Four ways an inset credit moves capital through a value chain

This diagram shows the four roles an inset credit can play around a single decarbonisation project, in this case a vessel upgrade.

Upstream energy suppliers and downstream industries can co-finance the project and share the resulting reductions. Lenders and investors can use pre-purchased credits to de-risk it, because part of its future revenue is contracted before the asset is built. Buyers can procure verified reductions for their own Scope 3 inventory, and surplus credits can be traded with other companies that need them.

That makes a sustainability project more than a goodwill effort. The emission reduction becomes a financial instrument, one that can unlock projects no single balance sheet would fund on its own.