What is Carbon Offsetting?
Everyday people do dozens of things that put more carbon dioxide into the atmosphere. Carbon Offsetting is a financial instrument aimed at reducing carbon dioxide emissions. It allows you to compensate for unavoidable emissions that you create everyday (from driving cars, heating homes, flying etc) by allowing you to fund an equivalent carbon dioxide saving elsewhere in the world (1). One carbon offset (also called renewable energy credits) represents the reduction of one ton of carbon dioxide. Companies and governments buy carbon offsets in order to comply with caps on the total amount of carbon dioxide they are allowed to emit and to improve their green image. Individuals and businesses will also purchase carbon offsets to mitigate their own carbon dioxide emissions from electricity use, transportation and so on. For example, an individual may buy carbon offsets to compensate for the CO2 emissions created by their personal air travel. All official government air travel is being offset, and increasingly politicians are being urged to offset their private travel too. There are also many companies that offer carbon offsets during their sales process so customers can choose whether they wish to compensate for the emissions created with the product or service they are purchasing.
Offsets work typically by financial support being provided for projects that are seeking to reduce CO2 emissions, for example, renewable energy projects (building hydro-electric power stations, wind farms), energy efficiency projects, forestry projects (carbon sequestrian) etc. There are many different types of offsetting projects around the world, for example, introducing energy efficiency measures in India, harnessing river hydropower in Fiji or providing heat retention containers in Indonesia for cooking, heating, sterilising water and preserving food. In addition to reducing CO2 emissions, these projects also have social benefits such as creating jobs for the locals. Carbon Offsetting has become popular mainly among the West as consumers become more aware and concerned about the potentially negative environmental effects of green house gas emissions from energy-intensive lifestyles. Carbon offsetting is perceived as a cheaper and more convenient way to reduce one’s own carbon footprint (2).
It is important that projects funded through carbon offsetting are additional. In other words, reductions must be in addition to those that would have happened anyway, had the offset funding not been available. For example, if a project to install solar panels for electricity was sufficiently profitable to have gone ahead anyway using state or private funding, it should not count as an emission reduction project as the price of the credit will not accurately reflect the amount of GHG reductions it caused (3).
How to get involved in Carbon Offsetting
In order to offset your carbon emissions, it is first necessary to calculate how much emission you are producing at home and through the transport you use. This can be done using a carbon footprint calculator. You can then choose to offset some or all of your unavoidable emissions, for example, your car mileage for a year or a flight abroad. Then you can buy the equivalent amount of carbon credit from carbon dioxide saving projects that need funding. However, it is important to remember that you can also reduce the size of your carbon footprint by changing some habits such as walking instead of driving (also a healthier option), turning off your electrical appliances when not in use, turning down your thermostat and using energy-efficient light bulbs. Such changes will also lower your energy bills. Offsetting should therefore be considered for those emissions that cannot be avoided or reduced (4).
If you wish to carbon offset, it is important to look for the ‘Quality Assurance Scheme for Carbon Offsetting’ mark (set up in 2009) so you can be guaranteed a good quality offset. These requirements are set by the government and provide you with confidence that the offset provider will calculate your emissions accurately using approved factors, sell good quality carbon credits that comply with robust standards, cancel the credits within a year of you buying them and ensure the same credit is not bought twice. Offsets that do no carry this quality mark may not represent a real reduction in carbon emissions so it is important to check for it. The Quality Assurance Scheme for Carbon Offsetting is a government-led initiative aimed at increasing consumers’ understanding of the role of offsetting in tackling climate change and helping them to make informed purchase of good-quality offsets. It is hoped that this scheme will address public confusion and mistrust of carbon offsetting (5).
Moreover, your business could offer customers carbon offsets. This would create an additional revenue stream and meet the growing demands for carbon reduction solutions. The Carbon Neutral Company are the leading carbon offset brand and help companies take advantage of the customer demand for carbon reduction solutions. By partnering with Carbon Neutral it avoids the time and cost of developing your own carbon procurement team as they already have access to high quality, validated carbon credits from all over the world. Therefore, they allow businesses to go to the market quickly and credibly with an established carbon reduction offering (6).
