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Touted as a climate solution, carbon offsets come back under scrutiny
Insights from The Washington Post, Bloomberg, The Guardian
The News
Documents reviewed by and reported in Reuters revealed that an influential corporate climate action non-profit called the Science-based Targets initiative (SBTi) found a form of carbon offsetting that allowed companies that emit greenhouse gasses to buy carbon credits in return are ineffective.
In the report, which Reuters said is preliminary, SBTi researchers looked at scientific papers and other data to conclude that the evidence “suggests that some or most emission reduction credits are ineffective in delivering emissions reductions.” The documents also highlighted instances where carbon credits don’t work to reduce emissions or stop deforestation.
This is not entirely new: Previous research has found some carbon offset projects have almost no effect and could even be damaging to the climate. But it adds to the growing evidence that carbon offsets don’t always work as intended.
Carbon offset certificates enable companies that emit greenhouse gasses to invest in carbon-mitigation projects, like green energy or tree planting, instead of lowering their own emissions. It’s a $2 billion market that has attracted fans, including former US climate envoy John Kerry, who argued that the money can spur investment in climate solutions more broadly.
SIGNALS
Carbon credits are big business
Tech giants Amazon and Microsoft have purchased carbon removal credits to fund carbon-capture technologies — whereby carbon is sucked out the air and stored or used — and rainforest rehabilitation. Salesforce’s CEO Marc Benoiff has spent $17 million on tree-planting programs, including 1t.org, which promises to plant and conserve a trillion trees by 2030, noting that “the greatest, most scalable technology we have today to sequester carbon is the tree,” as Bloomberg reported. Meanwhile, Delta Airlines spent $137 million in 2021 to buy carbon offsets to neutralize 27 million metric tons of emissions. Many airlines — planes are accountable for around 2.5% of global carbon emissions — have created customer rewards programs that let passengers pay to “fully offset” their flight.
Accountability is lacking at best
Popular carbon offset programs tend to fund tree-planting, which is based on an approach known as Reducing Emissions from Deforestation and Degradation (REDD+). But environmental experts warn that planting trees can be a “climate scam” and accelerate the climate crisis. That’s because many “do not deliver on their green promises.” The benefits of tree-planting, for example, are “deliberately exaggerated,” because project developers are trying to predict the future but “that’s never possible,” one environmental economist told The Washington Post. In 2023, The Guardian analyzed the results of 32 carbon offset projects and found that 90% of rainforest offset credits are likely “phantom credits,” and not genuine carbon reductions, “[posing] serious questions for companies that are depending on offsets as part of their net zero strategies.”
The European Union takes aim at corporate greenwashing
In March 2024, the European Parliament voted in favor of the Green Claims Directive, a bill that sought to ban companies from making net-zero pledges like “climate neutral” or “climate positive” based solely on carbon offsetting. “It should no longer appear that planting trees in the rainforest makes the industrial production of a car, the organization of a soccer World Cup or the production of cosmetics climate neutral,” said Anna Cavazzini, who chairs the EU’s committee on International Market and Consumer Protection. Experts said the move was a “big step” toward greater corporate honesty.
