7 Reasons Why Carbon Offsetting Doesn’t Actually Work

✔ There’s currently no standardised way to measure carbon offsets

✔ It takes an average of 20 years for tree saplings to become viable for carbon offsetting 

✔ 90% of the offsets sold by the world’s biggest provider did not actually reduce emissions

Carbon offsetting has become popular with companies that want to reduce their carbon emissions.

It’s particularly popular with airline companies, but a lot of large corporations, such as Google and Disney, have also used carbon offsets in recent years. Some governments have even been looking to carbon offsetting to help meet emission reduction targets.

But what exactly is carbon offsetting, and why might it not always be effective? We’ll give you seven reasons why in this article, and tell you about some big companies that have incorporated carbon offsetting into their sustainability strategies.

What is carbon offsetting?

Carbon offsetting is when a business, individual, or country compensates for the carbon emissions they produce by funding schemes or projects that are supposed to reduce carbon emissions. This is sometimes called purchasing ‘carbon credits’.

The idea behind carbon offsetting is that, by funding activities that reduce carbon emissions, you can ‘cancel out’ the emissions you produce. Resetting the balance, if you will, so the amount of carbon dioxide (CO2) in the atmosphere stays the same.

Common types of carbon offsetting schemes include reforestation projects, renewable energy development, and research into carbon capture technologies.

The organisations that run carbon offsetting projects calculate the amount of carbon that’s reduced or avoided through their activity. The amount is then usually verified by a certified third party, who sells them as carbon credits.

Does carbon offsetting work?

Carbon offsetting doesn’t work in most cases. In fact, some of the most popular carbon offsetting programmes have been proven not to reduce as much – if any – CO2 as they promise.

A recent example of this is Verra, the world’s largest carbon offsetting certifier. An investigation by journalists at The Guardian in 2023 found that more than 90% of carbon credits sold by Verra did not reduce emissions.

Another example is the United Nations’s (UN) Clean Development Mechanism (CDM). In 2017, the European Commission released a study showing that 85% of the carbon credits previously purchased from the CMS by the European Union (EU) did nothing to reduce emissions.

The European Parliament subsequently banned these credits from qualifying as carbon reduction measures for EU countries in 2021.

Why doesn’t carbon offsetting work?

The main reason why carbon offsetting doesn’t work is because it’s difficult to predict how much CO2 will be saved through a given project.

This means the estimates used to calculate carbon credits are often overly generous. In short, not as much carbon is actually being reduced as we think.

But there are many other issues with carbon offsetting, which we’ll get into in the following sections.

1. Carbon offsets are difficult to measure and quantify

Carbon offsetting relies on the assumption that an equivalent (or greater) amount of CO2 is being removed than the amount being produced. But in most cases, carbon offsetting projects overestimate their impact.

This is in part because there’s no standardised system for determining what counts as a carbon offset, or how to measure it. But it’s also because it’s difficult to predict what will happen in the future – some carbon offsetting schemes for example don’t last, since they can be disrupted by changing government policies, or natural disasters.

This can lead to disputes about how much carbon is being offset during a project, as was the case with Verra. After the Guardian’s investigation, Verra argued that the publication’s calculations were wrong, and that their projects were delivering reductions as promised.

These types of arguments are a reminder that carbon credits lie on very shaky ground. It’s difficult to know how much CO2 is being offset, so we shouldn’t base our entire emissions reduction strategy on them. Businesses, individuals, and countries should focus their plans on actually reducing emissions, rather than offsetting them.

2. Some carbon offset projects would have happened anyway

Carbon offsets don’t count if they would have happened anyway, without the scheme. To put it another way, they need to be in addition to ongoing environmental plans happening in the world.

For example, if more solar panels would have been created with or without the carbon offset scheme, then this does not count as an offset.

The study into CMS by the European Commission looked at just that and found that “most energy-related project types (wind, hydro, waste heat recovery, fossil fuel switch, and efficient lighting) are unlikely to be additional”. This was one of the areas where the CMS offsetting program failed to make an impact.

Of course, it’s very complicated to determine and prove this additionality – another reason why carbon offsetting is an unreliable system for reducing carbon emissions.

3. Carbon offsetting doesn’t start to work soon enough

Given the urgency of the climate crisis, many carbon offsetting critics argue that measures, such as planting trees (the most popular type of carbon offsetting) won’t help reduce emissions soon enough.

Greenpeace notes that: “A newly planted tree can take as many as 20 years to capture the amount of CO2 that a carbon offset scheme promises. We would have to plant and protect a massive number of trees for decades to offset even a fraction of global emissions.”

Basically, carbon offsets might be too little, too late. Trees planted now would only become viable carbon offsets around 2050, the deadline set for reaching net zero emissions in the 2015 Paris Agreement.

4. Most carbon offset schemes don’t last, especially reforestation projects

In order to have an impact on the environment, a carbon offsetting measure needs to last. But unfortunately, a lot of carbon offsetting schemes don’t stand the test of time.

Trees are particularly vulnerable to destruction – either natural or manmade – which is why it’s worrying that planting them is the most popular form of carbon offsetting.

There are lots of cases where carbon offsetting schemes involving reforestation or preservation have failed over time. For example, a carbon credit programme based in Cambodia saw forest coverage in a preservation area decrease by 42% across the duration of the programme, according to ProPublica.

5. Carbon offsetting is often used as an excuse to not reduce emissions

Unfortunately, carbon offsetting is seen by many as a free pass to not focus on reducing emissions. The ‘easy’ way out, if you will.

The European Commission sums up this sentiment in its description of the failed CMS scheme. It defines it as a scheme that allowed “industrialised countries with a greenhouse gas reduction commitment […] to invest in projects that reduce emissions in developing countries, as an alternative to more expensive emissions reductions in their own countries.”

