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How do carbon offsets work? Here’s what you should know before buying one.

For most of us, just living our daily lives means an almost constant increase in our carbon footprints, the amount of climate-polluting emissions we generate in the atmosphere. In fact, according to data published by Cool Effect, the average American produces nearly 17 tons of carbon dioxide equivalent (CO2e) (which incorporates carbon dioxide as well as other greenhouse gases, or GHGs. And considering the dire straits our planet is in, and the fact that our carbon footprint goal should be zero, those 17 tons are a lot. Chances are, you've heard of many ways to minimize your footprint, from choosing public transport over driving, to rethinking how and when you use your air conditioning, to buying carbon offsets. And while some of those things seem obvious and simple, figuring out something like how carbon offsets work to counteract your daily activities may be more complicated.

“Almost every activity we engage in produces greenhouse gas emissions,” Jonathan Smith, senior director of sourcing and sales at Bluesource, tells Mic. “On an individual level, your greenhouse emissions include [things like] your commute to work, your plastic takeout containers, [and] the water and electricity used in your apartment. As a country, our collective emissions include those from burning fossil fuels for electricity or transportation, timber harvesting, landfill emissions, and oil and gas extraction, to name a few.”

And while there certainly are things we can do to minimize the pollution we contribute to the atmosphere; but some of it is unavoidable — which is where carbon offsets come in. The phrase has taken a prominent place in the climate change lexicon, as more and more large corporations and organizations make their offset purchasing known. But you don’t have to be a big company to partake — individuals can buy offsets, too. Here’s what you need to know.

What are carbon offsets?

Carbon offsets are investments in projects that “find ways in which we can either reduce emissions or, equivalently, increase sequestration [or] storage of greenhouse gas emissions,” Peter Miller, director of the western region climate and clean energy program at the Natural Resources Defense Council, tells Mic, noting that their point is to literally offset emissions of carbon dioxide, methane and other greenhouse gases we create in our everyday lives. “A classic example is...preventing trees from being cut down: Trees sequester carbon on their wood; and the more trees we have, the faster they grow, the longer they grow, the more carbon they’re going to sequester from the atmosphere and reduce the impact of climate change.”

But not every tree planted is considered an offset — it’s a bit more complicated than that. In the tree example — like this forestry project from Bluesource, in which a landowner committed to preserving the trees — the actual offset is “the difference between the GHGs associated with the ‘baseline scenario’ (timber harvesting) and the ‘project scenario’ (sustainable harvesting),” Smith says, explaining that it’s calculated in metric tons of carbon dioxide equivalent (CO2e), which incorporates all global warming-contributing GHGs. “One offset credit equals one ton of CO2e. Basically, one offset credit is the equivalent of not emitting one ton of CO2e.”

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What actually happens when you purchase a carbon offset?

Carbon offsets are created through a wide range of projects, focusing on things like forestry, clean cookstove creation, renewable energy, wildlife conservation, and more. Depending on who you buy your offset from, you may be able to direct your purchase to a specific project or type of project. As Miller explains, the projects can be developed and managed by municipalities, private companies (like Bluesource), or non-profits (like Cool Effect). So, if a company wants to develop a tree-planting project, they’ll submit and list it with a third-party offset registry (like the American Carbon Registry, Verra, and the Climate Action Reserve, the latter of which counts Miller as a board member), then plant the trees following rules set forth by the registry. Once the project is done, they add up and register the achieved emissions reductions. “Each ton of emissions reduced is given a unique serial number, so it can’t be sold twice,” Miller says.

So, for example, if you want to offset a flight you’re taking, you can do so via the airline itself or another offset vendor; and in either case, “they share a portion of the profit with the project owner [like a landowner],” Smith says. “The income you provide to the project helps pay back the clean investment and provides a financial incentive for other project owners to choose more sustainable options.”

How do you buy them?

You can google “carbon offsets” and find plenty of sites offering to sell them to you; but it’s important to be discerning and make sure you go with a legitimate vendor. “What you want to see in a good program is a specified set of activities that can be demonstrated to reduce emissions, and that have been verified by independent third parties,” Miller says. “You want to avoid someone who says, ‘Hey, I just came up with this project and I say it reduces emissions, so you should believe me.’”

