| Carbon credits | RECs | |
|---|---|---|
| What it represents? | Repreent 1 tCO2e avouded, reduced, or removed | Represent 1 MWh or electricity generated with renewable |
| Type of Projects | A variety of nature technology based projects that reduce, avoid or remove GHG from atmosphere. | Renewable energy projects only |
| Additionality requirement | Always required - need to prove that the proceeds from the credit led to incremental climate actions | Not needed - RECs issued for electricity generation from RE sources to prove that one generates or consumes RE electricity |
| Addressable emissions | Can be used to compensate or neutralize all emissions from an organization's GHG inventory (Scope 1, 2 and 3) | Only to reduce an organization's emissions from electricity consumption (Scope 2 only) |
| Geographic boundary | May be sourced from anywhere in the world, unless a regulation defined otherwise (when used in a compliance system) | RECs are typically consumed within the same geographical region (e.g US, EU, Asia) where RECs are produced. |
| ITMOs | Yes | No |
| Consumption terminology | Retirement of credits | Redemption of RECs |
- * Internationally transferred mitigation outcomes under Article 6