Essentially, for many big corporations and governments, it’s easier, and cheaper, to push money at carbon offset schemes, rather than doing the work to reduce their own emissions.

6. Most carbon offset schemes shift the responsibility onto the lowest emitters

A lot of carbon offsetting projects shift the burden of responsibility from wealthy developed countries – who produce the most emissions – to low-emitting developing countries.

For context, the average emissions per person in Europe are around 10 tonnes of CO2 per year, and 20 tonnes in North America. By contrast, it’s 2.6 tonnes per person in southern areas of Asia and South-East Asia – and only 1.6 tonnes in SubSaharan Africa.

Not only is passing the burden onto countries with lower carbon footprints a form of environmental injustice, but it also makes it much harder to actually offset carbon emissions.

That’s because high emitting countries produce lots of emissions for a reason, they have developed infrastructure that runs on fossil fuels. Low-emitting countries are still in development, and they want to keep developing. And developing a healthy economy with reliable infrastructure is a stronger financial and social-political incentive than receiving funding to oversee a carbon offsetting scheme.

A recent example of this are the policies of former Brazilian president, Jair Bolsonaro. Under his term, an area of the Amazon rainforest the size of Belgium was destroyed to give more land to the agriculture industry.

7. Carbon offset schemes can harm local populations

The unethical nature of some large carbon offsetting schemes should also make us question their worth. Carbon offset projects – often funded by the wealthier countries around the globe – can sometimes harm local indigenous communities, resulting in violent conflicts, food insecurity, and displacement.

One famous case of this happened in Kenya. A report titled “Blood Carbon” by Survival International details how a carbon offset project that was registered by Verra disrupted the traditional farming practices of indigenous groups, endangering their income and food resources.

This is just one example among many. But it’s particularly egregious when you consider that indigenous groups protect 80% of the world’s biodiversity. According to the UN, indigenous communities play a vital role in mitigating climate change and protecting the environment.

Is carbon offsetting a form of ‘greenwashing’?

Carbon offsetting can be a form of greenwashing if a company relies solely on carbon credits to appear environmentally friendly, and uses this as a substitute to actively reduce its emissions.

Advertising that claims a product or company is ‘carbon neutral’ can mislead customers into thinking the company is reducing their carbon footprint, when they aren’t.

This is the reason why the EU parliament voted to ban the use of unsubstantiated generic terms, such as ‘climate neutral’ from advertisements in March 2023.

But that’s not to say that investing in carbon offsetting is a bad thing, and that the practice should be abandoned.

When done ethically, carbon offset programs can have positive effects, such as protecting biodiversity, or increasing the amount of green energy being produced. But these positive effects can’t counteract continuous high levels of emissions.

This is a sentiment shared by many environmental scientists, such as the director of the Potsdam Institute for Climate Impact Research. In a Guardian interview, he noted that “offsetting can be valuable but only if companies are already cutting their carbon emissions by at least half each decade”.

Which companies have tried carbon offsetting?

Multiple companies, both large and small, have tried carbon offsetting, including Google, Shell, and British Airways.

The good thing is that none of the companies we discuss below rely solely on carbon offsetting to reduce their emissions. But it’s important to remember that some businesses, such as airlines or gas companies, can only reduce their emissions up to a point, since their business models are based on high-emission fossil fuels.

Let’s take a more detailed look at how Google, Shell, and British Airways have used carbon offsetting in the following sections.

Google

Google is one of the largest companies to use carbon offsetting as a way to reduce its emissions. The company claims to be ‘carbon neutral’ – meaning they compensate for all their carbon emissions – since 2007. Environmentalists have questioned the validity of that statement, given how difficult it is to measure the impact of carbon offsetting.

That being said, it’s true that Google is making significant efforts to reduce its emissions, and is aiming to run entirely on green energy by 2030. Their white paper also states that carbon offsets are only used to compensate for unavoidable emissions, not as a substitute for reducing them.

You can find out more about this on our page UK Companies: Who’s Going Carbon Neutral?

Shell

Shell is another company that has reportedly spent more than £367 million on carbon offsetting projects. As an oil company, there’s only so much Shell can do to reduce its emissions, and one solution it’s found is to offer carbon credits to its customers.

But it’s achieving this mainly through “nature-based projects”, such as reforestation, which are known to fail based on the difficulty of maintaining forests in the long term. This has led to many organisations, such as Greenpeace, questioning its claim of offering customers carbon “neutrality”.

British Airways 

British Airways has committed to becoming carbon net zero by 2050. As part of that strategy, like Shell, it offers customers the option to offset the carbon emissions produced by their flights.

Once again, it’s unlikely that these offsets will actually reduce aviation emissions, especially since airline customer uptake for carbon credits is historically around 1%.

But as an airline, there’s not much more British Airways can do in the short term, besides halt all operations and flights, which seems unlikely. A form of sustainable aviation just hasn’t been invented yet.

As part of its other sustainability efforts, the company states that it’s improved its aircraft efficiency, and is investing in research to develop sustainable aviation fuel and carbon capture technologies. Transport is the world’s second most polluting industry, and lowering carbon emissions in that sector will involve a major technological overhaul.

You can find out about how the UK government is planning to tackle aviation emissions by reading our analysis of their Jet Zero Strategy.

Summary

In most cases, carbon offsetting doesn’t work, mainly because emission levels are too high to offset, and it’s difficult to calculate the real impact carbon offsetting programmes will have.

But let’s be clear, there’s nothing wrong with protecting forests and wildlife, providing developing countries with energy-efficient technology, or investing in green energy. We need more of these types of actions.

The danger, however, is believing that doing all of this gives us a free pass to keep producing high levels of carbon emissions. Scientists agree that we need to drastically reduce our emissions to solve the climate crisis – and soon.

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