What is carbon offsetting?

A carbon offset is a scientifically quantified reduction in greenhouse gas emissions created when one metric ton of greenhouse gas is captured, avoided or destroyed in order to compensate for an equivalent emission made elsewhere.

Carbon offset schemes allow individuals and companies to invest in environmental projects around the world in order to balance out their own carbon footprints. The sale of carbon credits does this by financing carbon reduction projects (e.g. tree planting) and carbon removal projects (e.g. carbon capture and storage). Common carbon offset project types include

  • Sustainable forestry - Increasing the amount of carbon stored within trees through tree planting or improved forest management.
  • Landfill gas - Capturing and destroying methane generated as a byproduct of decades of waste like paper and textiles deposited into landfills.
  • Livestock manure management - Avoid or capture methane created by disposal of animal manure into wastewater lagoons through the installation of advanced treatment technologies.
  • Industrial processes - Changes to manufacturing processes that reduce the use or emission of greenhouse gases.

Principles for carbon offsets

Offset projects can vary greatly in terms of their size, the methodology they use and where they are located. However, all projects must meet certain minimum criteria:

  • Additionality: Evidence that the project’s emission reductions would not have been achieved without the promise of funding from carbon offset sales
  • Quantification: Evidence that the emission reductions have been achieved using a rigorous and conservative quantification methodology
  • Verification: Assurance of such evidence and quantification by an accredited third party verifier
  • Registration: Issuance, tracking, and retirement on a third-party public registry