For the uninitiated, the world of carbon offsetting—and carbon offsetting programs—can seem both intimidating and incredibly complex. We’re hoping to help simplify buying carbon offsets. Here’s what to know and who to turn to when making your selection.
What is the definition of carbon offsetting?
Carbon offsetting is the act of compensating for your own carbon footprint by financially supporting a project that’s working to reduce the amount of greenhouse gas (GHG) emissions in the atmosphere.
In the past, people have associated carbon offsetting projects mostly with tree planting. But the types of carbon offset projects are actually wide-ranging, from wind farms and water purification efforts to initiatives that provide environmentally friendly cookstoves to families in developing countries.
What is the difference between a carbon offset project and program?
People often use the terms “carbon offset project” and “carbon offset program” interchangeably, but they’re definitely separate things:
The definition of a carbon offset project
A carbon offset project is an activity or initiative that works deliberately to reduce GHG emissions—or increase carbon storage—in order to compensate for emissions that occur elsewhere.
The definition of a carbon offset program
A carbon offset program is an organization or certification body that creates standards that are used to measure, regulate and review carbon offsetting projects. Sometimes referred to as “carbon registries,” carbon offset programs make sure the projects they vouch for are trustworthy.
The definition of a carbon offset third-party auditor / verifier
A third-party auditor or verifier audits the project according to a carbon offset program’s standards, ensuring the project is meeting those standards.
Are carbon offsetting projects just another version of greenwashing?
Unfortunately, carbon offsetting projects aren’t immune to greenwashing, and “carbon washing” is a growing concern to some. One study published by the European Commission in 2016 found that 85 percent of offsets failed to reduce emissions, while more recent studies have revealed that the actual carbon reduction of some projects is much lower than what’s claimed.
Well-intentioned projects can also have negative side effects for the communities they’re based in. For example, pesticides from certain reforestation projects could be polluting surrounding waterways.
So how can we offset our personal emissions while avoiding the carbon-washing conundrum? Enter carbon offset programs.
As a consumer, you can determine whether or not an offset project is carbon-washing by looking for a carbon offset program’s seal of approval.
When you see that seal, you’ll know whatever project you’re thinking about investing in has been thoroughly evaluated and audited by a reliable group.
The 4 best carbon offset programs
Here are four of the most trusted and established carbon offsetting programs you’ll find on the market. Each has a solid track record of performance and accountability.
What is the Gold Standard?
In 2003, environmental and human rights organizations convened in Brussels to discuss the need for a system to audit projects that claimed to reduce GHG emissions. The result was the establishment of the Gold Standard Foundation, a non-profit headquartered in Geneva.
What type of offset projects does Gold Standard certify?
Also known as the Gold Standard for the Global Goals, this certification program is unique, because it puts the United Nations’ 17 Sustainable Development Goals (SDGs) front and center when it evaluates projects.
To be certified, projects—which typically fall under the categories of renewable energy, reforestation, or community service projects such as waste management—need to contribute to a minimum of three SDGs.
How do we know Gold Standard is credible?
The result is that the Gold Standard is considered one of the most rigorous climate standards. It has been endorsed by more than 80 NGOs, including the David Suzuki Foundation and WWF. To date, around 2,000 Gold Standard–certified projects in more than 80 countries have prevented more than 173 million tonnes of Co2 from entering the atmosphere.
How do you support Gold Standard–verified projects?
However, Gold Standard is unique in that you can also directly support projects through its site. Projects range in both purpose and price, from a PET plastics recycling program in Romania ($47.00/tonne) to biodiverse forest planting in Panama ($18.00/tonne) to cookstove improvements in Rwanda ($15.00/tonne).
If you can’t decide what type of project you’d like to get behind, you can purchase a Climate+ Portfolio (starting from $11.00/tonne), and Gold Standard will allocate your contribution from a range of certified projects.
2. Climate Action Reserve (CAR)
What is the Climate Action Reserve?
CAR began in 2001 as the California Climate Action Registry, with a mission to encourage companies and other organizations to measure, manage and reduce GHG emissions.
How do we know Climate Action Reserve is credible?
Having celebrated its 20th anniversary in March 2021, CAR is considered the premier voluntary carbon offset registry for the North American carbon market. It’s been used by high-profile brands and events like the 2014 Winter Olympics, Stanford University and Disney. Thanks to this support, in 2021, CAR hit a milestone by achieving more than 150 million metric tonnes of GHG reductions.
What type of offset projects does Climate Action Reserve certify?
