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What Is An ERU (Emission Reduction Unit)?

Global Climate Change (43)

“European Commission. Climate Change Key Terms. Emission reduction unit (ERU) = Unit generated from a Joint Implementation activity, certifying an emission reduction of one tonne of carbon dioxide (CO2) equivalent.”

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As stated in one of my previous posts, corporations and countries worldwide (can) trade emission reduction units (ERU´s) as commodities to “even out” carbon dioxide (CO2) consumption and through these trading systems provided fund sustainable development projects in developing countries. For more information about ERU´s, see for example Australian Government Clean Energy Regulator where ERU´s are explained in detail.

ERU´s are financial products that are traded as futures on both primary and secondary markets, and the prices vary accordingly. By funding an ERU project the investor trades carbon as a commodity, linked to a specific sustainable development project. See also FERN – Trading carbon: How it works and why it is controversial.

Note from author: This post serves only as learning and informational material and is by no means any kind of investment advice. 

Connect with me on Twitter @annemariayritys – for climate-related posts only @GCCThinkActTank & to receive my newsletter delivered personally to you, subscribe to Leading With Passion

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