Is “Paying to Pollute” really a bad thing?

August 5, 2021

If you’ve been around environmental markets for a while, or even if you’ve just been reading some articles on the subject lately, you may have seen companies that have purchased carbon offsets criticized for “paying to pollute.”  The implication of that phrase is that the company has simply bought its way out of bad behavior, and the image evoked is one of spending a paltry sum to make up for an action with a much higher cost to society, remorseless in so doing and lacking in true motivation to change one’s behavior. Yikes.

So, how does that image reconcile with the fact that it is the world’s most progressive and leading  companies that are usually the ones choosing to undertake these offsetting efforts?  Are these bad actors in disguise?  Let’s remember that this is a matter of choice.  To be clear, for the majority of companies there is no obligation whatsoever to reduce or pay for their greenhouse gas emissions in any form, or to accept any responsibility.  That means that there are hundreds of thousands of companies that are polluting without paying a cent for it.  Companies that offset their emissions and take other measures to fight against climate change choose to incur an expense for their emissions – they take self-imposed responsibility.  Unfortunately, they take some flak for it as well under the banner of not doing enough. 

This voluntary action (and why we call this a voluntary market) is because no one is forcing a company to pay to pollute – the planet is simply fortunate to have some leaders take on that responsibility anyway.  And if you think about it, one of the best ways to reduce pollution is to have companies feel financial pain for the pollution they cause.  But let’s take this to ground level and be honest with ourselves, admitting that it is often we, the individual consumers, that make the decisions that result in emissions.  Even if you’re doing what you can to live sustainably, you will likely make a decision every single day that causes a company’s emissions to go up.  That flight, that road trip, that backyard BBQ, that commute to work on a rainy day, that computer running on your WFH day – these are our choices that are driving up emissions at oil refineries, agricultural operations and power plants.  But what if we too start allowing ourselves to feel the pain of such choices?  What if we take on the responsibility of paying for our pollution?  Will we then think twice about those decisions?  Will emissions go down?  I imagine so.

Actually, I don’t have to imagine, because it’s already working.  An Ecosystem Marketplace study found that companies who offset their emissions were also more likely to take other measures to reduce their emissions directly.  In our 20 years of experience, we’ve found similar shifts in corporate cultures among our clients, starting with one emission reduction project, seeing its success and moving toward holistic carbon reduction strategies. 

But let’s move from the ground level up to 10,000 feet.  Climate policy.  The tool(s) that will hopefully drive society-wide emissions down to a level that can stave off the climate crisis.  To be clear, finding agreement on climate policy is as difficult as any other political endeavor with widely diverging opinions on the best approach.  Nevertheless, whether you think the best policy is a carbon tax, cap and trade, cap and dividend, cap and invest, etc. – all of these are rooted in the simple truth that pricing carbon will reduce emissions.  Pay to pollute.  Feel the pain.  Reduce pollution.

This article is contributed by

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