What are the practical uses of carbon offsetting to achieve Net Zero at asset level? And is it a legitimate tool to tackle climate change?
After a few dents to its reputation, carbon offsetting has emerged as a viable and necessary part of the Net Zero puzzle, according to the United Nations’ science based targets. Vicky Cotton, head of ESG at Workman, explores how the property sector can maximise its use within asset-level carbon reduction strategies as part of sustainable development.
On the road to Net Zero buildings, there’s a clear hierarchy of carbon reduction steps. It begins with reducing carbon within construction. Next is reducing operational energy use. This is followed by increasing renewable energy supplies onsite, through solar PV, for instance. Lastly, there’s a focus on increasing biodiversity and investigating nature-based solutions. To ignore this carbon-removal methodology is where perceptions of cheating or greenwashing can creep in. Instead, divert straight to offsetting carbon emissions to meet the Net Zero target.
However, once a Net Zero strategy is established, the UK Green Building Council says any remaining carbon emissions can legitimately be offset to compensate for residual emissions: “As an interim measure towards Net Zero 2050, carbon offsetting should be seen as the last step in a proactive approach to; reduce construction carbon, reduce operational energy and increase renewable energy supplies.”
Window of opportunity for major interventions is ever decreasing
Asset managers should focus on how carbon offsetting aligns within their Net Zero Asset Plan and sustainability objectives. Determine its role in carbon reduction and plan it into your Net Zero strategy.
Many organisations have set Net Zero targets between 2030 and 2040 to combat global warming. The window for major carbon footprint interventions is rapidly closing. Carbon offset strategies can be used effectively as part of a Net Zero Asset Plan to fill the gap.
For many, this is where the complexity of the carbon reduction solution reveals itself. It’s not just business-as-usual. For example, if a gas boiler is due for replacement with an efficient low-carbon alternative in three years, offsetting its carbon emissions for the interim period is a positive solution. Firstly, carbon credits would need to be assessed and calculated for the boiler’s remaining lifespan.
Each carbon credit, which equals one metric tonne of CO2 reduced, avoided, or removed, can offset one tonne of CO2 or equivalent gases. Once a credit is used, it becomes an offset. It is moved to a publicly available registry for retired offset credits, and is no longer tradable. The carbon offset market could provide a tenth of the effort needed to cut greenhouse gas (GHG) emissions in line with staying within 1.5C of global heating, according to The Taskforce on Scaling Voluntary Carbon Markets.
Are carbon offsetting schemes effective?
If immediate action isn’t taken, tree planting for offsetting remains a positive climate action step, promoting biodiversity. Moreover, according to the UKGBC, it’s better if these projects are near the building and local communities. If asset managers simultaneously take primary steps in the hierarchy, like introducing solar PV panels, they make progress toward carbon reduction and Net Zero targets.
To ensure effective carbon offsetting, invest in schemes that create additionality, meaning they reduce CO2 that wouldn’t exist otherwise. For instance, protecting existing forests in developing countries from deforestation or investing in land for reforestation are highly effective offsetting projects.
Additionality can also come from switching to renewable energy suppliers like Good Energy, Green Energy or Ecotricity, who generate their renewable energy. They build wind, solar and green gas facilities.
The bottom line: offsetting must work in tandem
The bottom line is that carbon offsetting must work in tandem with an ambitious internal carbon reduction strategy. The priority should always be reducing greenhouse gas emissions and carbon footprint while enhancing energy efficiency. Offset should be a last resort, but not every business can quickly reach net zero and achieve carbon neutrality.
Some also believe that offsetting can be a catalyst for further, wider carbon reduction action.
As the UKGBC states in its Renewable Energy Procurement & Carbon Offsetting report: “Carbon offsetting presents an opportunity, beyond emission reductions, to develop a broader value proposition that is aligned to long-term business strategies and supports the UK and global transmission to Net Zero.”