Category Archives: carbon offsets

Way to keep up, Gwyn

Today’s Report on Business contains an op-ed by Gwyn Morgan, ex-chief of the oilsands giant EnCana, examining the business of carbon offsets. If you can believe it, he builds to the triumphant conclusion that they’re kind of like the indulgences sold by the medieval Catholic Church:

Those looking to buy forgiveness for their eco-sins might heed the words of Dennis Hayes, president of a U.S. based environmental foundation: “The worst of the carbon-offset programs resemble the Catholic Church’s sale of indulgences back before the Reformation. The whole game is in need of a modern Martin Luther.”

Amen brother.

I’m not saying he’s wrong, at least where an awful lot of cheap-and-easy offset schemes are concerned. But this is, what, a two-year-old controversy? Couldn’t he have pushed this forward a bit more?

FTC considers regulating carbon offset claims

What constitutes a “real” carbon offset is so broad a question that I’m not convinced the U.S. Federal Trade Commission is capable of setting meaningful rules that would cover all circumstances, particularly since it’s inherent in the concept that it’ll evolve constantly and quickly. But the FTC considering giving it a shot, according to the New York Times:

The F.T.C. has not updated its environmental advertising guidelines, known as the Green Guides, since 1998. Back then, the agency did not create definitions for phrases that are common now — like renewable energy, carbon offsets and sustainability.

For now, it is soliciting comments on how to update its guidelines and is gathering information about how carbon-offset programs work…

The F.T.C. has not accused anyone of wrongdoing — neither the providers of carbon offsets nor the consumer brands that sell them. But environmentalists say — and the F.T.C.’s hearings suggest — that it is only a matter of time until the market faces greater scrutiny from the government or environmental organizations.

Environmental organizations have been scrutinizing the market closely, pointing out greenwashers, and developing their own standards for a long time. There’s big money directly involved here, and often big companies are paying it — they damn well want to know that their money is being well spent.

Not that government doesn’t have a role to play if people are outright lying and defrauding customers, but let’s not pretend the FTC is the first group of people to check into the question.

Real, honest, true carbon offsets

Good news from the carbon-offset front: a serious attempt to set standards to distinguish real offsets from fly-by-night phoney ones is bearing fruit. The Voluntary Carbon Standard project has released its documentation (PDF) for how to prove you’ve got the real deal, based on the International Standards Organization’s nascent standard.

VCS isn’t the first to the market, but it’s aiming at a broad spectrum of potential offset-producers, including with a special category of oversight for so-called microprojects that would offset 5,000 tonnes or less of CO2 and equivalents per year. That’s a long way from giving you tradeable carbon credits for taking the bus instead of driving to work, but it’s big news if you’re anybody smaller than General Electric or Yahoo! or somebody, hoping to get into the offset business, and of course most of us are.

The main thing keeping offsets from being a legit way to make up for some of the evils we do is that they’re often unverifiable — God only knows what many self-described offset providers do with your money. Maybe nothing, or maybe they hire some shady characters overseas who’ll promise to plant trees that won’t last more than a season or two. Many are worthwhile, or at least are honest attempts to be, but that’s obviously not good enough if you’re a major corporation that wants to buy quite a lot of offsets that will stand up to serious scrutiny, or you’re an investor looking to front some money in exchange for offsets that you hope will be worth more later.

Goldman Sachs and Cantor Fitzgerald are in on this on this thing. The VCS project, like the Gold Standard, is a necessary step in making functioning markets in offsets that turn money into environmental improvements — and environmental improvements into money.

Green capital over green labour



Photo credit: “Missing man formation,” Flickr/Howard_N2GOTI’m reading the British historian Richard Overy’s analytical history of the Second World War, Why the Allies Won, and a couple of days ago (on Remembrance Day, in fact) I ran across one of those passages that makes you put a book down because what you’ve just read suddenly makes you see the world in a different way.

It’s in a chapter on the effectiveness of the Allied bombing campaign in Germany in the years before D-Day, which is no small controversy in Ottawa. While the campaign killed an awful lot of civilians, Overy concludes that it was important in bringing the Reich to its knees. He doesn’t get into the moral calculus of whether the campaign was worth it, just argues that it worked.

Among other things, Overy writes on page 157 of the paperback edition,

Bombing … permitted Britain and the United States to bring their considerable economic and scientific power to bear on the contest. The campaign was capital intensive, where the great struggle on the eastern front was based on military labour. This suited the preferences of the west, which did not want to place a much higher physical strain on their populations. For all the criticism directed at the waste of resources on bombing, the whole campaign absorbed, according to a postwar British survey, only 7 per cent of Britain’s war effort. (Italics mine.)

