UPSC Prelims 2011·GS1·geography·ecology and environment

Regarding “carbon credits”, which one of the following statements is not correct?

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Last updated 23 May 2026, 3:31 pm IST
  1. AThe carbon credit system was ratified in conjunction with the Kyoto Protocol
  2. BCarbon credits are awarded to countries or groups that have reduced greenhouse gases below their emission quota
  3. CThe goal of the carbon credit system is to limit the increase of carbon dioxide emission
  4. DCarbon credits are traded at a price fixed from time to time by the United Nations Environment ProgrammeCorrect

Explanation

Statement D is incorrect because carbon credits are not traded at a fixed price set by the United Nations Environment Programme. Instead, the price of carbon credits is determined by market forces of demand and supply, similar to any other financial commodity. While the United Nations framework provides the regulatory structure for carbon trading, it does not intervene in the pricing mechanism. Statements A, B, and C are correct. The concept was formalized under the Kyoto Protocol to provide economic incentives for reducing greenhouse gas emissions. Credits are indeed awarded for reducing emissions below a specified quota, and the ultimate objective is to mitigate climate change by limiting carbon dioxide emissions.
geography: Regarding “carbon credits”, which one of the following statements is not correct?
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