In the past few years, the topic of climate change has worked its way into every area of our lives, and rightfully so. As we push closer to the irreversible effects of climate change and the ever-looming 2°C, companies, governments, and individuals are looking for every possible way to mitigate emissions.
Carbon offsetting was first conceptualized in 1989, but has been gaining traction in recent years. The basic idea of carbon offsets relies on the premise that companies can continue to release atmospheric carbon, so long as they absorb equal or greater amounts from the atmosphere to have net-zero emissions.
This article explains how carbon offsets work and examines their efficiency in fighting climate change.
When a company emits carbon dioxide—typically through oil and gas production, factory emissions, or shipping—they have the ability to mitigate their climate impact by purchasing offsets. Offsets refer to any method of absorbing carbon dioxide or reducing emissions. The most common form of carbon offset is planting trees, where companies use a portion of their proceeds to fund new tree plantings somewhere in the world.
While tree plantings are the most common, carbon offsets can take the form of any type of climate mitigation, including:
- Supporting wind and solar projects
- Conservation projects
- Sustainable farming and soil carbon absorption
- Community projects
- Waste to energy and other waste reduction projects
Carbon offsets help companies and organizations “cancel out” their carbon emissions with outside carbon sequestration projects that allow them to support other forms of carbon sinks and environmental conservation efforts.
One of the benefits of carbon offsetting is that many of these efforts take place in developing nations, effectively funneling money to some of the most vulnerable peoples and those most heavily impacted by climate change and pollution.
One of the biggest criticisms of carbon offsets as a means to fight climate change is that it is a form of greenwashing that distracts from the overarching systematic issues at the root of the climate crisis. For example, some companies may invest in carbon offsets without actually doing anything to lower their own emissions. Some argue that investing in offsets allows companies to put forward a false brand image as environmentally-friendly, while continuing to emit large amounts of carbon themselves.
However, carbon offsets have shown to help boost community efforts and fund renewable energy projects that are crucial in fighting climate change. Studies suggest that in order for carbon offsets to be truly effective, they must happen in addition to emissions reduction efforts, and not the sole form of mitigation by companies and organizations.
A significant advantage to carbon offsets is their ability to counter emissions that are difficult to reduce. Scope 3 emissions, or those that occur indirectly to a company’s actions, are incredibly difficult to address, as they happen in a company’s value chain and are therefore largely out of the organization’s control. While many companies use certifications and supply chain transparency to reduce their value chain impacts, these efforts are not always possible or fully effective. As an addition, carbon offsets and credits allow companies to address these impacts through outside climate efforts.
While many argue that carbon offsetting acts as a cop-out to reducing industrial emissions, many organizations struggle to address their Scope 3 climate impacts and fail to provide any form of mitigation at all. Carbon offsets may not be the perfect solution, but they offer a form of climate mitigation that otherwise may not happen at all.