Frequently Asked Questions

Q: What is the Carbon Cycle?

A: The carbon cycle is the circulation and transformation of carbon back and forth between living things and the environment. Carbon is an element, something that cannot be broken down into a simpler substance. Other examples of elements are oxygen, nitrogen, calcium, iron, and hydrogen. Carbon compounds are present in living things like plants and animals and in nonliving things like rocks and soil. Carbon compounds can exist as solids (such as diamonds or coal), liquids (such as crude oil), or gases (such as carbon dioxide). Carbon is often referred to as the “building block of life” because living things are based on carbon and carbon compounds.

Source: Tribal Energy and Environmental Clearinghouse – Office of Indian Energy and Economic Development

Q: What is CO2?

A: Carbon dioxide (CO2) is a gas composed of one atom of carbon and two atoms of oxygen. CO2 occurs naturally in the atmosphere, is essential to plant life and, as a greenhouse gas (GHG), helps create the greenhouse effect that keeps our planet livable. CO2 is exhaled by humans and is used to put the bubbles in
 soft drinks, as a coolant (dry ice), and in fire extinguishers.

Q: What is Terrestrial Sequestration?

A: Terrestrial sequestration involves the capture and storage of carbon dioxide by plants and the storage of carbon in soil. During photosynthesis, carbon from atmospheric carbon dioxide is transformed into components necessary for plants to live and grow. As part of this process, the carbon present in the atmosphere as carbon dioxide becomes part of the plant: a leaf, stem, root, etc. Long-lived plants like trees might keep the carbon sequestered for a long period of time. Once the tree dies, or as limbs, leaves, seeds, or blossoms drop from the tree, the plant material decomposes and the carbon is released.

Carbon Dioxide Sequestration

Q: What land management practices promote Terrestrial Sequestration?

A: Practices that support terrestrial carbon sequestration include habitat restoration, reforestation, and no-till farming. Terrestrial sequestration is emerging as a viable business opportunity for landowners and offers an immediate response to the threat of global climate change.

Best Management Practices

U.S. Department of Agriculture

Natural Resources Conservation Service: Incentive Programs and Assistance for Producers

Q: What are Carbon Credits a.k.a Greenhouse Gas Offsets?

A: The term “carbon offset” is used generically to refer to a ton of carbon dioxide equivalent (CO2e). An offset negates the effects of carbon emitted in one place by avoiding the release of a ton of carbon elsewhere or sequestering a ton of CO2e that would have otherwise remained in the atmosphere.

Q: What project standards do I need to follow to develop carbon credits?

A: A terrestrial sequestration or emission reduction project is implemented on a specific tract of land. The sequestered amount of carbon or reduced emissions is measured, verified, monitored and reported according to specific guidelines and protocols for either a voluntary registry or trading system.

American Carbon Registry
Climate Action Reserve
Verified Carbon Standard
California Air Resources Board

Q: What is Cap-and-Trade?

A: Emissions allowance trading occurs when an emitter wants to voluntarily reduce its emissions or is forced to reduce emissions as a result of a cap-and-trade system, which places maximum limits on the amount of greenhouse gases an emitter or business sector may emit. Cap-and-trade systems force an emitter to purchase additional emission allowances from another emitter that is not emitting its maximum allocation of gases, or to mitigate its excess emissions by buying or generating greenhouse gas offsets from a project that is reducing emissions through some activity, such as agriculture, forestry, or injection of carbon dioxide underground.

Source: Oklahoma Conservation Commission – Carbon Sequestration Certification Program

Click here for our glossary of terms.


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Carbon credit projects use land management practices that boost the ability of natural CO2 sinks like plants and soils to remove carbon as CO2 from the atmosphere. Opportunities for indirect sequestration are found in forests, grasslands, wetlands and croplands.

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Carbon credit trading is a cost-effective solution toward mitigating environmental pollution that originated under the first Bush administration’s efforts to reduce acid rain.


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Carbon credits in North America are currently traded on voluntary offset markets and through regional GHG compliance programs. Prices for carbon credits are higher in compliance programs because there is greater demand for credits from regulated entities.