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The Importance of Carbon Offsets in Fighting Climate Change

importance of carbon offsets

If you’re reading this article you’ve likely heard of carbon offsets.

Carbon offsets have become a hot topic as companies, cities, countries, and organizations continue to find ways to reduce their contributions to climate change. 

And, with any new point of discourse in the environmental sector, comes questions from academics, institutions, and individuals looking to do the most good for our planet as we work to achieve global net zero emissions.

Some may refer to carbon offset projects as a form of “greenwashing” or an opportunity for the world’s largest greenhouse gas emitters to continue “business as usual”. But it’s not a black-and-white topic… 

There’s a whole lot of, well, green in the middle.

As we will discuss in this post there is not one end-all-be-all solution to combating climate change, and in fact, carbon offsets play an important role in achieving global emission reduction commitments.

importance of carbon offsets

What is a Carbon Offset?

But first, carbon dioxide.

It’s a naturally occurring greenhouse gas (GHG) that plays a key role in maintaining life on this planet—however, too much CO2 in the atmosphere contributes to climate change. 

And as we all know climate change has led to disastrous events such as melting ice caps and rising ocean levels. 

With the invention of carbon footprint calculating technologies individuals, companies, and organizations alike are now able to analyze the ways in which their daily activities generate CO2. Ideally, working to reduce their CO2 emissions as much as possible at an operational level.

However, in many instances, common reduction measures are simply not enough. That’s where carbon offsetting comes into play.

Carbon offsets reduce the effects of climate change by funding projects that actively reduce the amount of carbon in the atmosphere. Projects can include renewable energy projects like providing wind and solar power, protecting forests from deforestation, or improving livelihood projects that provide potable water to underserved communities reducing their reliance on wood-burning stoves. 

Put simply, carbon offsetting is any reduction of greenhouse gas emissions that make up for emissions that occur elsewhere. 

To learn more about the difference between carbon offsets and carbon credits as well as the major carbon standards that dictate carbon offsetting verifications you can read our full article on How Carbon Offsets Work.

An individual or organization can actively carbon offset by purchasing carbon credits. There are a variety of carbon standards but at a basic level, carbon credits are tokens of proof that an individual or organization has funded a project whose activity counteracts carbon emissions. The term carbon offset is used to describe both the credit and the act of carbon offsetting. 

3 Types of Carbon Offset Projects

Now that you know a little more about what carbon offsetting projects are and how they work to reduce GHG emissions, we’ll chat through the types of carbon offset projects.

Forest protection, improved forest management, water purification, methane capture, composting, creating clean energy sources, ocean conservation and cleanup… the list goes on. 

All of these projects can be divided into one of three main categories: nature-based, improved health and livelihoods, and sustainable infrastructure. 

1. Nature-Based Projects

Nature-based carbon offset solutions have the potential to provide 20% of the climate mitigation needed between now and 2050 in line with a 2°C warming scenario.

These initiatives reduce carbon emissions while preserving biodiversity, and providing jobs to local communities. Offset projects in this category are largely forestry-based and work to protect forests, repair degradation, and implement sustainable forest management.

Some examples of nature-based projects include:

  • Amazon Rainforest Protection is a forest conservation project that is responsible for reducing over 360,000 tons of carbon every year. 
  • McCloud River Conservation is a forest management project that generates 50,000 metric tons of carbon emissions reductions each year through sustainable practices of commercial timberlands. 
  • The Yarra Yarra Biodiversity Corridor in southwest Australia is an excellent example of a nature-based reforestation project as it involves planting indigenous species to encourage the reintroduction of endangered species and combat desertification. 

2. Sustainable Infrastructure

Projects that focus on building and scaling renewable energy like wind, solar, hydropower, and geothermal, as well as projects that use methane capture for energy and nitrous oxide abatement technologies, along with compost, biomass, and biogas are considered sustainable infrastructure projects. 

The major benefit of these projects is the reduction in reliance on fossil fuels which in turn improves air quality and lessens illness in local communities as well as stimulation of the local job market.

3. Improved Health & Livelihood

A changing climate can adversely impact food production, air quality, clean water access, and secure shelter. Under-represented communities in the global south are especially at risk. 

Improved livelihood projects help provide families and communities in need with items like fuel-efficient cookstoves, household solar and biodigesters, and water purification technology. These methods help improve air and water quality, reduce illness, and reduce household costs. 

