Understanding the ABC of Carbon Offsets

We understand carbon offsetting as the procedure of curbing greenhouse gas emissions through particular projects to offset the impact of harmful gases emitted in the past. The motivation behind buying carbon offsets is to balance those emissions that we are unable to prevent during the course of our daily lives. If someone generates emissions when another sustainable alternate is available, it is usually frowned upon by eco-conscious people. For ease, one offset is measured as the reduction of one metric ton of carbon dioxide.

Several European countries have made nationwide legislations that permit businesses to emit up to a particular volume of emissions. If a business releases more than the assigned limit, it needs to buy carbon offsets to settle the equation. While this compulsory necessity to sustain a low carbon footprint is the main driver of offset trading, there is also a smaller voluntary marketplace. People who are eco-conscious buy offsets to decrease their personal carbon footprint even though they are not required by law to do this.

In simple words, the demand for carbon offsets is largely driven by environmental regulations on official state level and then by eco-conscious people feeling guilt when they release greenhouse gases. But how are carbon offsets ‘manufactured’? Companies that offer you offsets typically buy them from large projects carried out to cut GHG emissions anywhere in the world. Genuine projects ensure that the overall emissions released on earth get controlled so the exact site of these projects is not a big concern.

Greenhouse gases blend into the atmosphere and spread all over the earth rapidly; it doesn’t make any difference in the long run if you emit CO2 in United States, Asia or Europe as the overall effect will be the same for the global environment in each case. For the same reason, many carbon credit projects are set up in China even though majority of carbon credit buyers are located in Europe and North America. Because everything from labor to construction materials is cheaper in developing cities, the final cost of producing one carbon offset is considerably less if compared with European nations.

This small article won’t enter the debate of carbon offset scams. It’s sufficient to say here that carbon offsetting does help the planet if done according to established standards.

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