CEF Spotlight

Carbon Onsetting as an Alternative to Offsetting

0490d59By Daniel Greenberg, Founder and CEO, Earth Deeds 

How can businesses meaningfully respond to their unavoidable CO2 emissions? Traditionally, the only option has been to purchase carbon offset credits on the Voluntary Carbon Market (VCM). These credits represent the CO2 mitigation benefits of reforestation, renewable energy, and other environmental projects and enable consumers to “offset” their emissions and claim to be “carbon neutral.”

With over 100 carbon offset companies, the VCM grew to $572M in 2011 and, since 2005, has transacted over $3B of carbon offsets to support mitigation projects, especially in developing countries. Despite its success, offsetting has a number of critical challenges:

Inefficient: Due to verification costs, overhead, and profit-taking by third party certifiers, as little as 30% of funds make it to actual projects.

Large and Non-local: To achieve an economy of scale, the VCM is constrained to supporting large, distant and typically “anonymous” projects that offer little meaning or value to consumers.

Lack of Trust: Over 50% of respondents to a Point Carbon survey believe offsetting does not produce real reductions and 70% believe offsetting companies are not transparent in their dealings. Only 35% of respondents to a Mintel survey trusted claims of “carbon neutrality.”

Negative “Story”: Offsetting is often unfavorably equated with greenwashing and 16th century “indulgences”, where parishioners could pay the church to absolve them of their sins.  Offsets are similarly accused of allowing people to buy a clean conscience while delaying meaningful action.

Lack of “Additionality”: To be valid, carbon offset projects cannot result from “business as usual” and must happen because of their access to VCM funding. This is often very difficult to prove and some estimate up to 70% of offsetting projects would have happened even without VCM funding, in which case they’re not really offsetting anything.

Leakage: While standards and measures of accountability have improved, there are persistent concerns around “leakage” where negative environmental impacts of a project are simply moved elsewhere rather than mitigated.

More broadly, offsetting limits how we think about and respond to climate change. Is it really enough for your business to be carbon neutral when the world clearly isn’t? If, by some miracle, every company suddenly decided to offset their emissions, we would quickly run out of mitigation projects to support. And if, by an even larger miracle, humans halted all carbon pollution today, there’s already enough in the pipeline that we’re still going to have to deal with 10+ feet of sea level rise, rampant spread of vector born diseases, declining agriculture and fisheries, millions of environmental refugees, and other consequences of global warming.

Rather than limiting ourselves to carbon neutrality, let’s set broader goals to support a healthy planet for our children and all life. Yes, of course we need to reduce carbon pollution as quickly and as fully as possible. But we also need to do so much more! We need to preserve biodiversity and wildness; we need to develop local and resilient food systems; we need to fight for climate justice; and we need to deconstruct and replace the political and economic systems that got us into this jam in the first place. We can’t support any of this through offsetting.

Recognizing these challenges, a social venture called Earth Deeds has developed a new option called “onsetting” that drops the controversial claim of carbon neutrality, prices emissions based on the Social Cost of Carbon, and enables funding to support local and meaningful sustainability projects that are responding to climate change.

Rather than “neutralizing” our environmental “sins” through carbon offsetting, the idea of onsetting is to…

  1. recognize and appreciate all that fossil fuels have enabled;
  2. reduce carbon pollution wherever possible;
  3. internalize the externalized costs of burning fossil fuels; and
  4. ‘pay forward’ these costs in ways that can help heal our world.

Onsetting resolves the problems of offsetting and offers the following benefits:

  • Increased Efficiency: By avoiding costs associated with third-party verification and other middlemen, at least 85% of funds can be sent to the projects.
  • Support for Small, Local and Non-mitigating Projects: Companies can search Earth Deeds’ extensive database of projects or, better yet, they can locate (or create!) local projects that fit with their mission and values. And because onsetting is not about buying “neutrality”, funds can also support projects that do not directly mitigate CO2 emissions, such as education and social justice programs.
  • Trust in the Process: All transactions are transparent, use of funding is local and visible, and concerns around additionality become irrelevant.
  • A Positive Story: Through easy-to-use online tools, businesses can measure their emissions and generate positive stories of accounting for their environmental costs and giving back to their communities and the planet.

By working with Earth Deeds, companies can increase their CSR and their philanthropic impact. For example, CISabroad onset emissions from their study abroad programs and supported local environmental projects in 14 of their host communities. Citizens’ Climate Lobby used Earth Deeds for their annual appeal to members who onset their emissions to support CCL’s lobbying for a national carbon fee and dividend program.

Imagine employees onsetting their commuting and supporting sustainability projects in their local communities. Or envision a company channeling its corporate philanthropy through Earth Deeds to create matching grants for other groups to onset their emissions and support projects that have meaning to that company. With Earth Deeds, companies can increase their employee and community engagement, amplify their giving through attracting matching funds, and build awareness and action around climate change.

Global warming is likely the greatest threat humans have ever faced and it is unfolding in our lifetimes. Earth Deed’s “big solution” is empowering the millions of people and projects working now to create sustainable communities and healthy ecosystems. Let’s work together to support the positive changes we wish to see in the world.
Daniel Greenberg, Ph.D. is founder and CEO of Earth Deeds, L3C, a social venture whose mission is to create a healthier planet by helping organizations “onset” their CO2 emissions and support local solutions to global warming. Daniel previously founded Living Routes, a non-profit that enabled students to study abroad in ecovillages. For more information please visit earthdeeds.org or contact daniel@earthdeeds.org.

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