Are Carbon Offsets Effective?: 6 Reasons They Work

  1. Carbon offsets reduce and prevent future carbon and other GHG emissions
  2. Carbon offsets help marginalized communities 
  3. Nature-based solutions are necessary to halt climate change 
  4. Brands that leverage offsets have a lower carbon footprint
  5. Brands can use carbon offsets to “tax” themselves
  6. Carbon offsets are one part of the solution

How Carbon Offsets Work & Fight Climate Change

We must do two things to avoid a climate breakdown: 

  1. Dramatically reduce emissions 
  2. Rapidly remove carbon that is already in the atmosphere. 

Climate change is driven by high greenhouse gas emissions, such as carbon dioxide and methane, that wrap the Earth trapping the sun’s heat and thus raising global temperatures. 

As discussed earlier, carbon offsets fund projects that either lower carbon emissions, prevent future ones, or take carbon out of the atmosphere and store it in carbon reservoirs. Investing in offset projects that help to remove or reduce the amount of carbon in the atmosphere is one of the key ingredients needed to combat climate change.

Carbon offsets reduce and prevent future carbon and other GHG emissions

Not only do carbon offsets help to reduce or remove existing carbon and GHG emissions, but offset projects can also help prevent the addition of future carbon and GHGs from entering the earth’s atmosphere. 

Offset projects that focus on protecting sizable natural carbon sinks, such as coastal wetland ecosystems, are one way to ensure that future emissions can be safely stored. 

For example, a mangrove restoration project in India is expected to restore over 16 million mangrove trees which are estimated to sequester 700,000 tons of carbon dioxide over the next 20 years! 

In addition to sequestering carbon, the restoration project will improve habitat conditions for the local fish and crab population which will result in the improved health of the marine ecosystem, thus ensuring the longevity of the carbon sink.

Carbon offsets help marginalized communities 

Unfortunately, marginalized communities are often the first to bear the brunt of both climate change and air pollution

Carbon offsets were originally created as a means to not only provide GHG reduction benefits but also benefit the communities in the vicinity of carbon offset projects. 

The benefits of a community in the vicinity of a project include:

  • Improved social, economic, and/or ecological outcomes related to the implementation of a carbon offset project. 
  • Increased community employment opportunities, air or water quality improvement, biodiversity and biological habitat conservation, energy access, and access to community health and education services. 
  • Businesses can make an impact with their finances by purchasing carbon credits that focus on improving the quality of life or environmental conditions for marginalized communities.  
  • Due to the environmental benefits that arise from carbon offset projects, carbon offsetting is capable of lessening environmental injustices while driving meaningful climate change mitigation. 

Think of it this way…

Approximately 80% of the world’s most impoverished communities depend on resources from local forests for survival. With each acre lost, these communities are further marginalized and exposed to environmental injustice. 

Forest offset projects like reforestation, conservation, or forest management are able to protect the land for those that rely on it, while also preventing species loss and removing carbon.  

For example, a forest conservation project in the Congo Basin Rainforest is simultaneously protecting over 300,000 hectares of land while providing over 130 locals with full-time job positions. The project supports training on sustainable agriculture and fishing practices in addition to offsetting close to 3.5 million tons of carbon throughout the project’s lifetime! 

Projects like these often work directly with local communities to ensure their involvement in the project to prevent the stated issues. Hear directly from the communities fighting against deforestation with the offsetting project Mai Ndombe in the DRC.

importance of carbon offsets

**Photo from Mai Ndombe, a Forest Conservation Project in DRC, Africa 

Nature-Based Solutions are Necessary to Halt Climate Change 

We love proving a point through a good study and data.

In 2017, a study published by Bronson Griscom and associates stated that nature-based solutions could help achieve 20% of the mitigation needed between now and 2050 to keep global warming below 2°C. 

Nature-based solutions refer to actions and policies that protect, manage, and restore ecosystems to address socio-environmental challenges. These nature-based solutions include a range of ecosystem-related approaches including the following categories: 

  • Ecosystem restoration 
  • Issue-specific ecosystem-related 
  • Ecosystem-based management
  • Ecosystem protection

The remaining 80% of mitigation will have to come from emission reduction strategies and carbon removal projects.

3 Ways Brands can use Carbon Offsetting to Fight Climate Change

We’re all in this together.

Industries and businesses are often cited as major emitters contributing to the climate crisis that the world is facing today. 

Instead of continuing “business as usual”, brands can incorporate sustainability in their core values by updating their sustainability plans to include emission reduction protocols and offset the remainder in order to hold themselves accountable for their environmental impact. 

1. Brands that leverage offsets have a lower carbon footprint

Minimizing or eliminating your carbon emissions is the best way to lessen the negative impact your business is having on the environment. But no matter how efficient you make your supply chain, there will always be inevitable emissions from business activities. 

