This week we’re taking a look at carbon offsets - what exactly are Carbon Offsets, how do they work, and why are they considered important change enablers by some and an accounting swindle by others?
What are Carbon Offsets?
In short, a carbon offset is a reduction in emissions of CO2 or other greenhouse gases in one area in order to compensate for emissions produced elsewhere.
Offsets are typically quantified in tonnes and hence 1 tonne of carbon offset represents the reduction / avoidance / removal of 1 tonne of CO2.
Before we look into ways of generating offsets we have to acknowledge that two types of markets exist for carbon offsetting - voluntary and compliance.