Request a callback
  • We provide support to over 500 businesses for energy and carbon management

Carbon Offsetting: The Last Resort

6th May 2021
With a flurry of new international commitments from governments as they position themselves ahead of COP26 in the autumn, the importance and priority that should be associated with carbon offsetting is again to the fore.

But there seems to remain a degree of confusion as to where is the right time and place to deploy them as part of the armoury of tools on the journey to decarbonisation. And so, we wanted to take us back to first principles to explain what carbon offsetting is and why in our opinion it is a useful tool in some circumstances but by no means the solution.

What is Carbon Offsetting?

In essence, it’s a reduction initiative performed by a person or organisation to compensate for carbon emissions generated elsewhere. Carbon offsets are measured in tonnes of carbon dioxide equivalent (CO2e).

There are two types of markets for carbon offsets, compliance and voluntary. In the compliance market like the European Union (and now the UK) Emission Trading Scheme; companies, governments and other entities buy carbon allowances through auctions to comply with mandatory caps on the total amount of carbon dioxide they can emit per year.

The voluntary market demand for offset credits is generated by individuals or organisations who purchase carbon offsets to mitigate their greenhouse gas emissions to meet carbon neutral or net-zero goals.

There are a variety of different projects circulating in the voluntary market to achieve carbon reduction objectives. Offsets typically support projects that either reduce the emission of greenhouse gases in the short and long-term or which remove carbon dioxide from the atmosphere. A common project type is renewable energy, such as wind farms, biomass, biogas digesters, or hydroelectric dams. Other projects include energy efficiency projects like efficient cookstoves for developing countries, the destruction of industrial pollutants or agricultural bi-products, destruction of landfill methane, and forestry projects such as the National Trust tree planting scheme.

Planting trees, surely that’s the answer?

Forests are one of our best lines of defence against climate change and restoring them is crucial, but this cannot be a substitute for reducing carbon emissions directly.

A newly planted tree can take as much as twenty years to capture the same amount of CO2 that a carbon offset scheme promises. Organisations would have to plant and protect a massive number of trees for years to offset a fraction of global emissions. Furthermore, there is the risk that these efforts will be wiped out by droughts, wildfires, tree diseases and deforestation.

When trees and plants die, most of the carbon they have trapped in their trunks, branches and leaves returns to the atmosphere. Changes in the climate mean that droughts and higher temperatures will strain forests in the future. The risk is that trees planted as part of offsetting projects could become a source of emissions if they die prematurely.

The challenge is to lock up the carbon for longer periods, which means that the best trees to plant are either those that have a long life (such as oak) or those that will be used as building materials when they are felled.  If the plan is to use the wood as fuel, then there should be a commitment to capture and store the CO2 produced.

Another way of locking up carbon is through bogs where generations of plants absorb carbon from the atmosphere, but do not release this when they die due to the preserving effects of the acidic water where they grow.  Converting atmospheric CO2 is a great way to lock up carbon – as long as you don’t decide to burn it or allow it to decompose by spreading it on your garden!

What can I do instead of carbon offsetting?

There are plenty of alternatives and pre cursers to offsetting carbon. The first step is to understand your carbon footprint – you can’t determine the success or failure of projects unless you can measure the ‘before’ and ‘after’ emissions. The second step is to put together an actionable long-term decarbonisation strategy, which may include consumption reduction technologies, behavioural programmes, green procurement strategies, and renewable technologies.

There is no doubt that when correctly used carbon offsets can slow and avert climate change. But they are not a get-out-of-jail-free card. There is no way that we could offset our way out of this environmental crisis without first tackling our unsustainable consumption and actioning reduction plans to first reduce organisations carbon baseline before offsetting that which cannot be reduced.

The financial Risks of Carbon Offsetting

The Committee for Climate Change, which advises the UK Government thinks that there are not enough carbon offset opportunities in the UK to achieve our 2050 Net Zero Carbon goals and so the UK will need to start to implement carbon capture and storage projects to provide the final offsets.  Such technology is expensive and, combined with a lack of supply of carbon offsets will inevitably mean that the cost of carbon offsetting will rise dramatically over the coming decades. Organisations may currently think that carbon offsets are a cheap and easy way to meet sustainability targets but will this still be the case if those offsets are potentially ten times higher long before we get to 2050?

To hear more about how your organisation can implement an actionable and long-term decarbonisation strategy call one of our experts on 01253 785294

Sustainable Energy First, has acquired Inenco.


The acquisition brings together two businesses with one common objective;
to make truly renewable
energy more accessible to businesses of all sizes helping them achieve their Net Zero targets.

If you need to access the Inenco website, you can press Esc or close this box and navigate to the page you need.
To find out more about this acquisition please click the button below.