Carbon Offset - Does It Really Work And Reduce CO2 Emissions?
AuthorJustyna Weronika Łabądź
A carbon offset is a way for individuals and organizations to reduce emissions of CO2 and other greenhouse gasses by investing in ecological projects that mitigate emissions in another part of the world. The goal of every carbon offsetting is to become carbon neutral or reduce negative climate impact by the entity.
- The offsetting process. Calculate your carbon footprint, choose a carbon offset project, and purchase carbon credits.
- Variety of accessible carbon reduction projects. From renewable energy, through planting trees to landfill gas destruction.
- Verification. An important factor while choosing offsetting projects.
- Controversy. Why it is still debated and how to check its reliability.
- What else can we do? How to prepare an efficient offsetting strategy.
- Wide-angle look at emissions. Compensate for the digital carbon footprint.
Table of contents:
Ecologists and activists set alarm bells ringing, not from today. On television and the Internet, we see dramatically melting and disappearing glaciers, raging storms, fires, droughts, and climate change affecting almost all people around the world. It is widely known that by 2030, we must decrease emissions by half to limit global warming to 1.5 degrees, as specified in the Paris Agreement.
We can live more eco-friendly, follow a zero-waste philosophy, reduce or resign from meat eating, and change a car for a bicycle. And all those actions will be good, no doubt. But at the same time, we can't cheat ourselves that it is fine, and we did everything we could. The truth is we cannot completely eliminate greenhouse gas emissions. In many activities, both as companies and as individual consumers, we inevitably, for now, have to use the fossil fuels that power the entire world.
Fortunately, both individuals and companies can join climate action, slow down the increase in carbon dioxide emissions, promote a responsible approach to environmental protection, and always do something positive for the planet. One such activity is carbon offsetting.
What is a carbon offset?
Each activity, product, service, or person has its carbon footprint. Whether it's a banana that travels across an ocean to the local store, watching new TV series for an hour on a streaming platform, or simply all the population living in Canada - all those have their carbon footprint. Simply put, it is the amount of CO2e associated with its activity while used, produced, and acted. Every day tons of carbon dioxide equivalent (sometimes unified and shortened to one gas name of CO2) are released into the atmosphere, negatively impacting climate change and causing global warming.
However, there are ways to lower emissions on business and personal levels. One of them is called carbon offset, which describes removing, reducing, or neutralizing the number of produced greenhouse gasses (GHG). It happens by supporting certified ecological projects or organizations that are used to balance carbon emissions generated anywhere. Many schemes for carbon offsetting exist that focus on tree planting, protecting forests, and supporting and funding programs with renewable solar or wind energy.
Individuals and companies can use carbon offset credits to reduce carbon emissions and neutralize or minimize their negative environmental impact by purchasing carbon offset credits of a value corresponding to their emissions.
How does carbon offsetting work?
Carbon offsetting is an increasingly popular way for individuals and businesses to help combat climate change, but it can be unclear how it works. Here is a brief guide on carbon offsetting that describes each step of this climate action:
1) Carbon footprint calculation
Once the individual or company decides to offset their carbon emission, they need to calculate its impact and measurable carbon footprint. There are several ways to do it. One can use the separate website of organizations to do it, sometimes connected with the possibility of purchasing offsets. We can mention a few of them:
- Carbon Footprint - for individuals, small or large businesses, and products
- Footprint Calculator by WWF - for individuals
- The Nature Conservancy - for individuals
- Compensate - for individuals and companies
How do they calculate it? For example, a personal carbon footprint calculator will analyze elements such as:
- your lifestyle;
- ways of traveling and transporting,
- type of diet, energy, and heating used at home,
- place of residence,
- consumption habits,
- cars owned, etc.,
and convert it into the total amount of carbon dioxide produced by them.
In the case of companies, the footprint will be determined based on the following:
- direct CO2 emissions controlled by the company, such as the number of company cars owned and used.
- indirect emissions related to the amount and type of energy used, heating or cooling system.
- indirect emissions include items purchased through the company's value chain, business travel, and daily commutes.