Carbon offsetting enables businesses to counteract those carbon emissions that simply can’t be eliminated. In fact, the CDP Climate Change Report 2016 found that companies that bought voluntary carbon credits also made more ambitious emissions cuts compared to companies that did not.

In fact, carbon offsetting is a necessity in any serious sustainability strategy because sustainability isn’t just about mitigation. 

Since the industrial revolution, business operations have been emitting carbon into the atmosphere, which means it is critical businesses and organizations participate in programs that remove carbon from the atmosphere in addition to avoiding emitting any more. 

2. Brands can use carbon offsets to “tax” themselves

One of the main arguments about carbon offsets is that they should not make up an organization or business’s entire sustainability strategy.

And we agree!

There’s an entire section below on ways a brand or organization can reduce its environmental impact. With that being said, it’s important to note that many brands use offsets as a way to “tax” themselves as a way of holding themself accountable. 

Paying for offsets is expensive, so by becoming more sustainable and lowering emissions in other ways the number of offsets needed eventually reduces, which in return reduces the amount of money spent on offsets. 

Allbirds, a sneaker brand, is an example of a company dedicated to sustainability. In 2019, it was announced that the brand would establish a Carbon Fund in order to impose a carbon tax on itself. The company calculated the kg of carbon emitted for a single pair of sneakers and determined that it would cost them 10 cents to offset the emissions using their Carbon Fund. 

3. Carbon offsets are one part of the solution

There are many ways for brands to reduce their total environmental impact. As it has been mentioned throughout this post, carbon offsets are only one option for contributing to the fight against climate change.

Typically the first line of action is to reduce emissions where you can, as much as you can, in addition to purchasing carbon credits. Because businesses can have other environmental impacts besides emitting carbon. 

Therefore, it’s important to make sure your pathway to sustainability acknowledges the various environmental impacts your brand may have. There are many opportunities for companies to mitigate their carbon and environmental footprint such as:

  • For packaging, companies can look for more sustainable options, including using paper tape over plastic, compostable labels and packing peanuts, poly bags made from recycled materials
  • Optimize your website (the faster and more efficient a website is, the less carbon is required to keep it running) 
  • Set up a recycling program to take over the proper disposal of your products, offering discounts could further incentivize customers to take advantage of the program. 
  • Improve shipping methods by optimizing shipping routes to reduce fuel use, using shipping companies that rely on cleaner fuels, using renewable energy like electric vehicles where you can, and avoiding empty container repositioning. 

Each activity has a carbon footprint associated with it, sometimes we’re able to modify the activity to reduce your carbon and environmental footprint, such as with the activities mentioned above. 

However, there is a point at which emissions can no longer be reduced, at least with where technology is at now and therefore carbon offsets offer a viable resolution. 

fighting climate change

Common Questions About Carbon Offsets 

Carbon offsetting is a complicated topic. We get it.

That’s why we’re going to answer some of your most common questions about carbon offsetting and its role in fighting climate change below.

What are some examples of carbon offsets?

Carbon offsets fund specific projects that either lower CO2 emissions, or “sequester” CO2, meaning they take some CO2 out of the atmosphere and store it in carbon reservoirs or sinks. 

Some common examples of projects include reforestation, building renewable energy, carbon-storing agricultural practices, and waste and landfill management. 

Do carbon offsets help the environment?

Carbon offsets DO help the environment. By reducing or removing carbon and other GHGs from the atmosphere that increases the Earth’s temperature, offset projects help to mitigate climate change. 

In addition to this, maintained carbon offset projects are able to improve the overall health of the ecosystem and the project’s local community. 

Benefitting the environment and local communities? 100%, yes! 

What are carbon offsets used for?

Carbon offsets are credits purchased from carbon offset projects that are designed to reduce emissions of planet-warming greenhouse gasses.

How do carbon credits reduce emissions? 

Carbon credits reduce emissions as the projects credited implement actions to increase the sequestration of climate-warming emissions into carbon sinks or by reducing the emission of GHGs from sources such as landfills or farms. 

In Conclusion: Carbon Offsets Play a Crucial Role in Fighting Climate Change

That’s right.

Carbon offsets play a vital role in combating climate change. 

It’s strongly recommended that businesses and brands reassess their sustainability strategies to ensure that they are minimizing their emissions as much as possible and offsetting those that they cannot.

If you’re an eco-conscious ecommerce brand looking to double down on your sustainability strategy, reach out to our dedicated EcoCart to learn how you can leverage carbon offsets to fight climate change. 

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