The Controversies of Carbon Offsetting
Those who support carbon offsetting maintain that it leads to increased investment in renewable energy, energy efficiency and reforestation, reducing carbon dioxide emissions and thus addressing the root cause of climate change. Offsetting flights in particular makes a difference to CO2 emissions as they account for an enormous percent of the average household’s annual emissions.
However, it is argued that carbon offsetting is misleading and a way for guilty consumers to pay for absolution rather than changing their behaviour and is used by businesses as an excuse to pollute. It is thought that the tourism industry in developed countries uses carbon offsetting to justify growth plans on the basis that money will be donated to projects in developing countries. Moreover, Pan Ocean Oil Corporation applied for carbon credits in exchange for processing its own waste gas in Nigeria. Michael Kaprkpo from ‘Oil watch’ compared this type of carbon offsetting to a criminal demanding money to stop committing crimes. He maintains that this attitude to CO2 emitting sends out the wrong message (that you can buy your way out of a problem) and global targets to reduce CO2 emissions can not be met in this way. It discourages individuals and companies from cutting CO2 emissions in the first place (7). It prolongs damaging behaviour and is a distraction from the deep systematic changes that are needed to fight climate change.
In particular, the effectiveness of tree-planting projects for carbon offset purposes has been questioned by environmentalists for several reasons. Firstly, promised reductions in CO2 are paid for up-front despite the fact that trees take decades to mature; thus it takes many years for environmental benefits to be realised. Secondly, it is not guaranteed that the forests will not be mismanaged, burned down or cleared. Thus, the carbon in trees is temporary as it can always be released back into the atmosphere. Thirdly, some tree planting projects have introduced fast growing invasive species (in an effort to cut costs) and have ultimately reduced biodiversity. It is also difficult to calculate exactly how much CO2 is being saved. In addition, some projects have caused conflicts with indigenous people as their use of their forest is curtailed.
Furthermore, carbon offset providers have been criticised for profiting from doing very little and providing carbon reduction services that are exaggerated, misleading or worthless as they do not reduce carbon emissions. It has been suggested by some environmentalists that carbon offsetting does nothing apt from make you feel good and has been labelled the ‘carbon neutral con’ (8). Some offset projects may also have secondary negative effects. For example, hydro-electric projects funded by carbon offsetting may have negative environmental impacts preventing them from actually being built. Projects may also have negative social impacts, such as local residents being evicted from a national park to enable it to be marked off as carbon credits.
Moreover, many carbon reducing projects can not be proved to be ‘additional’. In other words, schemes are usually already part of a country’s development using widely-available technology. Thus, projects may have been undertaken regardless of funding from carbon offsetting. For example, a carbon offset project to build a hydro-electric power station in China does not consider that the Chinese government is a string supporter of hydro-electric development, that hydro is a major component of its five-year plans, and that the Chinese hydro-electric industry is expected to grow at an exceptional pace. Revenue from carbon offsetting could therefore be regarded as a bonus rather than the deciding factor (9).
Conclusion
Carbon Offsetting is certainly not the solution to global warming but perhaps it plays a part in the overall approach to carbon management. It can reduce the impact of your actions and raise awareness by putting an actual price on the carbon you emit. It allows companies and individuals to reduce their carbon footprint immediately in the most cost-effective, economically-efficient manner and emissions reduction projects funded by carbon offsetting helps communities in other parts of the world lead low carbon lives. Low carbon technologies are provided to people who can not afford it without the financial assistance from carbon offsetting. However, it must be remembered that it is important to take personal and organisational steps to reduce our CO2 emissions as much as possible and offset the remaining unavoidable emissions allowing you to become carbon neutral. Carbon offsetting does not relieve individuals, businesses or governments from the responsibility of further action; it should work in conjunction with other initiatives (10).
[5] www.offsetting.decc.gov.uk
[9] www.foe.co.uk
[10] www.news.bbc.co.uk
