Thousands of companies have set net-zero targets, and many are using carbon offsets — for example, the payment to protect forests — to advance their claims to reduce emissions. Shell, for example, spent $26 million on things like tree-planting projects last year and plans to use nature for “mitigation.” 120 million Metric tons of carbon dioxide they emit annually by 2030.
In theory, these kinds of carbon offset programs — covering everything from additional forest financing to methane capture in landfills to improving sustainability in agriculture — sound like a good thing. But the system has some obvious flaws. “We Can’t Make Our Way Out of Climate Change,” John Oliver said on the last episode of “Climate Change.” last week tonight, who spent 23 minutes identifying some issues with compensation.
Carbon offsets have been around for decades, but the voluntary market swelled to $2 billion in 2021, four times the size of the previous year. They have serious limitations, starting with the fact that some companies, such as Shell, plan to use them instead of reducing their emissions. It’s also hard to prove that a particular offset project actually helps and hard to prove that the benefits will last – some forests that were protected by carbon offsets have already burned in wildfires, releasing carbon captured in the trees.
At the same time, there is an increase in efforts to improve the system, including new standards for how companies use carbon credits and new approaches to designing and measuring the offset programs themselves.
It’s often hard to prove that offsets made something that wouldn’t have happened anyway, a factor called “incremental”. JPMorgan Chase, for example, Spent nearly 1 million dollars To help conserve a forest in Pennsylvania that has been a sanctuary for birds since the 1930s — and arguably, it wasn’t in great danger of widespread logging. The American Carbon Registry, the organization that verified carbon credits, says that since there were previously no restrictions on logging, the refuge may have switched to logging if it later needed the cash, since logging is common on nearby lands. Offset has added new legal protections, so registration can now only take place in a limited way. But it is difficult to model a counterfactual: what would have happened in the shelter if the offset program had not existed?
“Is it possible to design a system that really clearly creates additional credit?” says Freya Chai, project manager at Carbonplan, a nonprofit organization that studies the impact of climate action. It is also difficult, she says, to design a system that can sometimes not be manipulated by less rigorous organizations trying to sell carbon credits.
One study Of some voluntary compensation projects in the Amazon rainforest it did not find “significant evidence” that these projects actually slowed tree loss. else Analytics Of California’s $2 billion Forest Compensation Program it was found that 29% of reimbursements were overestimating climate benefits, meaning that polluters buying these credits got away with it. emitting more carbon dioxide.
The challenge is not limited to forests. a Worksheet Of the more than 1,000 wind farms in India that were financed with carbon credits, it found that at least 52% of the projects are very likely to be built even if carbon credits are not in place. While the number of studies that have found problems with the system is growing, there are few, if any, studies that prove that particular offset projects have had clear success. “I don’t see any examples of carbon offsetting programs that are working well,” says Raphael Callel, a professor of public policy at Georgetown University who co-authored the wind farm study.
It is also difficult to prove that the benefit from a particular project will continue. In forest programs, trees can be lost to wildfires or disease, or if proper protection is not in place, they may be logged later. Projects use “buffer pools” as insurance to protect excess trees in case some of them are lost. But the study In an insulated swimming pool in California, it was found that wildfires had already destroyed all the compensation that was supposed to last for the rest of the century. For the insulating complex to function, it must be designed differently, better taking into account the impact of climate change on forests.
There’s also an even bigger challenge: protecting the forest, and other non-permanent offsets, aren’t really equivalent to emissions from fossil fuels. Some programs, such as the California program, call the forest program “permanent” if it is meant to last a century. “There is great value judgment there…