Corporate Climate Watchdog Document Deems Carbon Offsets Largely Ineffective- Reuters
Staff at a prominent corporate climate action group, whose board proposed allowing companies to offset greenhouse gas emissions from their supply chain with carbon credits, have discovered these offsets to be largely ineffective, according to a confidential preliminary draft reviewed by Reuters.
The growth of the voluntary carbon offsets market is at stake. Though utilized by major companies like Microsoft, Salesforce, and Amazon.com, the market size is still small, around $2 billion.
Last month, the Science-based Targets initiative (SBTi), a U.N.-backed nonprofit, caused a stir among its staff by announcing plans to permit the use of carbon credits before completing its research on them. Since then, the SBTi’s board clarified that its policy remained unchanged, and decisions would be guided by evidence.
The unrevealed findings from the SBTi staff document, seen by Reuters, stem from a review of scientific papers and submissions. They await analysis and review by the Scientific Advisory Group, comprising global climate scientists. If validated, they could hinder SBTi’s adoption of carbon offsets in companies’ emission reduction plans.
Many of the SBTi’s financial backers, like the Bezos Earth Fund and former U.S. climate envoy John Kerry, advocate for adoption. They argue that offsets are necessary to boost investment in clean energy and achieve the global pledge of net-zero emissions by 2050. An SBTi spokesperson clarified that their research on carbon offsets isn’t finished, so it would be wrong to claim any interim findings.
“Once we have completed the analysis, we will make the results available publicly. Until that point we will not be able to comment on the submitted evidence,” the spokesperson said.
The document reviewed by Reuters states that “higher quality empirical and observational evidence suggests that some or most emission reduction credits are ineffective in delivering emissions reductions.”
The draft highlights cases of carbon credits failing to deliver promised climate benefits. For instance, one study found no significant evidence that projects in the Brazilian Amazon reduced forest loss. It also mentions instances where schemes oversell credits or exaggerate emission reductions.
POLICING THE QUALITY
Proponents argue that selling carbon offset credits to companies, enabling them to offset pollution, can funnel funds into climate-friendly projects. Critics doubt the quality of these offsets, fearing they might allow companies to evade emissions reduction responsibilities.
The Integrity Council for Voluntary Carbon Markets, a nonprofit overseeing carbon offset quality, aims to broaden its approved projects. Last month, the U.S. announced plans to release guidelines for carbon offset use, both in and outside of government, to bolster market confidence and ensure accurate emission reductions. Meanwhile, the European Union is exploring options to incorporate voluntary carbon credits into its existing carbon allowance scheme.
The COP28 climate talks in December failed to finalize new rules for launching a central system for offsetting carbon emissions and trading offsets among countries and companies.
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