In the East, that is, where the German army crashed against the Red Army in grinding battles that pitted millions of men against each other at a time, the battle largely depended on who could throw more men onto the field. In the West, the fight was a contest between engineers and managers — victory depended on which side was was smarter and better-equipped (in a grand sense) rather than on which side was tougher and more numerous.

So fine. Why am I writing about it here?

Environmentalism rose into the modern public consciousness out of the social-justice movements on the left, drawing on the idea that it was intrinsically sinful, in some sense, to consume more than you absolutely needed. You escape the evil capitalistic machine by growing your own food, sewing your own clothes and refusing to buy soap, and the natural inefficiency of trying to squeeze everything into a 24-hour day — substituting your labour for the more productive, yet more environmentally damaging tools of capitalistic production — causes you do do with less.

This particular touchy-feely greeniness fit in perfectly well with the anti-establishment radicalism of the 1960s.

Yet this has turned out to be a less-than-perfect marriage. In Canada, lefties are having an ongoing struggle trying to figure out what they think of the ongoing decline of the auto industry, for instance. We’re hemorrhaging high-paying union jobs, which is bad, but those union jobs are engaged in making consumer-grade light trucks … which are also bad. The left-wing NDP has sidestepped this problem by blaming protectionism in Asia for the industry’s troubles, but it’s not a terribly convincing approach from a generally protectionist party.

Nevertheless, if you don’t have to translate these clashing ideals into actual government policies, economic leftism and environmentalism it still fit very well together in ’60s radicalism’s intellectual descendants. You don’t have to spend too much time reading Paul Hawken and his intellectual cohorts to see that there remains a very strong streak in the green movement that sees environmentalism and anti-capitalism (or at least anti-corporatism) as fundamentally aligned. Alex Steffen of can write a generally superb essay about how consumer demands are changing the way smart businesses behave, and then veer off into left field with a line like this:

It’s hard to do work you can be proud of these days. We live in an ethically compromised global economy, and almost every aspect of our lives is compromised as a result.

For crying out loud.

Naturally, this is the opponent the anti-environmentalist right wants to engage. It’s easy. You can accuse them of wanting to achieve by green means that which they couldn’t achieve by voting for Ralph Nader or Jack Layton. You can pretend to adopt their values when you criticize the very concept of carbon offsets as modern-day papal indulgences (and every once in awhile the environmentalist left will indulge you right back). Instead of arguing about environmental policy, you get to refight the Cold War against communism, and we know how that turned out.

The truth is that heading off the worst of global warming and other ecological disasters, like defeating Nazi Germany, requires both kinds of effort. Both labour (substituting some of our own for certain conveniences, like abundant cheap water and electricity and delicious prepackaged food) and capital (developing less wasteful technologies and industrial processes, even if they cost more to begin with) need to be engaged.

But just as any fighting nation would be crazy to commit its military labour to a battle before the force arising from its capital capabilities had been applied to maximum effect, it’s crazy for genuine environmentalists to argue for lifestyle sacrifices as the only meaningful way to make the kind of difference we need to make.

Better to cut emissions than to offset

Ron Dembo of Zerofootprint posts engagingly at TreeHugger on, well, the value of trees:

The role of trees is essential to the health of the planet’s ecosystems, while their benefits so multifarious that we really cannot have enough of them. Everyone knows of the gifts of the trees in their neighbourhoods, whether it is the beauty and shade they offer, the protection from wind or flood, their flowers and fruit, their habitat for wildlife, their wood, their sap, or the playgrounds they provide for children.

Cities are beginning to realise that their trees have a quantifiable value. New York’s parks department, for example, has concluded that its street trees provided an annual benefit of about $122m, or $5.60 in benefits for every dollar spent, through their ability to combat pollution, reduce noise, prevent flash floods, add value real estate, and so on.

With one fifth of global emissions down to deforestation, we need to do everything we can to protect existing forests, while given the benefits of trees over and above their carbon sequestration, we need to plant as many as possible.

Everything about this is true and (re)forestation is extremely useful and important as both an environmental and an economic move on its own merits. But Dembo is ostensibly writing about using trees as carbon offsets, and doesn’t quite answer his own questions: “Why offset with trees when fossil fuels are to blame? … Shouldn’t we focus on renewable energy projects that can replace the use of fossil fuel?”