2) Choosing the offsetting organization
After determining the amount of generated CO2e and choosing if we want to offset the whole or just a part, we can purchase carbon offset from a certified and verified organization specializing in projects that are good for the environment and promote positive change. Organizations offer different options to buy them, for example, monthly or for the whole year.
It is crucial here to search and choose certified and verified organizations. They can conduct projects that reduce emissions both with long-term and short-term perspectives. For example, they work on carbon sequestration by carbon storage (CCS), reforestation, renewable energy, or waste management projects. Their actions limit the CO2 released into the air, promoting sustainable development and alternative approaches to using natural resources.
Sometimes, people can get information about their footprint from the offsetting provider. For example, it happens in the case of carbon offsetting flights. The aviation industry is treated as one of the most polluting and impacting carbon emissions, responsible for about 2-4% of them globally. Therefore, airline companies often offer their clients and passengers the possibility to pay extra money to reduce their impact by funding offsetting projects worldwide.
3) Purchasing carbon offset credits
By carefully calculating the amount of carbon dioxide, an individual or a company can buy a carbon offset from them, measured and called carbon offset credits. Those credits are the units of greenhouse gas reduction achieved through their emissions reduction projects and are commonly traded on carbon markets. Simply put, individuals or businesses can buy these credits to offset the emissions generated from their activities, effectively balancing out the emissions and reducing their overall GHG emissions.
The emissions reductions are verified and quantified, and each credit represents a specific reduction in emissions.
There is a difference between each carbon offset scheme in terms of calculations - some are much more comprehensive than others. The framework "a ton is a ton" is applied in most cases.
4) Getting proof that your offset is real
At this step, it is crucial to ensure that the offset credits come from credible, verified carbon finance programs to ensure that the emissions reductions are real, permanent, and not double-counted and that organizations offer high-quality offset. That's why once you purchase carbon credits to offset your CO2 emissions, an organisation selling carbon credits should provide you with an official certificate with a unique serial number.
5) You're done with offsetting your current carbon footprint, but that shouldn't be the end of your action!
Once you are offsetting carbon emissions, of course, you can be proud of yourself. The money goes directly to your chosen project and will be used for tree planting and developing other sustainable solutions. Enjoy this moment of satisfaction... and think about taking the next actions when possible! Sharing your positive actions does not have to be an expression of pride, but the need to promote good and valuable solutions and inspire others to similar activities. So promote your certificate, offsetting carbon projects, and set the following steps to reduce your environmental impact.
What are the types of offset projects?
Numerous projects around the world offer carbon offsetting with their activities. And it is pretty challenging to become one of them. First, they must demonstrate that they will measurably mitigate emissions. The project must be well documented and have a way to verify that all claims are being met. Depending on the type of project, these procedures can be expensive. However, they are essential for concluding that carbon offsets are indeed lowering CO2 levels.
In addition to reducing carbon emissions, many CO2 offset projects also provide other benefits such as biodiversity, education, energy savings, jobs, food security, health, and well-being of local communities in developing countries.
We can mention several main types of offset providers:
- Renewable energy projects. They invest in clean energy sources such as wind, solar, geothermal, or hydropower, replacing fossil fuels and reducing greenhouse gas emissions.
- Energy efficiency projects. They focus on reducing energy use by improving building insulation or upgrading to more energy-efficient appliances and machinery.
- Reforestation and afforestation projects. They involve planting new trees to absorb carbon from the atmosphere and store it in biomass.
- Agricultural projects. They focused on reducing emissions from agriculture and livestock farming, such as improving soil management, reducing manure emissions, and increasing the carbon stored in soils.
- Landfill gas capture and destruction. Landfills emit methane, a potent greenhouse gas that can be captured and burned to generate electricity.
- Destruction of industrial gasses (e.g., HFCs). These projects focus on reducing emissions from industrial processes, such as improving manufacturing efficiency, reducing emissions from cement production, or switching to low-carbon fuels.
