Appendix A: Glossary of Key Terms

A well-drafted Offtake Agreement must rest on a shared vocabulary. The following glossary provides neutral definitions of terms that frequently appear in negotiations and protocols.

Additionality: The principle that a project's removals would not have occurred in the absence of the Offtake Agreement or equivalent incentive.

Baseline: The counterfactual scenario of emissions that would have occurred without the project.

Buffer Pool: A reserve of CDR credits set aside to cover potential future reversals, typically managed by a registry.

Carbon Removal Credit: A unit representing one metric ton of CO₂ removed from the atmosphere and durably stored.

Carbon Removal Offtake Agreement: A contract between a buyer and supplier for the future purchase of CDR credits.

Carbon Removal Unit (CRU): Another term used by some registries for a verified CDR credit of one metric ton of removal.

Corresponding Adjustment: A national accounting mechanism under the Paris Agreement to prevent double-counting when CDR credits are transferred across borders.

Fungibility: The degree to which CDR credits are interchangeable across projects, pathways, or registries.

Leakage: Emissions increase outside the project boundary caused by project activities.

Life-Cycle Assessment (LCA): A method for quantifying net emissions by including upstream, operational, and downstream impacts.

Monitoring, Reporting, and Verification (MRV): The system for tracking project performance and confirming removals.

Permanence: The expected duration that the removed CO₂ will remain stored.

Registry: An independent platform that issues, tracks, and retires CDR credits.

Remedies: Contractual responses to non-performance, such as substitution or liquidated damages.

Right of First Offer (ROFO) / Right of First Refusal (ROFR): Buyer's preferential rights to future CDR credits from a supplier.

Verification: Independent confirmation by a third party that reported removals meet the protocol's requirements.