Carbon compensation

Carbon compensation means offsetting emissions by reducing them elsewhere. Climate change mitigation projects, such as reforestation projects, generate a specific amount of CO₂ certificates based on the estimated amount of emissions reduced or saved as a result of this project. Other parties, such as governments or companies, can buy these CO₂ certificates to offset their emissions on the balance sheet. On an individual level, compensation can be made by agreeing to pay a certain amount in addition to a purchase, which is then used to finance such mitigation projects.