A partial defence of carbon offsets


in Economics, Politics, Science, The environment

Harbour Centre, Vancouver

Everybody compares carbon offsets with the indulgences of the medieval Catholic Church. Indeed, a good number of people seem to treat the comparison as the decisive point against them. Offsets allow one person to ‘sin’ by flying or driving a big car, then pay for it by having someone else reduce emissions by a similar amount. While there is certainly potential for abuse, the real issue here is about the intuitive sense of fairness people possess.

Obviously, if someone buys an offset that produces no real reduction in emissions, they have been bilked and the climate has suffered. There are plenty of cases of dubious offsets, including all those based around planting trees. Furthermore, it is necessary not only for the sale of the offset to lead to reduced emissions: it must lead to a reduction of emissions equivalent to the face value of the offset and, crucially, these must consist entirely of reductions that would not otherwise occur. The perfect offset is something like this: (a) a farm releases large amounts of methane, a powerful greenhouse gas (b) in the normal run of things, the farm would have no incentive to stop doing so (c) the sale of offsets changes the economics of the situation, making it most economically efficient to capture the methane, perhaps using it to generate electricity (d) this produces a quantity of real and verifiable reductions that can be sold at the marginal cost of capturing the methane.

In this situation, the argument of ineffectiveness does not apply. What we are left with is the offence against fairness – allowing one person to ‘take more than their share.’ While there is intuitive force behind this position, I don’t think it is very convincing. While it would be better to both moderate one’s consumption and help others to do so, it does seem less objectionable to emit and purchase credible offsets than to emit and simply ignore the consequences of your actions. The critical difference between offsets and indulgences is that offsets (when used properly) actually have a mitigating effect on total greenhouse gas emissions; indulgences never did anything at all, except raise money for those selling them and the ire of those opposed.

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{ 22 comments… read them below or add one }

Tom January 22, 2008 at 10:57 am

Is it better to drive a Hummer and buy offsets than just to buy a Hummer? Probably.

Is it acceptable to switch from a little Toyota to a Hummer and cover the difference with offsets? No.

Offsets might be a way to limit the consequences of activities that you would simply refuse to not do. They cannot be permitted as a way of making optional emissions seem acceptable.

tristan January 22, 2008 at 11:01 am

I think it’s wrong to think of everyone as having a “right to pollute” some specific amount. No one has a right to pollute, no one has a duty to offsets – until those rights and duties are created in law.

Milan January 22, 2008 at 12:53 pm

What is the problem with equal per-capita emissions as a starting point?

What system do you think is more appropriate?

Alex January 22, 2008 at 2:50 pm

There seems to be one crucial difference though between indulgences (which the Catholic Church still gives out) and carbon offsets. Indulgences never “allow” one to sin but only forgive one certain sins ia a crucial prerequisite is met: personal repentance and the will to change one’s behaviour. Carbon offsets do not come with a similar package of expectation or demand.

Alex January 22, 2008 at 2:51 pm

There seems to be one crucial difference though between indulgences (which the Catholic Church still gives out) and carbon offsets. Indulgences never “allow” one to sin but only forgive one certain sins if a crucial prerequisite is met: personal repentance and the will to change one’s behaviour. Carbon offsets do not pose a similar demand on the recipient.

Anon January 22, 2008 at 3:15 pm

Depending on one’s defiitions, it is possible to avoid sin.

As long as we keep breathing, we cannot avoid carbon dioxide emissions.

As such, it makes sense to think we have a guilt-free allotment of some emissions.

tristan January 22, 2008 at 9:24 pm

The problem with equality is that it is arbitary, it’s like the first 103 seminar when we had to divide a cake. There is no prima fascia reason that numerical equality is just. There is only a problem, there is no “provisional answer” until a real solution is offered. Numerical equality is the false semblance of a simple solution so we can put off the real work of distributive justice.

tristan January 23, 2008 at 12:33 am

For example,

If it is the case that some countries have exploited others at their own benefit to significant extents, in ways that remain relevant to the current generation.

And if it is the case that to become richer, to have more benefits, at a cheaper price, requires producing more carbon.

Then it is in no way obvious why there should be any parity at all between the rights of different countries to pollute.

The point is, of course, no one has a right to pollute. There is no allotment that everyone has a little bit of. Rather, everyone has a right to pollute, but a duty to minimize their pollution to the greatest degree that can be considered reasonable. “Considered reasonable” must be evaluated in terms of how many initial resources was one given, in comparison to others who had less initial resources. We must also consider the ongoing exploitation of some states by others in this “allotment” which is not an allotment but a comparison of rights and duties (rights accorded to individuals as particular, duties accorded to individuals as universal).

. January 23, 2008 at 10:08 am

Opposing market solutions to climate change: Climate Justice tour

The Durban Group for Climate Justice (http://www.carbontradewatch.org/durban/) is a network of dozens of environmental groups who see “carbon trading”, the centerpiece of world’s governments approach to climate change, as a false solution, a neo-liberal scam that harms communities and distracts from real change.

tristan January 23, 2008 at 1:13 pm

“indulgences never did anything at all”

I like how science reduces the PROTESTENT REFORMATION to a few people being irritated. “That’s just contingent”.

