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Thursday, October 03, 2019

Carbon Trading - Its all in the greenwash

At the recent New York United Nations Climate Action Summit 70 countries made a promise that by 2050, they say they will reach “net zero,” putting no more carbon dioxide into the atmosphere than can be somehow canceled out. With little talk of eliminating the use of fossil fuels, they engaged in some tricky jiggery-pokery with statistics to appear committed to carbon emission reductions. It involves a policy of offsets which permits polluters to get credit for cutting their own emissions by paying someone in another city, state or country to reduce theirs. Buying and selling carbon credits is being promoted by the International Emissions Trading Association, an alliance including oil companies, banks and environmental consultants that get paid to run offset projects.

 Carbon offset schemes were set up to allow the largest polluters who exceed permitted emissions’ levels to fund projects, such as reforestation, that reduce carbon dioxide (CO2) in the air, essentially balancing out their emissions equation.
Shell CEO Ben van Beurden called on policy experts to create trustworthy standards so companies and countries could buy and sell carbon credits on a global scale. “In a way, I don’t care where the standard comes from…as long as it works,” he said. “We want to actually be able to make money out of this.”

Case after case has shown that carbon credits hadn’t offset the amount of pollution they were supposed to, or they had brought gains that were quickly reversed or that couldn’t be accurately measured to begin with. The polluters got a guilt-free pass to keep emitting CO2.

Offsets themselves are doing damage,” said Larry Lohmann, who has spent 20 years studying carbon credits. While we’re sitting here counting carbon and moving it around, more CO₂ keeps accumulating in the atmosphere, he said.

The largest program, the Clean Development Mechanism, came out of the 1997 Kyoto Protocol, when dozens of nations made a pact to cut greenhouse gases. European leaders wanted to force industry to emit less. Americans wanted flexibility. Developing nations like Brazil wanted money to deal with climate change. One approach they could agree to was carbon offsets.

The idea worked marvelously on paper. If a power plant in Canada needed to shave 10% off of its emissions but didn’t want to pay for technology upgrades, it could buy offsets from projects in the developing world. Investors planning to build a coal plant in India could instead decide to build a solar plant, using the money from the anticipated sale of carbon credits to cover the higher costs of developing solar power. The gap in emissions between the hypothetical coal plant and the actual solar farm would be converted to offsets. (Each credit is equal to the global warming caused by a metric ton of CO₂.) The program subsidized thousands of projects, including hydropower, wind and, infamously, coal plants that claimed credits for being more efficient than they would have been. CDM became mired in technical and human rights scandals, and the European Union stopped accepting most credits. A 2016 report found that 85% of offsets had a “low likelihood” of creating real impacts.

Another global program, Joint Implementation, has a similar track record. A 2015 paper found that 75% of the credits issued were unlikely to represent real reductions, and that if countries had cut pollution on-site instead of relying on offsets, global CO₂ emissions would have been 600 million tons lower.

Buying carbon credits in exchange for a clean conscience while you carry on flying, buying diesel cars and powering your homes with fossil fuels is being challenged by people concerned about climate change. Scientists, activists and concerned citizens have started to voice their concerns over how carbon offsets have been used by polluters as a free pass for inaction.

UN Environment supports carbon offsets as a temporary measure leading up to 2030, and a tool for speeding up climate action,” says UN Environment climate specialist Niklas Hagelberg. “However, it is not a silver bullet, and the danger is that it can lead to complacency.

Last March, more than 90 researchers and academics signed a letter urging policymakers not to rely on carbon markets or offsets to solve climate change, citing a history of environmental and social problems, explaining that:

It is well documented that carbon markets have failed spectacularly in achieving their environmental objectives and that many carbon offset projects have a devastating social impact. In spite of this evidence, carbon markets remain the main policy tool to address climate change in Europe, based on the misguided hope that they will work “once the price is right”. Yet, beyond the well-known issues of excess permits and frauds, it has also been demonstrated that carbon markets have major conceptual flaws that cannot be fixed, such as the inability to provide a reliable price signal or the fact that the climate impact of offset projects is not calculable. When carbon becomes a new asset class for investors, carbon markets will be much more vulnerable than traditional financial markets to crashes and abrupt losses of confidence from investors, with a high risk of contagion to other asset classes and the wider economy. ”

We ought to focus on making sure that emissions reductions are real and verified,” Nathaniel Keohane, an environmental economist at Environmental Defense Fund. Keohane said that even if the world maximizes its use of offsets, major polluters like the United States won’t be able to reach net zero without also slashing their own fossil fuel use. There just aren’t enough carbon credits to do it for them.

Taken from Here

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