- Transportation projects. They focus on reducing emissions by promoting public transportation, electrifying fleets of vehicles, or improving fuel efficiency in the transportation sector.
Each type of project offers unique opportunities to reduce CO2e and mitigate the impacts of climate change. Offset projects can be located in different countries, with varying levels of participation from local communities and with different levels of transparency and monitoring.
That's why it is crucial to consider various criteria to offset credit validity and quality before investing money in them. Poor quality offsets pose a reputational risk, so it is essential that offsetting provides the desired additional environmental benefits.
Does carbon offsetting really work, and how to verify it?
To ensure the validity and impact of carbon offsets, it is crucial to use verified projects with high quality carbon offsets. They should follow international standards like the Verified Carbon Standard (VCS) or the Climate, Community, and Biodiversity Standards (CCBS). These programs verify the accuracy of the project's emissions reductions and offset calculations.
It is also important to consider where the project that issues carbon credits is settled and if it is not harming local societies, pushing them, for example, to leave their houses and areas to use them for "ecological" activities.
It is also crucial to monitor and verify the projects to ensure that the emissions reductions that they work on are real, permanent, and not double-counted. One can do this through regular reporting, site visits, and audits. Furthermore, companies and individuals should choose projects that meet their own environmental and social criteria (for example, biodiversity) and include these climate actions in the wider offsetting strategy.
The final goal of carbon offset is to reduce your negative impact and protect the planet's future. Using carbon offsets can work positively to reduce emissions that occur while we work, produce, generate new things, and exist. GHG emissions won't disappear. Still, as Bill Gates writes, carbon offsetting used by companies can decrease the harmful effect on the planet and also encourage others to take the same actions:
Of course, investing in companies doesn't make my carbon footprint smaller. But if I've picked any winners at all, they'll be responsible for removing much more carbon than I or my family is responsible for. Besides, the goal isn't simply for any one person to make up for his or her emissions; it's to avoid a climate disaster. So I'm supporting early-stage clean energy research, investing in promising clean energy companies, advocating for policies that will trigger breakthroughs throughout the world, and encouraging other people who have the resources to do the same.
Bill Gates, "How to avoid climate disaster," 2021
Furthermore, if you want your action to be reliable and adequate, you must regularly monitor your current emissions and adjust their offsetting to ensure they are properly balanced.
The controversy around quality carbon offsets
However, carbon offsetting can be a part of the positive approach of companies and individuals, it is still widely debated, and there is much controversy around this topic and the reliability of offsetting actions. Here are some of the arguments around carbon offsetting:
- Additionality: Some critics argue that carbon offsets may not result in new emissions reductions and that the credits offered on the offset market may not reflect real and permanent reductions in emissions. This can lead to "double counting" of emissions reductions, where the same emissions are reduced multiple times through different offset projects.
- Verifiability: There are concerns about the reliability of the methods used to quantify emissions reductions and the accuracy of offset project monitoring and reporting. Some critics argue that carbon offset credits may be fraudulent or overstated, and without the scheme, it will be challenging to recognize high-quality offsets.
- Leakage: Some offset projects may shift emissions from one location to another rather than reducing them altogether. This is known as "leakage" and can undermine the effectiveness of offset projects.
- Equity: Some argue that carbon offsetting can be unfair and can be treated as a kind of "greenwashing," as it allows developed countries and industries to continue emitting high levels of greenhouse gasses while offsetting emissions through projects in developing countries.
- Effectiveness: There is debate about the overall effectiveness of carbon offsetting and its climate benefits. Some argue that companies can use offsets to delay real emissions reductions and that they may not be enough to address the scale of the problem. For example, forest carbon offset can be difficult to calculate, as newly planted trees cannot be as efficient as they would be mature. Trees achieve their average carbon storage capacity when they are between 15 to 35 years old. And the current need for carbon offsetting credit should be much bigger, as we experienced the impact of carbon releases 60 years ago when the global economy wasn't as developed as it is now.
These controversies highlight the need for rigorous and transparent standards for voluntary carbon markets and oversight of buying offsets programs to ensure that they effectively reduce emissions and mitigate the impacts of climate change.