. April 4, 2008 at 3:39 pm

“While carbon offset programs sound like a good deal for the environment, their impact is not as straightforward as it seems. In fact, such programs may not do as much good as people think.

The motivation behind voluntary purchases of carbon offsets can be compared to making charitable contributions, says economist Matthew Kotchen at the University of California at Santa Barbara. People must receive some private benefit — such as feeling a “warm glow” or gaining social approval — from providing a public good. Otherwise, why would they bother to take measures to forestall climate change, knowing that others can benefit from their efforts without lifting a finger?

Unlike donations, however, the purchase of carbon offsets is an effort to clean up one’s own actions. That could lead to more carbon-intensive activities if offsetting makes people feel less guilty about global warming. For instance, those who would otherwise buy a Prius may go for a Hummer instead if they can offset the latter’s carbon dioxide emissions. Or a household may consume more electricity if they know that they can easily make up for the environmental impact by buying more carbon offsets.

If people voluntarily purchase carbon offsets, that must mean the offsets are “cheaper” than the guilt they feel over their carbon footprint, notes University of Melbourne economist Joshua Gans. The lower the price of the offset, the more easily they assuage their guilt. If a consumer’s electricity use is no longer constrained by guilt, then he might end up consuming more electricity. “

. April 4, 2008 at 3:39 pm

“Moreover, if the money that comes from offsetting “dirty” electricity goes to investing in wind or solar energy, then increased competition from “green” electricity may also provoke incumbent power companies to drop their prices and produce more “dirty energy.” The lower prices that result could increase overall electricity consumption by all households. Hence, trying to do something good for the environment might inadvertently encourage the sort of behavior that is anathema to someone worried about carbon emissions in the first place.

In a recent paper, however, Gans finds that it’s unlikely that carbon offset programs would do more harm than good. He argues that the ability of green power to pressure utilities into lowering prices depends on the volume of offsets for building that green power capacity. The price effect would be small if only a few people subsidize a wind farm. But if a large number of people purchase offsets, then a huge amount of green power would be available. This is more likely to displace dirty electricity than to provoke more of it. “

. April 4, 2008 at 3:40 pm

“Net emissions of carbon dioxide will likely fall as a result of carbon offsets, but Gans suggests that the reduction is probably not as large as offset purchasers think. “They’re not wiping them out entirely,” Gans says.

The biggest limitation of carbon offsets in addressing climate change lies in its nature as a public good: A voluntary means of curbing carbon emissions can only go so far. “[It] creates the false impression that global warming can be tamed by voluntary efforts,” wrote Judge Richard Posner late last year in his blog shared by economist Gary Becker, both at the University of Chicago.

The compulsion to free-ride is just too strong. “I think that [carbon offsets programs] can have a meaningful contribution, but they’re not to be thought of as a solution [to climate change],” Kotchen says. How much they are contributing to the environment isn’t clear, he notes. The complexity of behavioral and industry responses means that more research is needed. “

. April 22, 2008 at 11:12 am

Eco-Guilt and Carbon Offsets

The Gold Standard adds three special screens to provide this quality control by asking:

1. Does the project use renewable energy or energy efficiency technologies (so that the focus is on reducing emissions)?
2. Does the project go above and beyond a “business as usual” scenario (so you’re not paying for something that would have happened anyway)?
3. Does the project promote sustainable development (is the local community involved and benefitting from the project)?

Companies that sell Gold Standard offsets include Planetair, Less, My Climate, Sustainable Travel International, Climate Friendly, and Atmosfair.

. January 2, 2009 at 1:56 pm

This house believes that carbon offsets undermine the effort to tackle climate change

Carbon offsets are designed to reduce emissions by allowing countries, companies or individuals to purchase “offsets” to reduce their carbon footprints. However, critics argue that rather than encouraging the fundamental changes to lifestyle and corporate behaviours necessary to tackle climate change, carbon offsets provide a convenient loophole to appease regulators and personal consciences. Do carbon offsets really reduce emissions or are they a cynical effort to ignore the problem?

55% voted yes
45% voted no

. May 22, 2009 at 2:15 pm

Gary Mason
Carbon offsets: It really isn’t easy being green

Even the corporation’s chief executive officer concedes that when it comes to regulations, the offset industry resembles the Wild West.

“I think it’s fair to say that not all offsets are created equal,” CEO Scott MacDonald said the other day. “The quality of the offsets can vary pretty dramatically. Some are more easily measurable than others. We’re looking for those with the highest level of predictability and assurance. We won’t compromise the standards that have been set by our Ministry of Environment.”

Sounds wonderful in theory. But Mr. MacDonald concedes his Crown corporation is just dipping its toes into this whole business. It recently purchased its first bundle of offsets from a B.C. company. It will soon have to embark on a more ambitious purchasing regime if the B.C. government is going to meet its target of becoming carbon-neutral across all of government-related bodies in the next few years.

