In The Wild West Of Carbon Offsets, Who Plays The Sheriff?

The apparent endorsement of carbon offsets by a leading standards watchdog was welcomed with jubilation by those who sell them. Everyone else is steaming mad about it. Here's why.

This is Edition #5 of The Climate Laundry. Please subscribe if you’d like to read more, and please consider becoming a paid subscriber if you’re able to support my work.

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The market for carbon offsets is a mess. It is riven with bad incentives, as eager providers sell inflated promises to corporations hungry to greenwash their image. In such a sector, trust is hard to find—and it just got even harder.

Last week, the Science Based Targets initiative (SBTi), a widely respected organisation that sets standards for how firms should structure their climate strategy, made waves when it indicated it would soften its stance on offsets, allowing companies to purchase them to cover some of their “indirect”, or scope 3, emissions. Now, insiders have revealed to me that the SBTi’s shift was the result of intense lobbying by vested interests.

The initiative’s announcement was significant because its most recognised standard states that, in order to be recognised as net zero compliant, companies must cut their emissions 90-95% before 2050—without the use of offsets. Loosening the rules around offsets would represent a sea-change for the organisation, and for the status and use of offsets more broadly.

Speaking on condition of anonymity, a researcher and member of the SBTi’s technical advisory committee told me that the move was the result of a “coordinated campaign” by an alliance of corporations and firms that sell offsets, “to force the [initiative’s] board to allow more flexibility on scope 3 and use of [carbon] credits”. In their view, corporate interests were “trying to water down climate targets in order to scale the carbon market. It's almost as if they think that setting targets is an end in itself, as if how we achieve those targets doesn’t matter.”