What can businesses do more for carbon emission reduction?
Companies and entrepreneurs can take the following steps to reduce their carbon emissions:
- Conduct energy audits to identify energy-saving opportunities.
- Implement energy-efficient technologies and processes.
- Switch to renewable energy sources.
- Purchase green energy or carbon offsets.
- Promote popular types of projects to produce carbon offset.
- Encourage and educate employees to reduce energy use and waste.
- Consider your digital carbon footprint by changing your website and its hosting to be more sustainable.
- Use video conferencing and other digital tools to reduce travel.
- Optimize supply chain and logistics to minimize emissions from transportation.
- Invest in research and development of clean technologies.
- Advocate for climate-friendly policies and regulations.
- Report emissions publicly and set targets for reduction.
- And last but not least. Promote your approach around your business network, publications, ads, and public presence. Make your attitude and strategy trendy, even if you joined it from other eco-friendly purposes and goals. No matter what brought you to this point. Always do more than you can imagine to support climate movements and create positive change. By them, you can inspire others to follow you in similar actions and increase global impact.
How about a digital carbon footprint?
Now, look at the bigger picture of carbon emission, including something seemingly intangible - digitality. We at Dodonut pay special attention to the digital carbon footprint produced by the creation and use of websites, which most of the public is unaware of, and whose size is similar to that currently produced by the aviation industry.
A digital carbon footprint refers to the greenhouse gas (GHG) emissions generated by using digital technologies, such as computers, servers, and data centers, as well as the production and disposal of electronics. This includes emissions from electricity generation, manufacturing, and transportation of digital devices, as well as emissions from data storage and transmission.
A digital environmental impact can be significant, as digital technologies are rapidly increasing and consuming more energy. By understanding and measuring emissions that come from digital activities, individuals and organizations can take steps to reduce their emissions and minimize their impact on the environment.
That is why it is so important for us to promote a broader view of our business, and to act accordingly, because in this area we can do a lot and accurately calculate the effect of our activities through calculations, for example, available on our website.
Tackle climate change by becoming carbon neutral
Carbon offsetting can significantly reduce global carbon emissions and address climate change, but it is not a silver bullet solution. Offsetting only addresses emissions from a specific source and does not reduce overall emissions. It must be part of a larger, comprehensive strategy to be effective. Presently, the necessity of a broader perspective was emphasized by Katharine Hayhoe from The Nature Conservancy:
So, in a nutshell, when people ask me what they should do, I say: Do something, anything, but then talk about it. The only way to bring the carbon footprint of everybody in rich countries to where it needs to be for a sustainable planet is to change the system, and to change the system, we have to use our voice.
Katharine Hayhoe, chief scientist for The Nature Conservancy and a professor at Texas Tech University
To sum up, carbon offsetting can be a helpful tool in the fight against climate change and a way to reduce a negative environmental impact. However, buying carbon offsets will only solve climate change if leading carbon emission producers commit to carbon neutrality. Therefore, we should all aim to achieve carbon neutrality or net zero emission by balancing the amount of greenhouse gas emissions produced and the amount removed from the atmosphere. Still, it should be coordinated with wider continuous actions not to be treated by the public as "greenwashing" and a tricky marketing campaign, but as an aware and well-thought step to saving our planet from climate disaster.
Gates Bill - "How to avoid a climate disaster?", 2021
Berners-Lee Mike, The Carbon Footprint of Everything, 2022
Berners-Lee Mike, How Bad Are Bananas, 2011
Extinction Rebellion, This Is Not a Drill: An Extinction Rebellion Handbook, 2019
Carbon Offset Guide, https://www.offsetguide.org/
Gurgel Angelo, Carbon Offsets, MIT Climate Portal, Updated November 8, 2022
Mulvaney Kieran, What is a carbon footprint—and how to measure yours, June 24, 2022
Brown Vicki, Carbon Offsets Do Not Work, Responsible Travel
This article emits ~0.04g of CO2.