Carbon Offsets Don’t Reduce Greenhouse Gas Emissions

Carbon offsetting—the practice of investing in offsite, frequently out-of-country greenhouse gas emission reductions to counterbalance a company’s own emissions—doesn’t work, and should be dropped from the menu of responses to achieve the Paris Climate Accord, two studies assert. The implications are especially stark for aviation.

The first report, prepared for the European Commission last year and published this month, found that 85% of the emission reductions claimed by carbon offset schemes would have happened anyway. That means they failed the key test for such offset schemes—that they achieve actual emission reductions that are “additional” to what would otherwise have occurred.

Offsetting was allowed under the Kyoto Protocol’s Clean Development Mechanism (CDM) with the expectation that carbon emitters from developed countries, whose emissions were capped, would offset them by investing in emission-reducing projects in developing countries. However, Berlin’s Institute for Applied Ecology reported, “85% of the projects covered in this analysis, and 73% of the potential 2013-2020 supply, have a low likelihood that emission reductions are additional and not over-estimated. Only 2% of the projects and 7% of potential supply have a high likelihood of ensuring that emission reductions are additional and not over-estimated.”

“It’s a confirmation that offsetting is fundamentally problematic,” said Aki Kachi, international policy director for Brussels-based Carbon Market Watch, which reached much the same conclusion in its own report this month.

Carbon Market Watch’s concluded that the CDM was never intended to reduce emissions, only to neutralize (some of) their increase in developed nations. Its accounting has become more “problematic” under Paris, raising the risk that emission reductions may be counted twice—once under the Kyoto CDM, crediting the offset purchaser’s country, and again by the country where the reduction occurred, counting against its Paris commitment. The system also gave “perverse incentives” to developing countries to leave emissions unchecked while seeking offset sales, and assumed little technological progress. With those shortcomings, Carbon Watch found that the “vast majority of carbon offsets are very likely not additional, measureable, or real.”

Discrediting offsets as a credible way to claim greenhouse gas emission reductions will strike particularly hard at airlines. Global civil aviation agreed last October to what it claimed at the time was a “landmark accord” on climate change. It relied heavily on the international purchase of carbon emission offsets to achieve what the industry boasts will be “carbon neutrality” by 2020.

Air travel is expected to continue to expand, however, and the industry intends to close only part of the gap between actual fuel use and its carbon-neutral claim through more efficient aircraft. Most will be accomplished through the reduction in emissions that offsets claim to represent.

The EC study “is a wake-up call to the world that relying solely on offsets to address aviation’s climate impact is unsustainable,” warns Andrew Murphy, who tracks the industry for Brussels-based Transport and Environment. “Instead, the EU needs to pursue policies such as fuel taxation, ending subsidies, reforming the EU ETS [emissions trading system], and ceasing support for airport expansion.”

“At a minimum,” Murphy added, “The EU must ensure that the worst offset projects are excluded from the ICAO scheme to avoid greenwashing by the airline industry, the fastest-growing source of greenhouse gas emissions.”