More businesses are beginning to use carbon offset programs in recent times. But what is carbon offsetting, how does it work and what are the pros and cons? This article will give you all the information you need.
What Is Carbon Offsetting?
The term carbon offsetting means to buy carbon credits that compensate for any carbon emissions that have been created by yourself. An example could be buying carbon credits that are the equivalent of carbon emissions that are emitted while travelling on a plane. The money from purchasing carbon credits is used to reduce carbon in the atmosphere through different methods.
Carbon offsetting is putting money towards projects that decrease the amount of carbon in our environment, balancing any carbon emissions you have emitted. It is doing your part to protect our planet and help to reduce the rise in global warming.
We are seeing companies investing in reducing carbon levels becoming a lot more popular. United Airlines recently invested over $16 billion to replace all of their airlines with better fuel-efficient models and at all of their parks, Disney uses zero net direct greenhouse gas emissions with a zero-waste policy.
|Companies That Have Bought Carbon Offsets|
|Tokyo Olympics 2020|
Pros of Carbon Offsetting
We are facing a global problem with climate change and everyone needs to step up and take action. It will take more than just government help, but companies and investors can help through carbon offsetting projects. Some of the benefits of carbon offsetting are:
Saving Species From Extinction
With global warming, we are seeing many plants and animals becoming more vulnerable to extinction as their natural habitat is constantly being changed. By offsetting carbon, we are reducing the impact we have on these species, as some of the projects you can support aim to protect endangerment and extinction. Taking action now can prevent irreversible harm before it is too late.
Can Improve Business
Showing that you care for the environment and are making a conscious effort sends a statement out to customers that you’re doing your bit to save the planet. In France, 67% of consumers said they would prefer seeing a recognisable carbon footprint label on products. Another stat is that 75% of shoppers in France would feel better about purchasing from companies that have reduced their carbon footprint.
Easier Than Reducing Carbon Footprint
Purchasing carbon offsets can be a lot easier than making the effort to reduce your carbon footprint. Reducing carbon footprint levels can be tough, for many companies, driving cars is an unfeasible way to decrease carbon levels. If you own a company that emits a lot of carbon emissions, it can be extremely difficult to reduce emissions without losing production levels.
Improves Public Image
By using carbon offset programs, companies can see an improved brand identity and increase opportunities to strengthen their public image. For many companies, they are seen as being very carbon-heavy and eco-unfriendly. By changing the public’s perception of a company, they may see profits rise and more customers wanting to work with them.
Pressures Industries To Be More Eco-Efficient
If we see larger companies using carbon offsetting, then it puts pressure on their competitors and other large industries to also commit to carbon offsetting. There is an incentive to be more eco-friendly and as we’ve mentioned it can drive more customers. Companies are always looking for an extra edge to beat other businesses in their niche, so by carbon offsetting, they can add that to the list.
Improves Renewable Energy Technologies
With an increase in more companies using carbon offsetting programs, we will likely see an increase in better renewable energy technology. More projects in the renewable industry will be funded. Some of these initiatives include wind turbine installation, setting up solar panels and more research into how we can be more efficient with energy.
Simple Way To Offset Carbon
As it is simple to join a carbon offsetting program, it is an easy way to compensate for emissions and their effect on the planet. It doesn’t require a lot of effort and the benefits for your company can be huge, let alone the positive impact it will have on the environment.
Cons of Carbon Offsetting
Doesn’t Exactly Reduce Carbon
When you purchase carbon offsets, you’re only neutralising the carbon that is present in our atmosphere. To truly make a difference, as a planet we need to start reducing carbon levels to impact global warming. It is a start, but to reach the UK’s target of being net-zero by 2050, more action is needed.
Product Prices May Increase
Unfortunately for customers, product prices may rise due to carbon offsetting measures. Many manufacturing methods produce a lot of carbon and therefore the products made from these methods will cost more. Customers will see a rise in more expensive products that are made by methods that have high levels of greenhouse gas emissions.
Some Companies May Produce Even More Carbon Emissions
With companies just paying to compensate for their carbon emissions, they may produce even more carbon if it is profitable. As carbon offsetting only neutralises the amount they produce, they may not care how much carbon they emit. We need to reduce the amount we emit, not increase the levels, so in some ways, carbon offsetting gives companies a reason to say they’re doing their part, when in reality, they aren’t.
May See A Decrease In Profits
Companies that are competitive in a niche industry may be affected by carbon offsetting projects. This is particularly important in companies that use methods that involve high greenhouse gas emissions. If they decide to work with carbon offsetting programs, they may fall behind in comparison to their competitors and may see a fall in profits as others rise above them.
Some Companies May Not Invest In Carbon Reduction
By purchasing carbon credits, some companies may see that as enough for their eco-friendly contribution and lead to them not decreasing carbon emissions. We may see some businesses not investing in clean energy and just use their carbon credits as a way to show their efforts.
May Result In A Decrease In Jobs
With more carbon offsetting projects being introduced into industries, we may see some jobs being lost. This is due to some manufacturing methods not being as profitable as they once were, as the compensation payments could outweigh the profits they make. We know the unemployment rates are a huge problem and carbon offsetting may add more issues to this crisis. However, there may be new production methods and jobs created out of the carbon offsetting.
Takes Time For Permits
For some companies and developers, there is a lot of paperwork and red tape that is required to start the process. Sometimes it can take months and may mean that we only see large projects that can be funded for development.
What Are Other Ways To Offset Carbon?
- Investing in energy efficiency – Small steps such as starting a compost pile, upgrading your boiler, insulating lofts and using a water-saving showerhead are little ways to offset carbon. Energy-efficient buildings are becoming a great trend too, using fluorescent lamps rather than light bulbs and efficient heating.
- Methane Collection – Industrial waste can be a great way to reduce carbon offsets, by collecting and combusting the methane generated by industrial waste and also methane that is generated from landfills.
- Planting more trees – Trees capture carbon from the atmosphere and not only does it offset carbon, but develops soil quality and improves habitats. On average, one tree can absorb 1 tonne of carbon dioxide during a 100-year life span.
- Investing in renewable energy – We are seeing more and more energy companies switching to renewable energy, such as solar, hydro, biomass and wind energy. Not only is it great for the environment, but can be a lot cheaper too.
How Much Carbon Do We Emit In The UK?
The average amount of carbon emitted by a person in the UK is 8 tonnes per year. Currently, the UK ranks 36th in the world for carbon emissions, with China, The United States and India being the top 3 contributors. Below is the 2018 ranking of countries in order of carbon emissions.
|Rank||Country||CO2 emissions (total)|
What Are The Top Carbon Offsetting Initiatives?
There are currently a lot of good carbon offsetting initiatives available that are suited to different business needs and can be personalised to your company. Two popular accreditation organisations are:
The Verified Carbon Standard – A recognised standard, the Verified Carbon Standard is more accessible for smaller companies and has renowned, precise accuracy.
The Voluntary Gold Standard – Seen as one of the more rigorous standards with better accuracy than others, the Voluntary Gold Standard also use projects that have benefits for local economies and communities.