1. Carbon Credits:
   • Carbon credits in the VCM represent a reduction or removal of one metric ton of carbon dioxide equivalent (CO₂e). These credits are generated through projects that either reduce emissions or remove carbon from the atmosphere.
2. Types of Projects:
   • Projects generating carbon credits can include reforestation and afforestation, renewable energy installations (like wind or solar power), energy efficiency improvements, methane capture, and sustainable agricultural practices.
3. Certification and Standards:
   • To ensure credibility and transparency, carbon credits are often certified by independent standard-setting organizations such as the Verified Carbon Standard (VCS), Gold Standard, and the Climate Action Reserve. These organizations verify that the emission reductions or removals are real, additional, measurable, permanent, and independently audited.
4. Participants:
   • The VCM involves a variety of participants including project developers, brokers, buyers (corporations, NGOs, and individuals), verifiers, and registries.
5. Motivations for Participation:
   • Entities participate in the VCM to achieve corporate social responsibility (CSR) goals, enhance their brand reputation, meet consumer or investor demand for sustainable practices, and prepare for potential future regulations.
6. Market Dynamics:
   • The VCM is characterized by flexible and voluntary participation, which can result in variable pricing and demand for carbon credits. Prices can fluctuate based on factors such as project type, location, verification standard, and buyer preferences.

Project eligibility for the voluntary carbon market depends on which standard is applied.  However, typically, the eligibility criteria are similar to those of the CDM project eligibility criteria:

1. Reduction in GHG Emissions covered by the Kyoto Protocol (CO2, CH4, N2O, SF6, HFCs, PFCs)

2. Contribution to Sustainable Development of Rwanda

3. Additionality (demonstration that the project would not have happened without the incentive from carbon credit revenue)

4. Emission reduction must be real, measurable, and long term

5. Sector must be eligible (eligible project types are standard dependent)