What are the problems with carbon offsetting?
There are number of problems with carbon offsets. Some of these include
- it is not paying the true cost of decarbonisation
- it focuses on 'easy wins' and things already happening, not additional
- it's not preventing actual carbon cuts
Cost of decarbonisation vs prices of carbon offset
One of the major criticisms of offsetting is that it involves false equivalences. The basic idea behind it was that you may as well pick the low-hanging fruit first – the cheap, easy wins. Its cheerleaders were fond of saying “the atmosphere doesn’t care where you make emission cuts”.
But the thing is that, over time, the atmosphere does care (metaphorically speaking), because some cuts are more sustainable in the long term. Some enable you to make more cuts. Some are just harder to do.
This becomes clear when you look at prices. An international group of economists called the High Level Commission on Carbon Prices estimated in 2017 that to incentivise the changes required to reach the 1.5 degree Paris target, a carbon price of at least £37-74/tonne would be needed in 2020, rising to £46-£92 in 2030.
Yet voluntary offset prices are an order of magnitude lower – around £3-5/ tonne. This makes it very visible that offsetting almost by definition doesn’t involve paying a fair share of the cost of decarbonisation.
When you have to pick all the fruit, picking the low-hanging fruit is not equivalent to climbing the tree to pick the harder fruit, or getting started on making the ladder you’re going to need to reach it.
It is also this fact – that offsetting is aimed at picking the low-hanging fruit, that is one of the reasons why it is so plagued with accusations of fraud.
Few 'additional' schemes, and low achievement rates
Easy things are often not meaningful things. If something is very easy, its ‘additionality’ can start to look dubious, as people may well have done it anyway. It may be plagued with ‘leakage’, because it probably isn’t addressing deep underlying problems, so symptoms just get shifted around.
And to make it worse, offsets are a uniquely abstract commodity – they only exist relative to an idea of what would have happened without them, something which nobody knows. Recent research by academics and the Guardian have suggested that many anti-deforestation offsets are in areas that would not have been deforested anyway. The easiest place to prevent deforestation is, indeed, where nobody is trying to deforest in the first place.
Again, looking at prices can be instructive – UK land-based offsets generally cost £10-20/tonne, while the Climate Change Committee estimates that UK afforestation will cost £65-105/tonne in 2035. As the Committee says:
“Some present prices are lower than might be expected, suggesting that they may not be fully reducing/removing the quantity of emissions they claim, providing fairly strong evidence of failed additionality and over-claiming.”
The 2016 European Commission report referenced above, which looked at Clean Development Mechanism offsets, estimated that only 2% of the projects and 7% of the credit supply had a high likelihood of cutting the carbon claimed.