> For the complete documentation index, see [llms.txt](https://docs.greenearth.finance/greenearth.finance/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.greenearth.finance/greenearth.finance/net-zero-by-2050/carbon-credits/project-lifecycle.md).

# Project Lifecycle

## Overview

The current process to generate carbon credits is lengthy and opaque. As a result although the credits are of dubious quality,  the lack of supply makes it a sellers market. 

It can take years to get revenue for credits because these credits are not generated until long after the climate-positive activity has taken place. For nature-based credits, the type that has the most scaling potential, it can take up to 5 years for credits to be issued. 

## Current Process

A company or project that wishes to create and sell carbon credits first needs to appoint a **third-party auditor** to verify the validity of their emissions reductions. Each credit typically represents one metric ton of carbon dioxide removed from the atmosphere. Once the carbon reduction is confirmed, the business can easily sell its excess credits using in a credit. This trading mechanism incentivizes businesses with low emissions production while penalizing those with high emissions production.

<figure><img src="/files/iXUTjeE0BRxz1Lbwm6Sf" alt=""><figcaption><p>Source : Toucan.Earth</p></figcaption></figure>


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