In 500 words or less: Voluntary Carbon Offsets
Climate Complexity condensed in 500 words or less
Hi there!
I am back after a short two-week hiatus from my newsletter.
We get to be deliberate about the direction of our time and energies during some weeks. The rest of the weeks - despite best efforts - where our time and energies go seem to be pre-determined.
You hit reset when you can, and this week is that reset for me.
Most things in life is a fine balance between deliberate intent and surrendering to pre-determined plans.
On the subject of balance, (smoothest segue ever) …
… an offset is a consideration or amount that balances the effect of an opposite one.
This week’s post is about carbon offsets that balance the effect of emissions.
A carbon offset is a reduction or removal of emissions of carbon-dioxide or other greenhouse gases made to compensate for emissions made elsewhere.
There are a few ways emissions can be offset. Some examples of carbon offsets include:
Renewable energy projects
Energy-efficiency improvements in buildings and transportation
Storing carbon in soils or forests, including tree-planting
There are two types of offsets:
— Mandatory offsets where regulators/ governments tell companies to offset x% of emissions. Governments/ countries with functional carbon markets typically have national accounting standards that govern these.
— Voluntary offsets are for companies that wish to offset their emissions, well, voluntarily. These companies can pick offset projects that are verified by third-party standards such as the Climate Action Reserve (CAR), the Verified Carbon Standard (VCS), the American Carbon Registry (ACR) and Gold Standard (GS).
These offsets are also tracked on separate carbon registries so that they aren’t double-counted.
Now, why would companies buy offsets voluntarily?
One of two reasons (because you can’t do both)
Climate Leadership
Not a hot take.
Here’s why.
A startling <5% of carbon offset projects actually remove carbon-dioxide from the atmosphere.
Low quality carbon offsets and weak verification standards, together make for an insidious combination. Why? Because it gives the impression that emissions are being compensated for, when they actually aren’t.
Whether companies buying offsets are culpable or not is a bit difficult to judge, so here’s a quick rule of thumb.
How to tell if a company is greenwashing with its carbon offset strategy?
Companies that buy carbon offsets without making concerted attempts at cutting their emissions … it’s probably greenwashing.
How do we know whether a carbon offset is high quality or not?
They must check two boxes -
It must represent additional, permanent, and otherwise unclaimed CO2 emission reductions or removals
It should come from activities that do not contribute to social or environmental harm
But it is really difficult to verify this, isn’t it? Especially without a truly rigorous carbon accounting standard that doesn’t receive any monetary compensation for verifying offset projects.
Sounds a lot like what happened with the sub-prime mortgages and credit rating agencies, doesn’t it?
Except, it is our planet that will go belly-up.
The last word.
Cut emissions first. Offset what you cannot cut.
That should have been the order in which climate action should have worked.
Unfortunately, timing is a bitch. When the idea of carbon credits was floated back in the 1990s, there was little consensus on whether climate change was even real. So ‘friends of the planet’ aka climate action pioneers took a win and ratified carbon offset markets.
The situation is rather different (and very dire) now. And something’s gotta give.
If you look at any climate action plan, legitimate or otherwise, carbon offsets are almost always prefixed with ‘high-quality’.
However, high-quality isn’t the highest it can be. Most certainly, calling something high-quality doesn’t make it that.
Until (and even after) we see improvements in the quality of carbon offsets -
Cut emissions first. Offset what you cannot cut.
(I wrote an edition of Friday Climate Focus on The Crazy World of Voluntary Carbon Markets a few months ago. I exclusively used GIFs from Schitt’s Creek to do that. Check it out if you’d like. If nothing, the GIFs surely won’t disappoint).
Banter
Go Green or Go Home