Forum: Carbon credits may be giving companies a way out instead of reducing actual emissions
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Companies are buying more carbon credits to make up for the pollution their companies produce. This voluntary practice is known as “carbon offsets”. The idea is simple. If companies cannot reduce their actual carbon footprint, they will write a cheque once a year to some groups. The groups will then use the money to, for example, plant new trees in rainforests or build new projects, so that the polluting companies’ emissions will be balanced out by the carbon removed from the atmosphere by the new trees and new projects.
While the idea of carbon offsets is intuitive, it is more complex in practice. First, buying carbon credits does not reduce companies’ actual emissions. Instead, purchasing credits allows companies to continue emitting pollution. Carbon credits give companies a way out instead of reducing actual emissions.
Second, some carbon credits are for trees that are already being planted or projects that are already being built. Buying these zombie credits will not offset any new emissions.
Lastly, not all carbon credits are created equal. Some carbon credits are for projects with well-defined and clear environmental benefits. For instance, some carbon credits come from projects that trap methane, a potent greenhouse gas, from landfills and use it to produce hot water. These projects can significantly reduce greenhouse gases and provide clear environmental benefits.
Other carbon credits could, however, be for vaguely worded “avoided deforestation” projects, in which companies pay certain groups in rainforests not to cut down trees. The environmental benefits of these projects can be more challenging to monitor and verify.
So what should companies do about this? Companies should not outsource their environmental and social responsibilities to someone else by buying carbon credits. And for companies that have no choice, they should ensure that the carbon credits they buy are genuine carbon offsets. No matter which options companies go for, reducing one’s own emissions is still the best way to go.
Kelvin Law
