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The world of climate change is one of moderate, science-based discussion — mostly. There are, however, a few conversations that are guaranteed to reduce any meeting to angry tears.
One of these is around the use of so-called carbon offsets — voluntary credits that companies can buy to prove they have cut someone’s emissions rather than their own. While this market is riddled with problems, dogmatic opposition is muddle-headed.
Climate body SBTi has recently discovered just how emotionally charged offsets can be. The initiative, which validates corporate net zero plans, proposed that companies should be allowed to count certificates towards their emission-reduction goals. Its board is now under fire from staff and scientific advisers alike.
Part of the problem is that this market is periodically mired in scandal. More than 90 per cent of the voluntary credits out there fund “avoidance and reduction” projects, according to consultancy Carbon Direct. Broadly speaking, that means paying people not to cut down forests, or distributing low-emission cookstoves in Africa to replace those that use wood, paraffin or kerosene.
The pitfalls are obvious. Generating a credit requires figuring out what would have happened otherwise. Was the forest really going to be cut down? How often would people have used their highly emitting stoves? Providers of credits have an incentive to game the numbers, and the world is awash with studies that prove and disprove competing claims.
The accounting should be a fixable problem. But the bigger concern is that even high-quality avoidance and reduction is not really additional: what most of these actions achieve is already included in global net zero pathways. Companies are meant to be cutting their own emissions at the same time as oceans and forests recover their carbon-absorbing potential. If they substitute the latter for the former, the world will veer off track.
By the same token, even planting new trees is not really “additional”. And, because trees have finite lifespans, they are poor compensation for emitting a tonne of long-lasting CO₂ into the atmosphere.
There is one corner of the market that is worth a proper look. Projects that permanently sequester CO₂ are scientifically measurable and logically unassailable. Those involve capturing CO₂ from the air or from biomass and then storing it geologically, or even “mineralising” it into rocks. This covers carbon capture and storage (CCS), but also other technologies.
The trouble is that the volume of these high-quality, long-duration projects is tiny. Airbus has committed to paying for 400,000 tonnes of carbon that has been directly captured from the atmosphere by a subsidiary of US company Occidental Petroleum, called 1PointFive. Microsoft has promised to pay Ørsted to capture 2.76mn tonnes of CO₂ from a biogenic plant in Denmark.
As well as being tiny at present, this type of permanent carbon removal is also wildly expensive, with costs ranging from perhaps $500 to $1000 per tonne, thinks Julio Friedmann, chief scientist at Carbon Direct. For reference, the European Emissions Trading System certificates at present change hands at €66/tonne.
Companies can reduce their own emissions for much less, of course. But given that some emissions will either be really expensive or even impossible to abate, it makes sense to start to work on the “net” in net zero. And getting new technologies off the ground is a much better way for big companies to use their clout than dodgy tree-saving schemes.
camilla.palladino@ft.com
