto Protocol to implement emission-reduction projects in developing countries. The projects can earn certified emission reduction (CER) credits, each equivalent to one tonne of CO2, which can be counted towards meeting Kyoto targets. 


Commodity Futures Trading Commissions (CFTC) was established by the US government in 1974 to protect the public from fraud, manipulation and abusive practices related to the sale of commodity and financial futures and options. 

Climate finance 

Climate finance refers to local, national or transnational financing – drawn from public, private and alternative sources. For example, Viridios Capital provides climate finance for a range of projects around the world.  

Climate Change Adaptation

Climate change adaptation means protecting people, economies and the environment from climate change by adapting human behaviour and systems. 

Climate Change Mitigation 

Climate change mitigation means avoiding and reducing greenhouse gas emissions from entering the atmosphere to prevent global temperatures reaching extreme levels. 

Compliance markets 

Compliance markets are regulated national, regional or international carbon reduction regimes used by companies and governments that by law have to account for their greenhouse gas emissions. 


COP27 is the 2022 United Nations Climate Change Conference or the Conference of the Parties (COP27) of the UNFCCC being held in Sharm El Sheikh, Egypt. 


Direct Air Capture (DAC) technologies remove CO2 from the atmosphere. The CO2 can then be stored deep in the earth resulting in a carbon dioxide removal (CDR). 

Emissions Avoidance

Emissions avoidance is when an activity or project results in future greenhouse gas emissions being avoided or reduced. 


A greenhouse gas (GHG) is a gas that absorbs and emits radiant energy within the thermal infrared range, causing the greenhouse effect. 


The International Emissions Trading Association (IETA) is a non-profit business organisation working to establish a functional international framework for trading in greenhouse gas emission reductions. 

Kyoto Protocol

The Kyoto Protocol brings to life the United Nations Framework Convention on Climate Change by committing 37 industrialised countries and economies in transition to limit and reduce greenhouse gases emissions in accordance with agreed individual targets. Targets add up to an average five percent emission reduction compared to 1990 levels over the five year period 2008–2012. 

Loss and Damage

Loss and damage is referenced in Article 8 of the Paris Agreement and refers to the adverse effects of climate change resulting from extreme weather events but also sea level rise, increasing temperatures, ocean acidification, glacial retreat and related impacts, salinisation, land and forest degradation, loss of biodiversity and desertification. 


Nationally Determined Contributions (NDCs) efforts by each country to reduce national emissions and adapt to the impacts of climate change.


Net-zero emissions refers to achieving an overall balance between greenhouse gas emissions produced and greenhouse gas emissions removed from the atmosphere. Under the Paris Agreement emissions need to reach net zero by 2050.

Nature-based Solutions

Nature-based Solution (NbS) are actions that aim to protect, manage, conserve or restore natural ecosystems. The current scope for nature-based solutions is broad, with more than 300 climate actions considered to fall under NbS by the European Commission. These include actions ranging from reforestation projects to peatland restoration projects.

Paris Agreement 

The Paris Agreement is an international treaty on climate change. Adopted in 2015, the agreement covers climate change mitigation, adaptation, and finance. Its goal is to limit global warming to well below 2, preferably to 1.5 degrees Celsius, compared to pre-industrial levels. 


REDD+ refers to projects which Reduce Emissions from Deforestation and forest Degradation, as well as having additional benefits (+) including the conservation and sustainable management of forests and enhancement of forest carbon stocks.  


Sustainable development goals (SDGs) are a collection of 17 interlinked global goals developed in 2015 by the United Nations General Assembly with the aim of ensuring a sustainable future for all.  


Subsidiary Body for Scientific and Technological Advice (SBSTA)  is a subsidiary body of the United Nations Framework Convention on Climate Change Conference of the Parties. It meets at least twice a year to advise the COP on matters of science, technology and methodology. 


Science Based Targets initiative (SBTi) is a framework for setting corporate net-zero targets in line with climate science.    


United Nations Environmental Programme (UNEP) provides leadership and encourages partnership in caring for the environment by inspiring, informing, and enabling nations and peoples to improve their quality of life without compromising that of future generations.


The United Nations Framework Convention on Climate Change (UNFCCC) is an international environmental treaty to combat “dangerous human interference with the climate system”, in part by stabilising greenhouse gas concentrations in the atmosphere. It was signed in 1994 and currently has 198 parties.  


The Voluntary Carbon Market (VCM) is a decentralised market where private actors voluntarily buy and sell carbon credits that represent certified removals or reductions of greenhouse gases (GHGs) in the atmosphere.

Contact a carbon specialist 

For further information on carbon markets, contact one of carbon specialists at [email protected].