Carbon Offsets Guide

Win-win or pay to sin? Your Guide to Carbon Offsets.

You’ve seen it in the news: Celebrities are flying all over the globe in private jets, then assuaging their guilty consciences by paying a fee to a company to “offset” their emissions of carbon dioxide and other climate-altering greenhouse gases. Or maybe you’ve passed a Hummer on the highway with a bumper sticker reading, “My vehicle is carbon neutral.” If that’s not galling enough, there are reports of some of the carbon-offset companies making obscene profits and contributing less than 20% of revenues to emissions-reduction projects. So are carbon offsets nothing but “greenwash”?

carbon offsets

Not quite. But this new and booming industry deserves to be treated with a healthy dose of skepticism. The concept is a good one–carbon offsets give you a way to vote with your dollars. Problem is, right now it can be hard to tell whether your money is actually doing any good. While there are several organizations working to establish standards for offset quality, the industry is largely unregulated, and some offset providers are not delivering on their promises.

Read on to learn about what to look for–and what to look out for–when buying offsets.

What are carbon offsets?

The vendors who offer carbon offsets are middlemen. They take in payments from consumers and companies, take a cut for themselves, and direct the rest to green projects. Of course, when you send your money to an offset vendor, you’re not directly cutting your personal emissions–you’re just paying for emissions to be cut elsewhere. Greenhouse gases readily mix in the atmosphere, so in theory reducing emissions in another part of the world is as effective as reducing them in your backyard.

Most carbon offset programs are very accommodating, allowing you to offset emissions of a one-time event, like flying across country for your college roommate’s wedding, or ongoing emissions, like all the energy used annually by your home and vehicles. With a credit card number and a few clicks of the mouse, you can join the fast-growing world of carbon offsetting.

What types of projects do carbon offsets support?

You can buy carbon offsets that support domestic or international projects. The projects fall into two general categories: those that reduce greenhouse gas emissions and those that pull carbon from the atmosphere (also known as carbon “sequestration”).

wind farm

Emissions-reduction projects include energy-efficiency upgrades at manufacturing plants, and large and small solar and wind power installations.

Carbon sequestration projects include capturing methane from coal mines, animal waste and landfills, as well as forest protection and restoration. Some experts suggest thinking twice about supporting forest-related offset projects because the emissions reductions are more difficult to monitor than energy efficiency or renewable energy projects. To offset emissions, a tree needs to survive for many decades, but the actual carbon savings from a reforestation project may be short-lived. Even if the forest isn’t logged, trees can be killed by disease and fire.

Some offsets support projects in developing countries, such as supplying efficient cooking stoves to replace polluting wood-burning stoves and providing hand-powered pumps to replace dirty diesel-powered pumps for irrigation.

How much do carbon offsets cost?

Carbon offset prices vary, depending on the assumptions built into the offset company’s calculator and how much it charges per ton of emissions. For a round-trip flight between San Francisco and New York, the cost of a carbon offset from three popular companies ranges from $10 to $36. The same three companies charge from $50 to $72 to offset the annual emissions of a mid-size car, and from $90 to $288 to offset the emissions of an average home.

Does spending less mean you’re getting a bargain, or not paying your fair share for emissions reductions? Does spending more mean you’re doing more good, or that the offset company is keeping a bigger piece of the pie? This is a new and largely unregulated market, so it’s tough to tell. Read on for more guidance.

How do I pick a carbon-offset company?

There aren’t yet any widely recognized standards or regulations to ensure that the emissions reductions you buy are real. A few organizations, such as Green-e Climate, are stepping up to screen carbon offsetting programs and certify that they are legitimate.

Once certification standards become more established and widely used, it will be easier for individuals to feel confident that their money is being well spent. For now, your best bet is to examine the websites of various offset companies. If a site doesn’t answer all your questions, give the company a call or look to another offset vendor.

Here are some questions that the carbon offset company should answer in detail:

  • Are the offsets tied to specific projects? Are the projects and their expected results described in detail?
  • How does the company demonstrate that the projects wouldn’t have happened anyway, without the contribution from the offsets? This is sometimes called the “additionality test.”
  • What credible third-party standards are used to validate additionality, the quality of the emissions-reduction projects, and the company’s accounting procedures?
  • How does the company demonstrate that the offsets aren’t double sold, in other words, that the same emissions reductions aren’t sold to multiple buyers?

Last words

No carbon offset program offers a “silver bullet” that will solve the global warming crisis. As responsible citizens, we first need to make difficult choices to reduce our personal carbon footprints by conserving, investing in efficiency, and cutting unnecessary consumption and travel. We also have to pressure our politicians to vote for real, far-reaching legislation that will reduce our dependence on “dirty” energy. Carbon offsets are merely a small part of the solution. The best approach to energy is of course “clean” energy, like solar, wind or fuel cells.

If you are interested in learning what you can around your home, please spend some time in our Carbon Center and measure your own Carbon Footprint. We can provide you lots of great advice to reduce your own carbon emissions–so you don’t feel compelled to purchase offsets.

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  1. Robert Vincin July 6, 2010
  2. Peter Henderson July 7, 2010
  3. Erwin Hudelist July 26, 2010

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