February 28, 2024


What Is Carbon Offsetting for Businesses?

What Is Carbon Offsetting for Businesses?

What is a carbon offset?

Carbon offsets are compensation for greenhouse gases that are stored in the atmosphere for emissions that happened elsewhere. Offsets, just like emissions, are measured in tonnes of carbon dioxide equivalent (tCO2e). 

Some say carbon offsets are an excuse for businesses to produce more emissions or to elude the eradication of fossil fuels, but that's not the truth. Until we are able to replace all energy sources and other materials with alternatives, we have to offset the emissions that have already been made or capture them and store them in carbon sinks with direct air capture (DAC). Carbon offsetting projects bring social, health, and environmental benefits, and employment opportunities to international and local communities. Emissions reductions and offsetting projects are both important parts of the strategy according to The Paris Agreement and the UN International Panel on Climate Change (IPCC).

If you want to learn more about adding offsets to your net zero strategy and why it's important, then this is for you. Here we'll answer some of the most common questions about what carbon offsets actually include and how to use them best in your strategy. 

How much do carbon offsets cost?

Most offset credits cost about 8 pounds or 12 USD per tonne of carbon dioxide emissions. The Guardian reports on a lower scale, "At this price, a typical British family would pay around £45 to neutralise a year's worth of gas and electricity use, while a return flight from London to San Francisco would clock in at around £20 per ticket." They also report that some carbon-neutral companies sell specific products that come with carbon offsets included in the price like Land Rovers because of their production plus their first 45,000 miles of use.

Sometimes the prices differ in carbon offsetting projects regarding taking a step further to improve the quality of life for communities with clean water projects and more, so carbon credits could vary or the project may cost a bit more in credits than others. The idea is that the pricier ones should have an added value for a more successful project.

When you buy carbon credits in Net0's system, you're able to choose from over 140 offsetting project options, 40 of which are available in one click without any approvals. We offer a wide range of options from $2 per tonne for deforestation protection in Colombia to $400 per tonne for BioMass research in San Francisco. 

Related content

If you would like to learn more about carbon reductions and offsetting, please refer to these articles in our academy of free resources:

• Article: Carbon Offsetting for Events
• Article: Carbon Neutrality for Sports: Take Climate Action Now
• Article: Carbon Credits: Everything You Need to Know

Who needs a carbon tax and why?

A carbon tax is a way for emitters to pay for emitting CO2, but then the government makes money from the taxes unless they are put toward offsetting. Moreover, when businesses and individuals offset themselves instead of having a tax, they have control over choosing the projects that are more important to them or the ones most important to society at the moment, not unknown projects left in the government's hands. Different countries are seeing different rates of CO2 emissions drop since imposing a tax but that isn't all there is to it. Sweden is excelling in wind power in a way that other countries are not for instance. Their decline in fossil fuels is not just due to an imposed tax.

Rather than the need for a carbon tax as there are already laws in motion to get to net zero, using carbon offsetting software as part of the strategy to reduce and manage your own projects keeps businesses in control of their emissions in lieu of having massive government involvement, complicated tax structures, having to hire expensive accountants so taxes are done properly, and anything that comes along with branching outside of the business to control its procedures. Meeting emissions targets and making it mandatory to report through carbon credit systems in regional markets can be done with offsetting software instead of by imposing a tax, to make sure companies are staying within their quotas.

Is tree planting a reliable carbon offset?

Tree planting is a fantastic way to improve the atmosphere but their carbon offsets can be tricky although most commonly purchased. Trees do reduce a significant amount of carbon emissions in the atmosphere but there are things to consider when reducing your carbon emissions from the get-go vs. offsetting. Older trees absorb more carbon from the environment than new ones. But as trees grow they absorb more making it a valid project, however, if the forest is cut down in a few years it just negates what was done so projects like this from offsetting companies need to be viewed more precisely to ensure that the promised achievement will actually be completed in the long-term. However, while trees are growing, global warming will continue as long as people are still burning fossil fuels like coal, gas, and oil. It would take decades for trees to absorb all of the carbon that is put into the atmosphere. 