Phase one is to offset emissions generated by government travel, estimated to be about 35,000 tonnes annually. The credits just purchased by the trust will allow the government to offset 330,000 tonnes of emissions over five years, more than enough to neutralize the emissions created through travel.

. June 9, 2009 at 1:48 pm

Hostage to fortune

Jun 8th 2009
From Economist.com
Trading carbon credits based on avoided deforestation

TREES are one of the most efficient systems of carbon capture and storage on the planet. They breathe in carbon dioxide and breathe out oxygen, locking the carbon into their roots, trunk, branches, twigs and leaves and the soil. They are so good at this that about 20% of the greenhouse gases entering the atmosphere can be attributed to deforestation. In the run-up to the climate talks in Copenhagen in December, bright minds around the world are negotiating a formal scheme for reducing the loss of trees as a way of lowering the world’s carbon emissions.

Avoiding deforestation means that many landowners must forgo the right to cut down their trees, so that the world at large can benefit. As such, carbon emissions from deforestation are a classic example of “environmental externality”. So long as this remains the case, forests will continue to be cut down. To resolve the problem, it has been suggested that the people who forgo their rights are compensated. There is already a market for what are called “voluntary” credits in avoided deforestation.

. July 15, 2009 at 5:54 pm

Pulling Yourself Off the Ground By Your Whiskers
Posted July 14, 2009

Here is the simple mathematical reason why large scale carbon offsets can’t work

What I am about to explain is the simple mathematical reason why any largescale programme of offsets is injust, contradictory and ultimately impossible.

. July 22, 2009 at 8:07 pm

Related post:

Ranking the quality of carbon offsets
July 21, 2009

. November 18, 2009 at 2:07 pm

No Free (CO2) Lunch for Frequent Fliers?

Elisabeth Rosenthal has a fascinating story in The Times examining the growing debate over whether there’s a legitimate way to ride an Airbus or 777 without remorse over the resulting emissions of greenhouse gases. The piece focuses on the green tourism company Responsible Travel and its decision to cancel the carbon offsets it had offered since 2002, through which money flows to projects avoiding emissions as a way to compensate for all the tons of CO2 flowing from big jet engines. A top company official said it appeared that such offsets could actually be encouraging more flights over all:

“The carbon offset has become this magic pill, a kind of get-out-of-jail-free card,” Justin Francis, the managing director of Responsible Travel, one of the world’s largest green travel companies to embrace environmental sustainability, said in an interview. “It’s seductive to the consumer who says, ‘It’s $4 and I’m carbon-neutral, so I can fly all I want.’ ”

There are plenty of other companies still offering offsets, including Terrapass, where you can currently get an offset package sufficient, the company says, to compensate for four short, three medium, and two long-haul flights for $50.60.

Paying More for Flights Eases Guilt, Not Emissions

Published: November 17, 2009

In 2002 Responsible Travel became one of the first travel companies to offer customers the option of buying so-called carbon offsets to counter the planet-warming emissions generated by their airline flights.

But last month Responsible Travel canceled the program, saying that while it might help travelers feel virtuous, it was not helping to reduce global emissions. In fact, company officials said, it might even encourage some people to travel or consume more.

“The carbon offset has become this magic pill, a kind of get-out-of-jail-free card,” Justin Francis, the managing director of Responsible Travel, one of the world’s largest green travel companies to embrace environmental sustainability, said in an interview. “It’s seductive to the consumer who says, ‘It’s $4 and I’m carbon-neutral, so I can fly all I want.’ ”

Offsets, he argues, are distracting people from making more significant behavioral changes, like flying less.

. November 23, 2009 at 5:18 pm

They tell the story of Responsible Travel, a company who were one of the first to offer carbon offsets to travelers wanting to lessen the impact of their flights. That company has now canceled the program. The managing director explained, “The carbon offset has become this magic pill, a kind of get-out-of-jail-free card.” He wants people to make more significant behavioral changes (like the 10:10 scheme perhaps). Yahoo and the House of Representatives similarly embraced this thinking, concluding that money allocated for offsets would be better spent on improving their buildings’ efficiency. Of course, donating money to balance the impact of the emissions you help create can be done, but a fee in the region of $200-300 dollars would be required to offset for a flight to London, something few are prepared to pay. And quite simply, no amount of money will make our insatiable appetite for air travel sustainable.

. December 17, 2009 at 10:13 am

“But Michael Wara, an expert on environmental law at Stanford University, argues that it is in practice impossible for the board to know that the projects they approve would not have happened otherwise, and indeed some of the projects that have been financed look as though they might have. He cites some 20 gas-fired power stations in China that were partly financed by the CDM (and thus, indirectly, by European consumers). Given that China long ago announced its intention to diversify out of coal for reasons unconnected with climate change, he reckons that those power stations would have been built anyway, so the emissions cuts they led to were not additional. Senator Corker shares his scepticism about offsets. “That’s not a market,” says the senator. “That’s Alice in Wonderland make-believe.””

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