Carbon Offsets

Carbon Offsets are reductions in GHG emissions or sequestration of carbon that compensates for emissions elsewhere. A carbon offset credit is transferable instrument certified by governments or independent bodies to represent reduction of emissions1.

  • Due to poor offset quality, many of the corporate plans for net-zero are fundamentally flawed2.

Potential Projects

  • Renewable energy development that replaces emitting sources
  • Afforestation / Reforestation
    • Avoided Conversion
    • Improved Forest Management
    • Price of natural offset products has tripled in past six months as of Jan 20223.
  • Capture and destruction of high-potency GHGs
    • Methane Destruction
    • Industrial gases
  • Energy efficiency4


  • Carbon Trade Watch is a group opposed to offsets and markets, for social as well as environmental reasons. Appears to not have published anything in ~6 years.
  • Carbon Market Watch european group that focuses on carbon pricing and policy.
  • Berkeley Carbon Trading Project research and advocacy group focused on trading and offsets. Takes a jaundiced view of the actual emissions reductions claimed by most offsets.


  • Mark Carney and Bill Winters5
  • Barbara Haya studies carbon offsets at UC Berkley6
    • Research
  • Mark Trexler authored the first carbon-offset methodology6
    • Research

TODO Carbon Offset Guide

TODO need to understand aggregation

Offset Quality

  • A major issue within carbon offsets is low offset quality or quality standards. For example, with aforrestation, companies may claim offsets for forrests that were never threatened. Bloomberg points to the Nature Conservancy as an offender in this space6. Verifiers and registries do not account for the feasability that “protected” lands would be harvested6.
  • Berkeley’s Carbon Trading project is skeptical of the offsets in California’s afforestation programs7. “Rather than improve forest management to store additional carbon, California’s forest offsets program creates incentives to generate offset credits that do not reflect real climate benefits.”

Surrender / Deletion

  • Some entities purchase carbon credits from capped marketplaces and voluntarily remove them from the marketplace. In effect, this lowers the cap by not allowing them to be used by an emitter. One example in this space is Climate Vault.

Standard Setters

There are two broad types of programs: compliance from governmental certifications and voluntary from NGO certifications1. Standards for the verifiers flow form ISO 14065:2020: “General principles and requirements for bodies validating and verifying environmental information”.

Offset Raters

  • Sylvera rates carbon offsets, particularly focused on forestation projects3.
  • BeZero Carbon provides data and analytics for rating offsets within voluntary carbon market3.

Project Managers

Carbon Markets

Taskforce for Scaling Voluntary Markets

The Taskforce on Scaling Voluntary Carbon Markets (TSVCM) is a private sector-led initiative working to scale an effective and efficient voluntary carbon market to help meet the goals of the Paris Agreement. The Taskforce was initiated by Mark Carney, UN Special Envoy for Climate Action and Finance; is chaired by Bill Winters.

Double Counting

Contentious idea that credits could credits could be claimed by both the buying and selling country.

COP26 Carbon Market Agreements

  • Established rules for Article 6 of the Paris Climate Agreement which govern international cooperation on emission reduction. One key cooperative method is carbon markets. Article 6 is voluntary, not regulatory.

Source for following points8:

  • Agreed to “carryover” of credits generated under Kyoto since 2013
  • “Share of proceeds” from carbon offset selling is only mandatory under some parts of Article 6
  • Restricted “double counting”
    • “The proposal makes a subtle shift to the moment when “corresponding adjustments” have to be applied, from the point of use to the point of authorisation by a host country”
  • Excludes credits from REDD+
  • disputes around carbon-offsetting projects will be subject to an independent grievance process
  • No numerical limits placed on offsets
  • Article 6.4 creation of a new international carbon market for the trade of emissions cuts, created by the public or private sector anywhere in the world
  • Article 6.2 allows for “averaging” over time, which opens the door to double counting
  • On international private buyers: “The buyer would “own” the emissions reduction and could claim it against its own emissions total – for example, towards a corporate net-zero target – while the host country would have to apply a corresponding adjustment to its own inventory, to reflect the sale.”
  • An Article 6.4 “supervisory body” will start work in 2022 at two meetings, where it will begin to draw up methodologies and administrative requirements for the market.

ITMO - Internationally traded mitigation outcomes


Broekhoff, D., Gillenwater, M., Colbert-Sangree, T. & Cage, P. Securing Climate Benefit: A Guide to Using Carbon Offsets. 60 (2019).
Ballard, E. Tech Startups Race to Rate Carbon Offsets. Wall street journal (2022).
Shankleman, J. & Rathi, A. Wall Street’s Favorite Climate Solution Is Mired in Disagreements. (2021).
Badgley, G. et al. Systematic over-crediting in California’s forest carbon offsets program. Global change biology 28, 1433–1445 (2022).
Evans, S. et al. COP26: Key outcomes agreed at the UN climate talks in Glasgow. Carbon brief at (2021).

Bamboo Certified Carbon Offsets

Bamboo Non-Certified Carbon Offsets

Some projects choose to eschew standard setters altogether. Arguably because of cost, but more likely they are selling to buyers who care more about the story over the quality:

  • Bamboo Village Uganda plants bamboo in Uganda village and sells square meters of plantation.
  • Planboo plants plantations in Sri Lanka or North East India.