What makes a carbon offset high-quality?

The carbon markets have seen pretty monumental growth over the last few years, as both businesses and individuals look for ways to help to mitigate our climate crisis. However, we also see a wealth of skepticism about whether certain offset projects really 'do what they say on the tin'.

Whilst there has certainly been some sensationalism in the press relating to 'junk offsets', we must say that, in many cases, the criticisms are warranted.

We are unable to dissect the entire world of offsets in one article alone, but you will find below a list of some of the key quality criteria that must be assessed to ensure that an offset project really does what it promises.

Additionality

Simple definition:

Could this project have happened anyway, without the carbon offset funding?

One of the primary criteria for assessing offsets is additionality. This concept assesses whether reduction or removal of emissions would have occurred without the credit funding. In other words, the project's impact must go above and beyond what would have happened under business-as-usual scenarios.

Example of additionality issue:

A large-scale wind farm in parts of the western world where there already exists enough financial incentive for the wind project to exist anyway. This would not be additional.

Leakage

Simple definition:

Are there emissions displaced elsewhere because of the project?

Leakage refers to the safeguards put on the project to de-risk the emissions reduction/removal being lost through displacement into emissions downstream or upstream. Essentially, it ensures that a project doesn't inadvertently cause an increase in carbon emissions in another area, while reducing them in the project area.

Example of leakage issue:

A project that claims to reduce emissions through protecting a specific area of forest, but doesn't have legitimate safeguards to ensure that the very protection of the area doesn't just cause deforestation 'down the road'.

Permanence

Simple definition:

How long does the emission reduction/removal lasts for on the project?

Permanence measures the duration for which the emission reduction or removal lasts. A project with high permanence will have a long-lasting carbon reduction/removal, providing a sustained benefit to the environment.

Example of a permanence issue:

A reforestation project that doesn't have an adequate 'buffer pool' of carbon offsets, in the case that there is a forest fire.

Net Zero Compatibility

Simple definition:

Does this project really support our energy transition?

Net Zero compatibility assesses whether the project type facilitates a long-term transition to low, zero, or negative-emissions technologies.

Example of a Net Zero compatibility issue:

A project that delivers clean cooking technologies, such as household biodigesters. This drives a carbon reduction yes, but a solar-powered cooking technology would be more compatible with our energy transition.

Developer Experience

Simple definition:

Has the project developer delivered quality projects before, successfully?

The credibility and experience of the carbon project developer play a significant role in the project's success. This includes their level of engagement and commitment to quality, as well as a demonstrated track record in previous projects.

Example of a developer experience issue:

A standalone carbon project developer who has no experience or higher-level guidance on quality criteria and accreditation.

Governance & Audit

Simple definition:

It's not enough to just be accredited. Project-level governance and independent audit is mandatory for quality projects.

Good governance in a carbon offset project entails transparency, annual third-party auditing, and adherence to a wealth of environmental, social and carbon-based safeguards.

Example of a governance & audit issue:

A project that sits on an unknown accreditation with little requirement for independent auditing.

Social & Environmental Safeguards

Simple definition:

Is the project taking into account the negative potential impacts to both biodiversity and wellbeing of local communities?

A quality offset project always includes safeguards that prevent negative social & environmental impacts and has very close relationships with local stakeholders.

Example of a social & environmental safeguards issue:

A new reforestation project that plants invasive species and doesn't directly involve the rural communities who live near the project and use the land.

Double Counting

Simple definition:

Is the carbon reduction/removal of the project counted and claimed twice?

Double counting is avoided in two key ways, one that is simple and the other slightly more complex.

1. Avoiding double counting between two independent parties is resolved by the existence of a credible accreditor and associated registry, which ensures that an offset is only retired once. You can see examples of retirement certificates on our transparency page.

2. Avoiding double counting between a nation and an independent party. Here, you need to select an offset that has been verified as sitting in a country that has a corresponding adjustment in place under Article 6 of the Paris Agreement. This is a key current focus of the carbon markets, as the authorisation can only take place at national level. You can read a good example here from Rwanda & Gold Standard.