AirCarbon Pte Ltd, a Singapore-based company that facilitates trading in carbon credits, is keen on setting up shop in India, the company’s Co-Founder and Chief Emissions Officer, Thomas McMahon, told businessline recently.
AirCarbon is a platform—somewhat like the NSE portal. “We do not broker trades; we simply streamline carbon trading,” says the company’s website. As such, Indian companies can use the platform to sell (or buy) carbon credits even today.
Presence in India
However, McMahon and Vishwajit Dahanukar, Director, Envex Technologies, which is AirCarbon’s associate in India, explained that AirCarbon’s presence in India will make trading much easier. “Your current bank will be able to process your transactions, you don’t need to have an international bank account,” Dahanukar said.
Business Line has independently learnt that AirCarbon is interested in setting up operations in the GIFT SEZ, Gandhinagar, Gujarat, which is run by government of India’s International Financial Services Centres Authority. (The GIFT SEZ is an International Financial Centre, which means that it is a place that houses units that provide various financial services in currencies other than the domestic currency—which has many advantages.)
Carbon markets
AirCarbon is keen on being present in India because it believes that India will be a major player in the global carbon market. Carbon markets refers to buying and selling carbon credits (or carbon offsets). Businesses (or even individuals) earn carbon credits for doing something that has the effect of reducing carbon dioxide emissions or absorbing carbon dioxide from the atmosphere.
For example, if a wheat farmer grows trees on his farmland, he can earn carbon credits equivalent to the quantity of carbon dioxide absorbed by the trees—one credit for one ton of carbon dioxide absorbed. The buyers of the credits are entities such as governments, municipalities, industry associations or companies like Google and Apple that have either voluntarily vowed, or under obligations, to reduce carbon dioxide emissions from their operations and can’t do it all by themselves.
McMahon believes that the opening up of carbon markets is like discovering a new oil field—you know there are billions of tons of oil but you are yet to take out any. “We are talking to the regulators. There is an interest to see market formation,” he said.
He said that AirCarbon operated with blockchain technology, where every carbon credit is tokenised with a record of every transaction. The exchange has 152 member firms across the world.