Why use carbon offsets?

Offsets are not a replacement for direct action by individuals, businesses and organizations to reduce their own carbon footprints, but if used as a complementary measure, they can offer a number of benefits.

Benefits of carbon offsets

Along with their key benefit – creating reductions in greenhouse gas emissions – voluntary carbon offset purchases also have the potential to:

• Give individuals, businesses and organizations the ability to take responsibility for their own climate impact, and to demonstrate leadership on climate change by going beyond existing government regulations or incentives.
• Make it possible to take responsibility for an entire carbon footprint, including emissions that can’t be reduced, and even those that cannot directly be controlled, such as those from suppliers (in the case of businesses).
• Provide a way to address the greenhouse gas emissions from economic sectors (e.g., international air travel) that aren’t effectively covered by existing government regulations.21
• Allow greenhouse gas reductions to be made wherever it is most cost effective by using the flexibility of the carbon market.
• Act as an interim measure that allows time to find ways to make further direct reductions, while still taking responsibility for one’s climate impact.
• Help to make greenhouse gas reduction projects more economically viable, by providing another income stream for project developers.• Promote innovation, and bring environmental and economic co-benefits to communities where the offset projects take place.
• Put a price on the carbon emitted by a business, organization, or individual. This extra expense (e.g., on a business’s balance sheet) can provide an incentive to make further emission reductions in the future.It can also build support for government regulations that put a price on carbon.
• Contribute to a better understanding of the magnitude and cost of greenhouse gas emissions, the need to make reductions, and where reduction efforts can best be targeted. Calculating emissions in order to purchase offsets is often the first opportunity for many organizations and individuals to gain an understanding of these issues.

Criticisms of carbon offsets

Despite these potential benefits, carbon offsets have been criticized by some commentators as being akin to “papal indulgences”, “just a way to buy your way out”, or as a right to pollute for those who can afford it.

However, these criticisms are unjustified, considering that carbon offsets can result in real reductions in greenhouse gases. Offsetting can be seen as a voluntary application of the “polluter pays” principle, whereby those who produced the pollution take responsibility for cleaning it up. It should also be noted that offsetting is similar to any other service available in a market-based economy, such as financial accounting or a telecommunications (e.g., phone) service ,where factors like a need for specialized expertise or economies of scale lead to the out-sourcing of some activities.

Purchasers pay for the service because they lack the time, resources, or expertise to do it themselves. It is important to recognize that carbon offsets are not a silver bullet for climate change, and that no voluntary approach to greenhouse gas emissions should ever delay or take the place of effective government regulations that set firm reduction targets and put a price on emitting carbon. However, the problem of climate change is so large and urgent that it requires a whole range of solutions, and voluntary carbon offsets can make a contribution.

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