The Climate Connection reports, "...the typical American produces 14.95 tonnes of CO2 every year. A mature tree captures on average about 22 kilograms of CO2 per year through photosynthesis. Every American would need to plant an incredible 618 seedlings every year to offset their carbon footprint. This is both unfeasible and unrealistic." Although we love trees, the whole world cannot be a forest so that is why we have provided a more diverse set of projects for you on our platform that contributes to different aspects of solving the emissions problem.

Since Net0 offers so many offsetting projects in the areas of renewable energy, mineralization, biochar, forestry, oceans, bio-oil, landfill methane capture, REDD+, livestock, industrial process emissions, cookstoves, boreholes, and soils, you can choose from any of the options that work for you to reduce emissions much faster all in one click.

Photo by Aiokr Chen on Unsplash

How do you know the carbon offsets are valid?

Gold Standard credits, for example, are internationally recognized. All of the offsets on Net0's platform are Gold Standard, Verified Carbon Standard, Climate Action Reserve, American Carbon Registry, puro.earth or equivalent. We offer a diverse range that are all valid. All of the offset projects in Net0's platform have been verified by trustworthy partners so you can be confident that your offsets are really being executed as promised.

There is another theory that buying more than enough offsets will bring companies to net positive instead of just carbon neutral, so they are sure that the emissions are actually being done. Climate positive companies are now in demand. This however can get expensive so most companies aren't willing to go that far. Fortunately, alternatives like renewable energy in the long-term and public transportation are becoming so common that now they are becoming cheaper than the fossil fuels society has been burning.

What carbon offset programs are available?

Net0 offers access to 140+ diverse carbon offsetting projects in the areas of renewable energy, mineralization, biochar, forestry, oceans, bio-oil, landfill methane capture, REDD+, livestock, industrial process emissions, cookstoves, boreholes, and soils, so you can choose from any of the options that work for you in one click. Request a demo to try it out for yourself and see how easy it is to achieve your net zero goals with reliable and trusted offsetting projects all in one place.

list of carbon offsetting options in software platform

How can technology help fight emissions?

Since Net0 was built with AI in its core, its intuitive system gives insight into reductions and cuts out the middle men like expensive agencies, partnership research, unnecessary tax systems, and not being able to control where your offsetting money goes. Technology makes it easy to measure, record, track, analyze, report, and certify emissions that would have been complicated before. We even have a simulator tool within the platform to compare your carbon footprint now to what it could be when you reach your reduction targets. This will help you plan your net zero strategy realistically.

What are the pros and cons of carbon offsetting?

Carbon offsets have pros and cons depending on how the company chooses to use them. 

The pros are that you can carbon capture and remove some of the emissions in the atmosphere already. You can offset residual emissions until you find ways to reduce them. And third, you're contributing to life-changing projects that improve quality of life in the long term.

The cons are that some companies have been accused of greenwashing (giving an image of being more environmentally friendly than they really are), or double counting (when a single offset is counted more than once). However, with transparency standards rising all the time, reporting parties are having to be more thorough so this doesn't happen. The good news is that since Net0 adheres to all GHG Protocol standards, it is easy to view emissions categorized by scope and their offsets with our investor-grade reporting in real-time. It's the best way to have proof that offsets are really occurring, and holds companies accountable. Additionally, it's now mandatory in certain regions and from companies of a certain size to report on their emissions to minimize the risk of greenwashing. Please see our resource section on government compliance policies. These can also be voluntary.

In conclusion

To conclude, carbon offsets are necessary for capturing the carbon emissions in the atmosphere as you find your best practices to reduce what you can in your company. As you make proper reductions, the number of carbon offsets you buy will be reduced every year through lower target-setting as well.

Net0 is an insightful emissions management platform that helps your company reduce carbon until elimination. Not only can you record, calculate, track, and report your carbon emissions all in one place, but you can offset them immediately to contribute to combating climate change. Book a demo today to learn about the platform and how you can offset and reduce your carbon footprint and get carbon neutral certified.

Written by:

Kristin Irish

As a content writer for Net0, Kristin harnesses her expertise and enthusiasm for carbon emissions reduction, merging it with her other passion: the B2B SaaS industry. Her global outlook and dedication enrich the sustainability sector with insightful perspectives.
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