akar.earthRemoval credit: Definition
What is a removal credit? How carbon removal credits differ from avoidance credits, which Indonesian project types generate them, and why buyers pay more.
A removal credit is a carbon credit representing one tonne of CO2 equivalent physically taken out of the atmosphere and stored, for example in growing trees, soils or geological formations. It contrasts with an avoidance credit, which represents emissions that were prevented.
Why it matters
Net-zero frameworks distinguish between reducing emissions and neutralising what remains. Guidance such as SBTi’s corporate net-zero standard expects companies to use removals to neutralise residual emissions at net-zero. That makes removal credits strategically important to buyers with long-term net-zero targets, and they often trade at a premium. See our removals vs avoidance guide.
How removals are generated and measured
Nature-based removals come from:
- ARR: afforestation, reforestation and revegetation, measured through tree growth in plots and remote sensing, for example under Verra VM0047.
- Agroforestry: trees added to farms, such as shade trees in coffee and cocoa.
- Blue carbon restoration: replanting mangroves and restoring tidal wetlands, including soil carbon gains.
- Soil carbon: improved agricultural land management.
Engineered removals include biochar, direct air capture and enhanced weathering. Each type has different permanence and measurement challenges.
Indonesia angle
Most Southeast Asian nature-based issuance so far has been REDD+ avoidance. Indonesia accounts for 59.3% of regional NbS issuance, mostly from REDD+. That leaves a supply gap in high-quality removals. Indonesia has large areas of degraded land, abandoned aquaculture ponds suitable for mangrove restoration, and smallholder landscapes suitable for agroforestry. The challenge is measuring growth credibly across many small plots and managing permanence.
Common mistakes
- Calling REDD+ credits “removals” because they relate to forests.
- Ignoring reversal risk; removals stored in trees can be lost to fire or harvest.
- Assuming all removal credits meet the same permanence bar as geological storage.
Related terms
See avoidance credit, ARR and permanence, or explore the climate finance hub. For corporate land-sector targets, see SBTi FLAG.
Frequently asked questions
Which forest projects generate removal credits?
Projects that increase carbon stocks, such as afforestation, reforestation and revegetation (ARR), agroforestry, mangrove restoration and some improved forest management activities.
Are removal credits more valuable than avoidance credits?
They often trade at a premium because net-zero frameworks require removals to neutralise residual emissions, but price also depends on quality, vintage, co-benefits and rating.