Climate change is conceivably the biggest threat facing humanity today. For many years now, scientists have warned us about increasing temperatures and its consequences. Today, the consequences of climate change are more evident than ever: Australia’s wildfires, severe floods in Europe, and heavy tsunamis in South America.
Immediate action is necessary to keep global temperature increases below 2°C, research shows that increased levels of greenhouse gas emissions in the atmosphere are the main reason behind extreme weather changes, and an increasingly warmer planet. In an attempt to mitigate climate change and reduce greenhouse gas emissions, governments, corporations, and activist groups have met together at COP and signed the Paris Agreement in 2015.
The Agreement aims at achieving greenhouse gas mitigations, adapting to climate change, and enforcing climate finance. It builds upon the compliance carbon market introduced in the Kyoto Protocol, and provides a framework for a voluntary carbon market, in which companies are encouraged to offset their carbon emissions.
So, what is offsetting and how can companies do it?
Carbon offsetting allows companies to account for their unavoidable emissions by investing in certified environmental projects in order to balance out their own footprints. For companies, carbon offsetting is often one segment of a wider long-term sustainability strategy. Unfortunately, this approach has often been misunderstood and thus criticized. It is important to highlight, that as of right now there is no other alternative that handles unavoidable emissions. Science suggests that without carbon removal schemes, it will be impossible to limit global warming to 1.5°C degrees, therefore carbon offsetting is necessary to achieve a climatic balance.
To encourage carbon offsetting, several initiatives have emerged such as the Science Based Targets Initiative. SBTi defines best practice emissions reductions and net-zero targets according to climate science to encourage companies to become carbon-neutral. In order to offset, and possibly achieve carbon-neutrality companies must do the following:
Once the company has measured its emissions and reduced all possible GHGs, set a reduction target in order to estimate the amount of volume you need. If you do not know how to do this, contact us and we will help you with the calculation.
Choose the standard you would like to purchase credits from. The most verifiable credits are ones which come from Verra (VCS Credits) or Gold Standard (GS Credits). While choosing the standard to purchase credits from, a company must also identify its sourcing capacity. At Strive, we help our clients to structure their sustainability strategy and execution.
Determine the specifications of the project they would like to buy credits from, specifications include location, technology, and vintage. After choosing a location, companies must identify what technology (or type of project) they would like to support. There is a variety of methodologies used in carbon offsetting projects, this ranges from afforestation and reforestation (A/R), forestry management projects, renewable energy projects, or carbon removal projects. Following this, they must explore what is currently on the market with the vintage of their choice. Vintage is the year in which the carbon credit occurred.
Make the purchase! In order to be able to claim that a company has reduced its emissions, it needs to “retire” the credits or have a third party, like Strive, retire them in their name. Retiring means that when the credits are purchased, it is taken off the market forever and thus cannot be resold after claiming reduction.