Although the very first carbon offset project was voluntary, 2 much of the work to establish real markets for carbon offsets has been done in the context of designing regulatory programs. Many experimental carbon offset projects were undertaken in the 1990s, for example, in order to inform negotiations under the Framework Convention on Climate Change about the design of an international GHG emissions trading system. Experience from these projects led to the creation of the “Clean Development Mechanism” (CDM) under the Kyoto Protocol, which now constitutes the largest functioning market for carbon offsets. Through the CDM, emission reductions in developing countries.
