Carbon Offset

Carbon offsets are emission reductions achieved through a compensatory activity rather than at source.

In 'cap-and-trade' schemes, companies are assigned emission 'caps' or limits they must not exceed.

If they cannot meet the cap, they can invest in a programme that reduces emissions outside their sector, generating a carbon offset, which they can then apply against their own emission to meet the cap.

Carbon offset investments could include reforestation, tree planting, renewable energy, methane capture/combustion, and more.

It's important to note that offsetting should only be used after an organisation has done all it can to reduce emissions; so that we are striving to cut our overall carbon emissions completely rather than simply offsetting the damage.

Whilst carbon offsetting is a good practice, the more that companies can do to authentically reduce their carbon emissions, the more cost effective it will be in the future, when larger organisations will start paying for their carbon emissions through carbon taxation.