Basics
- What does carbon neutral mean?
- Why should I be carbon neutral?
- What does it cost to be carbon neutral?
Verified Climate Outcomes
- How do carbon offsets work?
- Aren’t carbon offsets bad?
- What types of carbon offsets are there?
- Which projects are better, emissions reductions or carbon removal?
- Where can I learn more about carbon offsets?
Basics
What does carbon neutral mean?
Carbon neutral means being net-neutral – you still create some greenhouse gas emissions, but you take responsibility for them.
First you measure the emissions you create, for example when you drive, fly, or heat your home. Then you finance projects that reduce the same amount of emissions you create. This neutralizes your emissions. It’s like cleaning up your carbon trash.
Why should I be carbon neutral?
It’s the right thing to do. Our carbon emissions are harming other people and the planet. We reduce that harm when we become carbon neutral.
Eventually, the entire world needs to be net-neutral. Gandhi said: “Be the change you wish to see in the world.” For those of us who can afford it, why not start now?
What does it cost to be carbon neutral?
It depends on your total carbon footprint. For the average person it costs about $20/mo. For businesses, it’s usually about 1/5th of 1% of their annual revenues.
Verified Climate Outcomes
How do carbon offsets work?
Like all markets there’s a supply and demand. It starts when someone demands a carbon reduction (e.g. to lessen or neutralize their carbon footprint).
Buyer – These are individuals, small businesses, and corporations. They want to reduce their carbon footprint for various reasons. Some do so because they are forced to by regulation, others do so because of social pressure, reputation, or a sense of responsibility.
Project Owner – These are people or organizations who manage the carbon projects for many years. They might be a non-profit or farmer.
Project Developer – Internationally recognized carbon offsets protocols – like the ones maintained by Verra or Gold Stardard – are extremely complex. Project owners don’t usually have that expertise to create them. Project Developers are often for-profit companies with deep experience in carbon modeling. They work with the Project Owner to create a project description document, often over a hundred pages long, and submit it to the Registry for approval.
Registry – This is an international nonprofit like Verra or Gold Standard. They maintain standards and trust. They are similar to any other standards setting body, like NIST or ISO. They create the project protocols Project Developers have to follow, review their project description documents, issue carbon offsets, and maintain a registry of which carbon offsets are in circulation and which have been retired from circulation.
Broker / Retailer – This player could be a for-profit or non-profit entity. They connect buyers and sellers, marketing and selling carbon offsets. They help buyers and sellers by reducing risk and accelerate fulfillment.
Aren’t carbon offsets bad?
Some are low quality, but most are high quality. Thankfully, every carbon project is transparent in at least three ways. First, the protocol it follows is open to public comment. Second, the project’s documents are available for public scrutiny. And finally, reports from third-party verifiers are available publicly. This transparency enables humanity to improve how it finances carbon reduction projects.
In addition to transparency, another remarkable aspect is being outcomes focused. When you donate to most nonprofits you don’t know where the money goes or what it accomplishes. When you buy carbon offsets, you are buying a third-party verified climate outcome.
What types of carbon offsets are there?
This chart comes from the paper, The Oxford Principles for Net Zero Aligned Carbon Offsetting. It shows their taxonomy of carbon offsets. Offsets can be grouped into two categories:
1. Emissions reductions – These are projects in which the developer can implement a project that reduces emissions, compared to what they would have been without the project. For example, retrofitting a landfill to capture methane gas or preventing deforestation.
2. Carbon removal – These are projects in which project developers capture carbon from the air and store it somewhere. They might store it for a short time in soil, for a longer time in forests, or for an even longer time underground.
Which projects are better, emissions reductions or carbon removal?
This chart comes from the paper, The Oxford Principles for Net Zero Aligned Carbon Offsetting. It shows how we need both types of carbon offset projects.
A challenge with emissions reduction projects is proving additionality, that the project would not have happened without the carbon finance. Though this is a challenge, these types of projects are incredibly important to finance.
A challenge with carbon removal projects is their cost. Right now, these projects are often 20-30X the price of emissions reductions projects.
The solution that the Oxford team proposes – which we follow – is to invest in a portfolio of different projects. Over time, as the price for carbon removal comes down, we can shift more and more of our portfolio into carbon removal projects.
Where can I learn more about carbon offsets?
Here are three excellent resources: