Carbon Trading Business Idea
Carbon credit trading just might be one of the fastest growing industries in the new green movement. If you have no idea what it would mean to start a carbon trading business, you’re not alone.
With carbon credit trading, you’re not trading a tangible item. Instead, you’re offering to provide a method for companies to say that they are environmentally friendly when they can’t change their core operations to a more “green” method.
Companies purchase carbon credits from carbon trading businesses to offset the amount of greenhouse gases that their manufacturing processes create.
For example, a group of companies that make plastics agree that they will cut their emissions to the point where they only produce 10 tons of carbon a year within a two year period. Company A has the funds and expertise to start right away and finds that they are only producing 7 tons a year at the end of the agreed upon time.
However, Company B is late starting and finds they are pressed for time. At the end of the two year period, they are only down to 12 tons a year. Company B could purchase 2 tons of carbon credits from Company A to be found in compliance with the agreement.
When you start a carbon trading business, you will facilitate this type of deal. Other carbon trading businesses purchase carbon credits and sell them to third parties as an investment option. With the growth in this area, the carbon credit market may one day rival the stock market for investment opportunities.
How To Start A Carbon Trading Business
To start a carbon trading business, you can begin from your home or a small office. Location shouldn’t matter because most business can be conducted at a client’s facility or online. You should invest in a sophisticated website that explains carbon trading completely and allows either businesses or individual investors to buy and sell carbon credits.
You will need a method to record customer information and track transactions. Be prepared to issue carbon credit certificates or some other proof that someone has purchased carbon credits.
Because carbon trading is such a new industry, there is not a lot of regulation in this area. At this point, you won’t need a specific degree or certification to get started. However, you will need to sell yourself as an expert if you are buying and selling carbon credits directly.
If you choose to buy and sell from third parties that have already certified the carbon credits, this becomes less of an issue. Keep a close eye out for future regulation by groups like the Environmental Protection Agency.
Keys To Success With Your Carbon Trading Venture
Your ability to sell an intangible benefit will be the key to a successful venture when you start a carbon trading business. While many industrial companies will be interested in trading carbon units, most will continue to see it as either a money-making opportunity or a necessary evil.
Some will see it as a scam that they are being forced into by another group of environmental extremists. Be prepared for varying attitudes. Selling carbon credits to the general public as an investment vehicle may find clients with genuine interest in the environment, but it may also draw some protesters that think you are just selling a license to pollute instead of promoting conservation.
In short, carbon credit trading is a controversial topic, and you must be prepared with all the answers before facing your potential clients.
Where To Find Clients
Sources for potential clients are virtually endless with carbon credits. You can target various industries directly if you have a certain level of expertise in the business world, you’re a carbon expert, or you’re a slick salesperson.
For industries that haven’t been targeted yet, you may even be able to put together a carbon trading plan and sell them on a proactive approach to becoming environmentally supportive. Being able to put an environmentally-conscious endorsement on their marketing materials could be a big win for them.
You may even want to create an attractive seal of endorsement to use during your sales presentation. To buy and sell carbon credits as a third-party investment opportunity, you will want to make sure that financial advisors at all levels are aware that you are offering this option.
You could also advertise in environmentally-conscious publications in addition to creating a website that can be found by popular search engines.
Growing Your Business
To expand on a successful carbon trading business, you might want to become a consultant for some of the larger industries. This could involve evaluating their operations for improved emissions or testing their current emissions and recommending the number of carbon credits they should purchase or sell.
If you’ve concentrated on the third-party carbon trading area, you may want to expand into other investment options to become the primary financial advisor for your customer base. A new marketing company could be another growth opportunity if your carbon credit endorsement has been a successful tool for your clients.