Criteria for Carbon Offsets
Carbon offsets can feel overwhelming, whether you’ve been around them for years or you are just starting out. There are numerous projects available with many nuances between them, and some voluntary corporate buyers don’t know where to start. This series is intended to provide a framework for thinking about 4 different criteria among voluntary offsets.
4. Geography and Fit
When available, some buyers choose to support projects that are close to their operations or locations, while others choose to purchase offsets that were generated in the same industrial sector. The City of Austin, for example, prefers to source local projects for its offset commitments, and if those cannot be found, geographical scope is expanded to the state and ultimately the country. The same rules apply to most of the offsets that are used to fulfill California Environmental Quality Act (CEQA) compliance. This CEQA regulation requires real estate developers to offset the emissions associated with new developments located in California and typically involve geographic constraints, but the requirements for these offsets vary by jurisdiction.
With these preferences in mind, project developers attempt to meet the market demand for offsets by developing projects from a variety of technology types at different price points and in various locations. With the growing number of companies that have ascribed to net-zero goals, the new demand from airlines regulated by the International Civil Aviation Organization’s Carbon Offsetting and Reduction Scheme for International Aviation and colleges and universities striving to meet their Presidential Climate Action Commitments and other internal goals, offset project demand in North America is poised for significant growth—which means even more market evolution. While the landscape of carbon offsets gets more crowded, developing preferences and goals in each of these four areas will help corporate buyers sift through a plethora of potential projects.