(4 November 2024 – Global) Demand for carbon credit offsets has softened as large enterprises such as Alphabet, Shell, Fortescue Metals Group, Nestlé, EasyJet and Delta walk back new sustainability strategy purchases, instead pivoting to direct emission reductions.
Corporations are gradually reducing their reliance on their favoured climate remedy as greenwashing concerns continue to rise, MIT Technology Review reports. Major enterprises have recently announced they are backing away from offsets or the claims of carbon neutrality that relied upon them with a high proportion expressing serious concern about the “reputational risk” raised by public criticisms of carbon offset projects.
For example the recent New Yorker article asserted that millions of carbon offsets generated by Kariba, a major project that earned nearly US$100 million for purportedly preventing deforestation in Zimbabwe, didn’t actually prevent deforestation and preserve the carbon in the trees and soil.
“People have simply slowed down what they’re doing and are being more careful and taking longer to get to ‘yes’. And that’s a good thing” commented Carbon Direct Chief Science Officer, Matthew Potts.
“Companies hoping to balance out their emissions can purchase carbon credits through intermediaries, and then ‘retire’ them to apply them against their emissions and ensure that no other party can count them against theirs often as a single step. But Carbon Direct estimates that those retirements are on track to decline by about 25 percent from 2021 levels by the end of this year. Issuances of new credits will also fall by about seven percent over that period.”
“Companies are backing away from credits that merely claim to prevent emissions, as when landowners agree not to cut down forests. The problem, as companies and critics have become increasingly aware, is that it’s often impossible to prove they intended to break out any chainsaws in the first place.”