Carbon Offsets: Why they matter and how they’re used

In previous posts, we’ve touched on topics like carbon neutrality and how capturing landfill gases can both generate energy and create carbon offsets–but just what are carbon offsets and how do they work?

For many, carbon offsets are considered a key component in the fight against climate change. While Earth has its own mechanisms for removing CO2 from the atmosphere, the system has become overloaded causing atmospheric concentrations of CO2 to rise[1]. Now, we need to find a solution to bring that system back into balance and remove the excess CO2 that, along with other greenhouse gases, is contributing to the overall warming of our planet[2].

Energy efficiency improvements and utilization of lower-emissions fuels are key parts of the solution, but some emissions are simply too difficult, too costly, or impossible to completely remove. This is especially true in certain hard-to-decarbonize industries like transportation. This is where offsets come into the picture as an important piece of the puzzle—enabling companies to balance or “offset” those remaining emissions on their path to carbon neutrality or “net-zero” transitions.

A carbon offset or “credit” represents the reduction or removal of one metric ton of CO2 equivalent from the atmosphere.  There are a range of approaches to either reduce or remove CO2, from capturing emissions to planting forests, but the core goal of an offset project is to either prevent greenhouse gas emissions from entering the atmosphere or remove existing gases from the atmosphere.

So, how are these offsets used? In the simplest terms, offsets can be used to counteract emissions in a one-to-one fashion, whereby an offset from a reputable project can be utilized to balance out an equivalent amount of emissions. For example, a company that generates 100 metric tons of CO2 equivalent emissions could purchase 100 carbon offsets to balance out those emissions. A large portion of this sort of carbon offsetting currently is done on a voluntary basis to support corporate net-zero goals, meet customer expectations or fulfill commitments to investors and other stakeholders.

Look for our next offsets-related post in December when we’ll dig deeper into the different types of projects being utilized to generate offsets. In the meantime, you can read more about net-zero here:

The Net-Zero Standard – Science Based Targets

Net Zero Coalition | United Nations

[1] Global Monitoring Laboratory – Carbon Cycle Greenhouse Gases (

[2] Climate Change: Global Temperature | NOAA

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