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Carbon offsetting is a popular way for companies to mitigate their environmental impact and reduce their carbon footprint. However, it is crucial to understand that offsetting is not the solution to achieving net zero emissions. It is part of a much larger puzzle.
It works by investing in projects that reduce or remove greenhouse gas emissions from the atmosphere. These projects can include renewable energy and reforestation and are typically located in developing countries.Offsetting or purchasing carbon credits does not reduce your company's emissions. Instead, it deals with the emissions once they have entered the atmosphere.You do this by investing in projects that remove or reduce carbon dioxide from the atmosphere, such as renewable energy projects, reforestation, or carbon capture technology. By investing in these projects, the carbon reduction or removal is equivalent to the emissions produced, effectively "offsetting" them.
In short: After you have done everything else possible.Offsetting is a tool to balance out emissions that cannot be reduced further through operational improvements, redesign, and innovation. So you should do this after you have feasibly exhausted all routes of carbon reduction for that year.We like to think about it by seeing offsetting as an emissions tax. All aspects of your business are linked with emissions, and that's okay. As highlighted in our Carbon 101 article, our belief, aligned with Science Based Targets Initiative and other drivers in this space, is the following:
1) Measure - accurately capturing all info across Scopes 1, 2 and 3.
2) Analyse - Understand what your top emitters are, how this fairs to industry averages and where improvements (big and small) can be made.
3) Target - Set a reduction target, and ensure you are aligning with the Science Based Targets Initiative (the official Net Zero framework)
4) Reduce now make improvements across your business from your operations, offering, and supply chain. This may mean changing certain aspects like your partners, upgrading facilities, materials, and equipment, or even rethinking your overall business strategy.
5) Remove & Offset - Only after you have completed as much as possible annually from the above do you look to remove/offset.
Let's face it. No industry is currently in a position to be net zero if we look back to the Science Based Targets Initiative's definition. Significant innovations are required to get us into a place where this is truly viable.
Let's look at the aviation industry. They have pledged to be net zero by 2050. The main driver for this will development of sustainable aviation fuels(SAFs). This advancement is vital for the industry to reach its target, and no amount of offsetting will do this.
So the theory isn't a bad one. If you can't get rid of the emissions from the source, let's handle it after it's entered the atmosphere.Well, it's not straightforward as we don't have that much space.Taking some very broad assumptions regarding:- Total global carbon emissions at 40 gigatons CO2e- Offset through reforestation projects only- Carbon sequestration capacity of trees (various species sequester different amounts of carbon)- Forest growth rateTo offset 40 gigatons CO2, that's roughly what we produced in 2020 - we would need to reforest 2bn hectares - approximately the size of South America (yep, the one with the Amazon in it).
Treeplanting itself opens up a whole can of worms, watch this BBC report that looks into if planting trees really will help save the planet.
With the best will in the world, emissions will continue to grow, driven by developing nations, so even more space would be required if we focus on offsetting projects. The focus should be on ensuring we get to a minimal amount of emissions entering the atmosphere in the first place by focusing internally on reduction.
Being diligent when choosing an offsetting provider is vital, as this growing industry isn't as tightly regulated as the work warrants.All that being said, there are frameworks in existence that you should look for when choosing a provider:
Verified Carbon Standard (VCS): The VCS is an international program certifying emissions reductions from carbon offset projects. It sets standards for the methodology, calculation, and verification of emissions reductions.
Climate, Community, and Biodiversity Standards (CCBS): The CCBS are a set of standards that promote the development of high-quality carbon offset projects that deliver multiple benefits, including reducing greenhouse gas emissions, enhancing local communities, and conserving biodiversity.
Clean Development Mechanism (CDM): The CDM is a mechanism under the United Nations Framework Convention on Climate Change that allows developed countries to invest in carbon offset projects in developing countries to meet their emissions reduction targets. CDM projects must meet stringent standards to be eligible for certification.
Gold Standard: The Gold Standard is an international certification program for carbon offset projects that deliver high environmental and social benefits. Projects must meet rigorous standards and pass an independent third-party verification process to be certified under the Gold Standard.All our partners at Futureproof work to these standards. Find a provider for yourselves that do the same.
No, not yet.We've seen recently in the news that Verra - the most significant carbon credit provider and the administrator for the VCS standard, has had their rationale heavily question.In a Guardian article recently published in collaboration with the German weekly Die Zeit and SourceMaterial, they found damning evidence against Verra's model.
Based on analysis of a significant percentage of the projects, more than 90% of their rainforest offset credits – among the most commonly used by companies – are likely to be "phantom credits" and do not represent genuine carbon reductions.Verra has stood its ground and backed its REDD+ projects. REDD+ (Reducing Emissions from Deforestation and Forest Degradation) is a program under the United Nations Framework Convention on Climate Change (UNFCCC) aimed at reducing deforestation and forest degradation emissions in developing countries.
The program provides financial incentives to countries and local communities to reduce emissions from deforestation and forest degradation and promote forest conservation and sustainable management. They are implemented in different ways but typically involve a combination of policy, legal, and institutional reforms and technical and financial assistance to local communities and governments. The projects are designed to benefit local communities and the global environment by reducing emissions and promoting sustainable development.
If you choose a verified scheme, the offsetting you are doing is good - and is not greenwashing.Greenwashing is all about optics.If you claim that your products or services are good for the environment just because you offset and have made no advancements in improving your products' materials, supply chain, or life cycle, then you are greenwashing.Carbon offsetting can play a role in reducing a company's environmental impact. Still, there are also some downsides to the practice.
One of the main criticisms is that offsets are a way for companies to avoid reducing their emissions, effectively kicking the "single-use plastic bottle" a bit further down the road.Instead of investing in reducing their emissions at source, companies can purchase offsets and continue with their current business practices without making any changes. This mentality needs to change.Even after all of your due diligence, offsetting can be unreliable. The project you support may fail to achieve the emissions reductions they promise - as there are so many factors at play, and still question marks on methodology.
Offsetting plays a part in a net zero journey. Still, companies must prioritise reducing their emissions through operational improvements, redesign and innovation. We encourage you to offset on at least an annual basis, but doing so after you have done everything you can to reduce your emissions for the yearAdditionally, be more transparent. About your company's emissions, and actively engage with stakeholders to develop and implement strategies to reduce your environmental impact.
If you struggle with this, don't know where to start or simply want to understand more about how you can reduce your carbon footprint, look into our emission manager today. At Futureproof, we give your business everything you need to measure, analyse and reduce your carbon footprint. With an Emissions Manager, Net Zero Roadmap and Support from our expert team.
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