Input: CARBON NEUTRALITY
Is Carbon
neutralIty a myth
or a realIty?
Many firms are keen to offset their carbon footprint, but are Offsetting standards
they really looking at all the options to make sure they’re
getting the best value, and not just paying lip-service to
VERs can be used to cost effectively balance your carbon footprint,
the concept? Robert Oden and Jill Barker, from emission
as they can offset the emissions that you currently cannot reduce by
reduction company EcoSecurities, examine the options
internal abatement measures alone. VERs are the main type of emission
and select some working examples.
reduction used by companies wishing to offset their unavoidable
emissions. In order to ensure that buyers of VERs are purchasing
T
he idea of corporate carbon neutrality dates back to a real emission reduction, VERs must be calculated according to
the mid 1990s, but it wasn’t until relatively recently that a VER Standard. There are several VER Standards currently being
a critical mass of companies began making high-profile used throughout the world, each sets out different rules governing
commitments to neutrality. the project types that are acceptable and the measurements of
emission reductions. Standards are important because they provide
But what, if anything do these commitments actually
assurance for buyers of VERs. Because buyers generally pay more
accomplish?
for VERs verified to stricter standards, each GHG emissions reduction
project has the incentive to strive towards meeting the highest quality
A claim of carbon neutrality should indicate three things. First;
standards. The most influential standards currently in use within the
that an entity has taken the step of estimating its “footprint”,
industry in the UK include the Voluntary Carbon Standard (VCS),
second; that it is committed to reducing that footprint through
VER+ and WWF’s Gold Standard.
introducing greater efficiency in its operations, and third; that it
has acted to offset whatever components of that footprint it can’t
Before offsetting
reduce directly at once. This will likely be through an investment
in Verified Emission Reductions, or “VERs”. VERs represent the Often the first two steps of neutrality are overlooked because
emission reductions from greenhouse gas emission reduction it is the offset purchase part of the process that is the most
projects that have prevented or removed the equivalent of one visible. But these first two steps are critical, as they provide the
metric ton of carbon dioxide. Just as emissions from every corner framework for working towards carbon neutrality. A company’s
of the globe add to the increasing concentration of greenhouse footprint is not at all intuitive (what else in our lives is denominated
gases (GHGs) in the atmosphere, emissions reduction projects in tons of invisible gas?) and the process of calculating it is an
are equally beneficial regardless of their location. As long as the important step in a company’s education about what activities
reduction is real, verifiable and permanent, the positive impact contribute to GHG emissions in general, and how much impact
on the environment will be the same. its particular operations have. With soaring global energy prices,
footprints can highlight undiscovered opportunities not only to
GHG emission reduction projects create VERs by displacing
reduce emissions but also to increase efficiency and cut costs.
more fossil fuel intensive activities or by reducing the direct
Even if a company hasn’t explicitly taken these steps towards
release of GHGs into the atmosphere. For example, a pig farmer
direct abatement of emissions, the fact that it has committed to
in the Philippines can reduce emissions and generate VERs by
pay for offsets presumably will lead to a search for less expensive
trapping the methane released from his pig waste and using it to
long-run alternatives that are available internally.
generate electricity. This also reduces his need for electricity from
the grid and thus from fossil fuel based power. By selling VERs The fact that the carbon markets make the third part of the
to companies wishing to offset their emissions in the developed carbon neutrality equation relatively easy exposes the entire idea
world, he generates an income in addition to his power-cost of neutrality to unfair criticism. The truth is that the offsetting part
savings, which helps to make his project economically viable. is often not as easy as it sounds. It also carries significant risks,
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