Those independent third parties include organizations like the aforementioned Climate Action Reserve, American Carbon Registry and Verra, among others. “Those bodies are the offset equivalents to a regulatory body like Fair Trade Certified,” Smith says. “They use approved offset protocols, which are the documented steps required to create the credits. These protocols have been tested and proven over time.” Smith says almost 100% of the offsets created in North America are done so using one of these recognized registry programs; and when buying offsets, you should be able to verify their registration. “If a retailer is unwilling to provide a link to the project’s profile on the registry, that’s a red flag,” he says.

Beyond third-party verification, Marisa de Belloy, CEO of Cool Effect, tells Mic it’s important to look for “additionality” with any offsets, which means those projects or actions wouldn’t happen anyway, without the offset funding. “Look for confirmation that it is additional by asking for due diligence documents and transparency in pricing,” she says. “Understand where your money is going when you purchase the offset and how much is going to any broker or middleman.”

Once you’ve found a legitimate vendor, you can purchase your offset online — beyond selecting specific projects or types of projects, you can select the amount (in tons) you’d like to buy. Many sites offer carbon footprint calculators and other resources that help you figure out your overall annual carbon footprint or your footprint from specific behaviors and actions (like your home’s electric bill). For example, as de Belloy notes, Cool Effect’s travel offset tool will tell you a round trip with a seven-to-nine hour flight each way generates about 1.32 tons of emissions, which will cost $11.05 to offset through their site. Terrapass, meanwhile, includes an offer to purchase monthly offset subscriptions for $4.99 per 1,000 pounds. And supporting specific projects through Cool Effect currently ranges in price from $3.30 per ton to $13.18 per ton.

Ultimately, there are plenty of ways to go about it, but if you want to keep it simple, “the average American produces about 17 tons of carbon emissions per year, so you could do a one-time purchase and offset an entire year of emissions based on your lifestyle, or you could offset just one or two tons to cover a recent trip,” de Belloy says. If you’re looking to offset a flight, check first with the airline to see if they offer an option when you buy your ticket, as many do. (And note that starting in 2020, many airlines will be required to offset international flights whether you buy one or not.)

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Should everyone be buying offsets?

In general, “I stress that an individual or business should do everything in their power to reduce their footprint — such as switching to renewable energy, eating less red meat [and] limiting air travel — and use offsets as the last piece to eliminate remaining emissions,” de Belloy says.

Travel — particularly flying, which generates a lot of carbon — is often called out as an activity that should be offset; but the reality is, even if you live a pretty local life, you’re still emitting greenhouse gases. “If you are a human alive on the planet today, you are having an impact on the climate,” Miller says. “Your consumption is resulting in greenhouse gas emissions, and those emissions threaten people’s lives and livelihoods, our health, and much more — so it’s worth investing in offsets as a way to reduce those impacts. ...It doesn’t cost that much to reduce emissions through offsets, and anyone who’s paying attention to the facts can see that those impacts [will be] catastrophic unless we do something about it.”

Do they really make a difference?

Offsets aren’t some magic environmental cure that completely cancel out climate change or make it okay for you to pollute away in your daily life. “It doesn’t make sense to live a lifestyle that just simply doesn’t care about emissions, is inefficient, drives a dirty car, and then just hopes to offset later,” Miller says, emphasizing that it’s still crucial to reduce emissions whenever and wherever you can. That said, he notes, “well-implemented and effectively managed offsets can absolutely have a huge impact [and] can do what they say they are doing, which is reduce emissions or increase sequestration,” Miller says.

Plus, a bonus: “Offset projects almost always...can provide important co-benefits,” Miller says. “A forest project can help protect water supplies or protect the local ecosystem, [and] a cookstove project can reduce indoor air pollution in developing countries.”

And, Smith notes, offsets provide a financial incentive to small, local project owners to “choose sustainable and environmentally friendly options that often would [otherwise] bring in less revenue without offsets.” The bottom line? “Carbon offsets are important and effective,” he says. “And they’re just one option available to tackle greenhouse gas emissions; they’re one tool in a toolbox to fight the climate crisis. Offsets bring together the environmental outcomes that we need as a society with the business environment that allows the investment in green technologies and applications. ...Carbon offsets do create change.”