What is carbon offsetting?

A growing number of organizations, cities, and even entire countries are talking about becoming carbon neutral. And many such plans are likely to have one thing in common – the presence of a carbon offsetting.

In the bid to be carbon neutral, offsetting can play a valuable role. But what is it and how does it work?

You can calculate your carbon footprint by analyzing how your activities generate CO2. Everything from lighting and heating to the data centres that host your business software, right through to the ink and paper for your printers. And, of course, your business travel. It all adds up.

The more you can do to reduce your carbon footprint the better, obviously. But there will almost certainly be a point where you’ve done all you can but are still leaving a mark. If you work in a large office building, for example, it’s unlikely you’ll have any say over who provides the electricity.

That’s the point at which you might decide to buy into an offsetting scheme to neutralize the effects of your remaining CO2 emissions.

A few years ago, that probably would have meant planting trees or investing in a reforestation project. Now you can buy carbon credits to establish an ongoing programme of carbon offsetting, so that for every action – a new division or building, a new fleet of vehicles, or a flight and so on – you simply buy more credits to cancel out your emissions.

Those credits are related to a wide array of environmentally friendly projects, such as protecting the Amazon rainforests, or providing renewable electricity to communities in developing economies.

It’s possible to get involved with carbon offsetting schemes at an individual level too.

Anyone wishing to use renewable electricity would usually shun traditional energy firms and look for a supplier using wind, water or solar energy. So far so obvious – at least it used to be.

Now there are traditional energy suppliers that will sell you carbon offset energy. In essence, for every unit of coal or gas energy, the company will pay for a unit of “green energy” to be generated somewhere else.

Offsetting is taking hold in the air travel industry. Now, it’s possible to pay a bit more for your plane ticket and offset your flight, although only around half of all airlines offer this option and only around 1% of passengers opt for it when offered.

You still get on the plane, it still flies and there are still CO2 emissions, but somewhere else in the world an action is taken to offset them.

Therein lies one of the problems with carbon offsetting – on its own, it won’t do much to reduce the volume of emissions being generated. Yes it will do something that absorbs carbon in the future, or that helps someone else reduce their footprint. But the best it can hope for is to prevent an overall increase.

It’s an approach that some say might even cause people to disassociate themselves from the issue and deflect attention from the immediate dangers posed by climate change.

Some of offsetting’s critics have been particularly vocal. Greenpeace describes it as paying lip service to action, saying: “When compared to ideas like frequent fliers paying more and more heavily for trips abroad, carbon offsetting transport falls very short.”

In 2016, the Institute for Applied Ecology also called the practice’s effectiveness into question when it analyzed the Clean Development Mechanism. That’s the platform that made it possible for green projects in developing countries to earn carbon credits, each equivalent to one tonne of CO2, which could be traded and used by industrialized nations to help meet their emissions reduction targets.

Its findings make for gloomy reading. “Overall, our results suggest that 85% of the projects covered in this analysis and 73% of the potential 2013-2020 Certified Emissions Reduction (CER) supply have a low likelihood that emission reductions are additional and are not over-estimated,” the Institute says.

“Only 2% of the projects and 7% of potential CER supply have a high likelihood of ensuring that emission reductions are additional and are not over-estimated.”

Despite this, carbon offsetting is likely to play a major role as part of wider global emissions-reduction strategies.

Ensuring it works will call for smart solutions to make offset projects more effective, while still encouraging people and organizations in the developed world to make efforts to tread lightly and reduce their carbon footprints.