Meta Platforms Inc., the parent company of Facebook and Instagram, has announced its agreement to acquire up to 3.9 million carbon offset credits from the forestry sector of Brazilian investment bank BTG Pactual by the year 2038.
While the financial details of the deal remain undisclosed, Allied Offsets reported the average market price for forestry carbon offsets at $4.22 per credit last week.
Based on this pricing, the total value of the agreement could reach approximately $16 million, as noted by Reuters.
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Carbon offsets provide a mechanism for companies to balance their greenhouse gas emissions by funding initiatives that contribute to emission reductions elsewhere. Each carbon credit reduces one metric ton of carbon dioxide (CO2).
According to the agreement, Meta will first acquire 1.3 million credits from BTG Pactual Timberland Investment Group (TIG), with the option to purchase an additional 2.6 million credits later.
Meta has announced that this is its largest single-project carbon removal agreement, furthering its commitment to achieving net-zero emissions by 2030.
The carbon credits come from BTG Pactual’s restoration initiatives in Latin America, where more than 7 million seedlings have been planted.
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In June, TIG completed a significant sale of 8 million carbon credits to Microsoft, the largest carbon credit transaction to date.
However, despite these substantial deals, demand for carbon offsets has declined as companies such as Nestlé and Gucci have cut back on purchases due to concerns over their effectiveness in genuinely reducing emissions.