And the answer is that as far as reducing atmospheric carbon levels is concerned, we actually should focus on (1) using less energy, (2) getting energy from renewable sources, (3) reducing the carbon we emit from burning fossil fuels, and (4) trying to take carbon out of the atmosphere — in that order.

Once we’ve squeezed enough benefits out of one item on the list that we’re seeing diminishing returns, then we can move on to the next. Compare it to trying to put out a fire; the first thing you do is stop throwing gasoline on it, before you start dousing it with water.

Dembo also handwaves away the very significant practical problems we currently have with growing trees as carbon offsets, namely that it’s hard to be sure just how much carbon they’re fixing out of the atmosphere, hard to protect trees from being cut down or dying natural deaths later, and hard to be sure that any particular company is actually planting and managing the trees it says it is.

Again: reforestation is very, very good and worth pursuing, but getting it mixed up with the carbon-offset business means confusing both goals.

Emitting carbon is not, in fact, a sin

Further to my puzzlement over the repeated comparison of carbon offsets to papal indulgences, Gar Lipow of Grist Mill clarifies that the comparison only applies when the offsets are so poorly regulated that they’re really no good. It’s a bit technical, but the basic argument is that any offset you buy to satisfy a legal obligation — like a government-mandated emissions cap — had better be rock-solid, not some airy-fairy promise to plant a tree somewhere nobody will ever check.

Otherwise, Lipow’s argument goes, it really is just a permit to pollute: the result is more emissions than there would otherwise have been, and that’s as bad as someone making a plan that includes both a sinful act and a few coins sent the Pope’s way. It’s not what you’d call virtue.

That makes sense as far as it goes, but again, there’s a difference between sinning and emitting greenhouse gases. Sin, in any respectable religion, is only forgiven following authentic repentance, whereas if you really can compensate fully for emitting some carbon, there’s no foul. As long as you get the gases out of the air, how you feel about it and whether you’re planning to do it again have nothing to do with anything.

Weak trees, first in what’s bound to be a series

I’ve never understood opposition to carbon offsets on moral grounds — that “being green” is virtue that has to be earned and can’t be bought. The usual comparison is to papal indulgences, the practice of buying forgiveness for your sins whose rampant abuse in the Roman Catholic Church partly caused Martin Luther to leave it.

The difference is that God’s forgiveness wasn’t the Church’s to sell. If you can actually pay for a project that actually does remove carbon from the atmosphere, a carbon offset isn’t cheating. It might not be morally satisfying, in that it’s an option available to the rich that isn’t available to the poor, but, well, lots of things are available to the rich that aren’t available to the poor and we don’t as a rule say the rich can’t have them.

The point isn’t that being green is virtuous in itself, but that being grey-brown is harmful — and if you can structure your affairs so as to be carbon-neutral or carbon-negative, as far as I’m concerned you go right on ahead.

The trick, however, is that the people selling you your offsets have to have genuine offsets to sell. I’ve written here about a couple of schemes that strike me as unusually sketchy, but doubtless there are dozens or hundreds more. There’s no international verification standard, and usually a retail-level trafficker in offsets is promising to do something in a far-off land that you can’t go see yourself. Typically, he or she is promising to plant trees, on the theory that as they grow, they’ll “fix” carbon from the air in their physical structures.

This is fine as far as it goes, but Grist Mill has been doing some serious practicality checks on the subject and finds the actual practice of tree-planting to create carbon offsets seriously wanting:

The biggest one is timing. A carbon offset represents not just a specific amount of greenhouse gas reduction, but also a specific period in which the reduction takes place. One of the most basic principles of offset quality is that, other things being equal, you want to sponsor reductions that are taking place now, not at some far-off point in the future.

Unfortunately, trees grow rather slowly. And particularly when they’re small, they don’t sequester much carbon. The small print on tree-planting offsets typically indicate a 40-year maturity. If you buy a tree-based offset today, you’re sponsoring a reduction that won’t be complete until 2047, by which time we’ll either be living in hurricane-proof seaside bunkers in the Rockies or flying around in hydrogen-fueled jet cars.

Plus trees have a way of dying on you, of collapsing and rotting out or of burning, either of which puts that carbon right back in the atmosphere with the stuff you put out and were trying to offset.

We desperately need some standards for measuring and monitoring tree-based offsetting projects, and I wouldn’t take seriously anyone’s claim to have offset his or her own carbon emissions using such projects until we’ve got a licensing regime in place.