Accountability in the consumer carbon offset market: just what are you paying for?

carbon offset accounting Another sign of the gradual maturation of the consumer carbon offset market: the New York Times recently filed a piece that moves beyond the simple who, what and why of the industry (although the article still has plenty of that), and instead focuses more intently on how to differentiate the various organizations in this space. Like most first-look articles, this one makes some fairly wince-inducing statements, but I give the Times credit for at least raising the issue of accountability.

TerraPass has from the beginning regarded accountability as a core feature of the product we offer. Sadly, the Times doesn’t view plumping for TerraPass as its mission in life, and the article fails to connect some important dots. I, on the other hand, do regard plumping for TerraPass as my mission in life, so allow me to connect the dots for you.

Here are the money paragraphs:

“The challenge for consumers is that there is no uniformly accepted standard for what constitutes a valid reduction in global warming pollution,” said Daniel Lashof, science director of the climate center of the Natural Resources Defense Council. The exceptions, he added, are green tags carrying the Green-e certification, a seal of approval issued by the Center for Resource Solutions, a nonprofit group based in San Francisco that verifies that clean-power companies sell the amount of power they say they do.

That label, however, is limited to green tags, and doesn’t apply to companies that sell a mix of projects. Those involving reforestation can be especially difficult to verify.

“There’s not a whole lot of great tracking for building forests in Costa Rica,” said Brendan Bell, associate Washington representative of the Sierra Club’s global warming and energy issues program. “How do you know the same acre isn’t being sold to a bunch of people?”

Some marketers are trying to improve accountability. The Conservation Fund sends certificates to supporters, telling them when and where their trees were planted. TerraPass has transactions verified by the Center for Resource Solutions. And the Climate Neutral Network, an independent nonprofit group in Portland, Ore., has developed a “Climate Cool” certification for carbon offset products, though it has not been widely adopted. The Center for Resource Solutions is also developing an offset certification similar to Green-e that it hopes to introduce this summer.

Notice that the Center for Resource Solutions pops up in three places. First, the CRS’s Green-e certification is cited as the only uniformly accepted standard for what constitutes a valid reduction in global warming pollution.

Next, the CRS appears as the third-party auditor that verifies TerraPass’ carbon transactions. You can see CRS’s spiffy Green-e logo on the content label that accompanies every TerraPass we send out. What the article fails to make clear is that we are the only organization in our industry that is audited in this way.

Finally, the article mentions that CRS is developing an offset certification similar to its industry-standard Green-e certification. As perhaps might now be clear, TerraPass is one of the prototype customers for the new certification that CRS is developing, and we are proud of our role in helping to push forward industry standards for accountability, which we believe to be crucial to the long-term health of the consumer carbon offset market.

I wouldn’t expect the Times to draw out these particular points. But in skipping some of the finer details, the article does leave a few unfortunate misimpressions. For example, are we really meant to see any sort of equivalence between the independent third-party audit that TerraPass voluntarily submits to, and the certificates that other organizations send out to their sponsors? Certificates aren’t a form of accountability any more than our window decals are.

And toward the end the article baldly states, “Accountability may be especially important in the for-profit arena.” There’s enough wiggle room in that sentence that perhaps some defensible interpretation can be made. But taken at face value, the sentiment is deeply wrong. Accountability is important, period, full stop. The tax status of the organization selling the offsets has no bearing on the quality of the product. Whomever you’re buying from, demand accountability.

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  1. Rebecca Carter - June 26, 2006

    I’m trying to understand more about carbon neutral. More specifically, these organizations that allow you to pay them to plant trees to offset your carbon usage. Are seedlings planted and calculated to absorb the carbon over the lifetime of the trees, or is the calculation more based on absorption of the CO2 more quickly?

  2. Tom - June 26, 2006

    Rebecca:

    Almost all forestry organizations use a futures model. When you pay for a ton of carbon, you are paying for the assumption that that ton will be absorbed in the lifetime of the tree, typically 40 years or more (at which point, it should be cut down and replanted).

    The managed forest aspect of carbon sequestration introduces even more uncertainty, with some studies showing no net sequestration due to soil management practices.

    With only a few years to really change our climate situation, this is not a palatable strategy for us, and why we focus on clean energy development.

  3. Rebecca Carter - June 26, 2006

    Great info. Thanks so much. I’m involved with a project right now that is working on being carbon neutral via seedlings, and was trying to get some outside info. That was very helpful. Thanks so much. I’ll be checking back here often.

  4. Peter Maynard - June 26, 2006

    Very solid comment regarding accountability. Admittedly when reading the NYT article, their take did produce a head scratch. I think accountability is highly critical. Right now this is a very emerging concept, and if public perception gets shaped that people are buying the equivalent of bad Florida real estate, it could lead to negative press, government investigation etc.

    The for-profit versus not-for-profit status could be a source of concern and it bears watching public perception going forward. One person interviewed got hung up on it. You have to overcome the assessment that for-profit is on a lower moral plane than profit.

    Some unsolicited advice: Document the results. All of them. People will leverage Terapass if it shows results. Period. Not just intermediate outcomes, real outcomes. This is tricky because at the end of the day, it is a reduction in CO2 emissions and improved quality of life. Set that at the target and go for it. Taking a look at what you have for results, show more graphs, pictures, metrics showing the improved air quality not just the projects –whatever it takes that working through you all generates the results people crave and need.

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