CAR registers and certifies carbon offset projects based on their permanence and whether their estimated GHG reductions can be comprehensively accounted for and audited. It also considers whether a project has the potential to create negative economic or environmental outcomes, or if it may have social benefits beyond climate change mitigation.
While most of CAR’s projects—including coal mine methane capture, landfill gas collection and even rice cultivation—are based in the United States, it also certifies projects in Canada and Mexico.
Regardless of location, all carbon offset credits generated by CAR-certified projects are assigned a unique serial number. This helps CAR track each project effectively. More importantly, it assures buyers that a “retired” credit (one that’s already been used to offset a tonne of emissions) can’t be sold or transferred again.
How do you support Climate Action Reserve certified projects?
CAR doesn’t sell credits directly to consumers, though you can donate to the organization. To buy carbon offsets, you’ll need to visit a carbon offset retailer. When you do, look for the CAR seal of approval.
What is Verra?
A non-profit organization headquartered in Washington, D.C., Verra manages six different environmental certification programs. It’s best-known for overseeing the Verified Carbon Standard (VCS) program, the world’s most widely used voluntary GHG program. You might even recognize the logo: It appears when you choose to offset your credits when buying from airlines such as British Airways; easyJet adds these credits automatically when you purchase a ticket.
What type of offset projects does Verra certify?
There are carbon offset projects certified according to VSC’s rigorous rules and requirements all over the world. They fall under 15 major “sectoral scopes” and cover everything from energy distribution to transport to metal production to livestock manure management.
VSC is also working to develop carbon crediting procedures for seascape activities, such as kelp farming, sustainable fishing and seagrass meadow restoration. These have the potential to reduce or remove more than one billion tonnes of CO2 from the atmosphere each year, all while restoring ocean environments.
Much like CAR, Verra issues a unique number to each tradable GHG credit produced by a certified project. These numbers are called Verified Carbon Units, or VCUs, and they can be sold on the open market as a flexible way for individuals and companies to offset their own emissions.
How do we know Verra is credible?
Since the inception of Verra’s VCS program, nearly 1,700 VCS-certified projects have reduced or removed more than 630 million tonnes of carbon and other GHG emissions from the atmosphere.
How do you support Verra-certified projects?
4. American Carbon Registry (ACR)
What is American Carbon Registry?
ACR is a pioneer on the voluntary GHG emissions scene. Based in Arlington, Virginia, it was founded in 1996 by the Environmental Resources Trust (ERT) as the first private voluntary greenhouse gas registry in the world.
What type of offset projects does American Carbon Registry certify?
An enterprise of Winrock International (a non-profit dedicated to sustaining natural resources and protecting the environment), ACR operates in both voluntary and regulated carbon markets. Projects are located worldwide and include improved forest management, recycling of transformer oil, and carbon capture and storage.
ACR uses “science-based carbon offset standards” for evaluating projects. Its methods are audited for accuracy by both public comment and external scientific peer review. ACR requires projects to demonstrate permanent carbon reduction or removal, and adhere to environmental and community best practices.
Among the many innovative projects that ACR supports is a truck stop electrification initiative, which utilizes plug-in units that have the potential to reduce, by around 4.1 million tons a year, the nearly 11.5 million tonnes of GHG emitted annually by long-haul truck drivers idling at stops.
It also supports a program that offers eligible farmers a financial incentive to voluntarily reduce emissions by curbing the amount of nitrogen-based fertilizer they use to grow corn.
How do we know American Carbon Registry is credible?
ACR isn’t just the oldest kid on the block when it comes to carbon offset programs; it’s also one of the most trusted. In 2020, it was chosen by the Council of International Civil Aviation Organization (ICAO) to supply emission reduction units for the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA), a scheme that’s expected to offset 2.6 billion tonnes of carbon over the next 14 years.
How do you support American Carbon Registry certified projects?
As with CAR and Verra, you’ll need to visit a carbon retailer. Credits for ACR-certified projects can be purchased on Carbonfund.org.
Why your purchase of a carbon offset project matters
Offsets aren’t a replacement for actual emissions reduction, but they can help make a difference. By choosing to contribute to a certified carbon offset project, you’re helping to support the best carbon offset programs, which are working to make tangible changes to the earth’s atmosphere.
This article offers general information only and is not intended as legal, financial or other professional advice. A professional advisor should be consulted regarding your specific situation. While the information presented is believed to be factual and current, its accuracy is not guaranteed and it should not be regarded as a complete analysis of the subjects discussed. All expressions of opinion reflect the judgment of the author(s) as of the date of publication and are subject to change. No endorsement of any third parties or their advice, opinions, information, products or services is expressly given or implied by Royal Bank of Canada, RBC Ventures Inc., or its affiliates.