Environment

How Real Are Carbon Offsets?

Purchasing carbon offsets is a widespread means of attempting to meet carbon-reduction and net-zero emissions goals across many industries. Also widespread is the increasing scrutiny of the practice. How “real” are the offsets? How are they quantified and verified, and by whom?

CO2 written in airstreams over a rural scene
Getty Images

Purchasing carbon offsets is a widespread means of attempting to meet carbon-reduction and net-zero emissions goals across many industries. Also widespread is the increasing scrutiny of the practice. How “real” are the offsets? How are they quantified and verified, and by whom?

Purchasing carbon offsets, or carbon credits, is an option when a company’s efforts to eliminate its carbon emissions through mitigation methods fall short.

The offsets are purchased through investments in projects that remove carbon from the atmosphere such as nature-based solutions (e.g., REDD, or reducing emissions from deforestation and forest degradation), negative-emission technologies (including carbon capture and storage [CCS] and bioenergy with CCS), and renewable energy.

Here’s where the criticism arises: How is the amount of carbon captured by these projects measured? For example, how much carbon can a tree or forest handle? Are all trees equal in their carbon intake?

The uncertainty and variability in carbon-accumulation rates is acknowledged in research studies that are attempting to provide quantification. A study published in Nature compiled more than 13,000 georeferenced measurements to determine the rates for the first 30 years of natural forest regrowth. A map showed more than 100-fold variation in rates across the globe and indicated that default rates from the Intergovernmental Panel on Climate Change may underestimate the rates by 32% on average and do not capture eightfold variation within ecozones. On the other hand, the study concluded that the maximum mitigation potential from natural forest regrowth is 11% lower than previously reported because of the use of overly high rates for locations of potential new forest.

While the study was not intended to provide verification to be used in the carbon-offset market, it points to the difficulty in getting the numbers right.

Third-party verifiers are casting light on the validity of offsets. Various organizations such as the Climate Registry and the American Carbon Registry (ACR) aim to set standards and best practices. In both the regulated and voluntary carbon markets, ACR says it “oversees the registration and verification of carbon-offset projects following approved carbon accounting methodologies or protocols and issues offsets on a transparent registry system.”

In July, CarbonPlan, a nonprofit that analyzes climate solutions based on the best available science and data, rated BCarbon, a standard created by Rice University’s Baker Institute for Public Policy, as one of the best publicly available protocols for soil carbon offsets in the US.

BCarbon, a nature-based mitigation system, aims to remove CO2 from the atmosphere and store it in soil as organic carbon. Based on independent verification and certification requirements, the credits under the system are issued for the removal of CO2 by photosynthesis and storage as carbon in soil. Landowners are eligible for storage payments. The Baker Institute said the approach could unlock the potential for removal, storage, and certification of upwards of 1 billion tons of CO2 and lead to the protection and restoration of hundreds of millions of acres of grassland.

Scrutiny of carbon offsets is beneficial in this expanding carbon market. Verification and certification will serve to increase the trust of both buyers and sellers—and the public—in what will likely be a bridge toward longer-term solutions to reduce global carbon emissions. And getting the numbers right is essential.