Analysis: Staying True to the Paris Agreement Could Hobble Booming Carbon Offset Market
Buying CO2 reductions from a project in the global south in addition to avoiding emissions from their own operations (or instead of avoiding them) is the new normal for many companies who are pursuing net-zero targets or want to sell “carbon neutral” products. The recent boom and projected growth of the carbon offset market is so considerable that some predict an undersupply of carbon credits in the near future. The potential of a “100 billion dollar” market has caught the attention of famous business people and bankers such as former governor of the Bank of England Mark Carney, who with his Taskforce on Scaling Voluntary Carbon Markets (TSVCM) wants to shape the global rules of carbon offsetting.
But while “compensating” emissions on the voluntary market becomes more and more mainstream, there is also recurrent and strong criticism of the practice, and with the emission accounting rules of the Paris Agreement taking hold across the globe, the entire market could lose its footing.
Photo by Steve Taylor.