Understanding What Carbon Credits Are

In the midst of all this discussion, you may have heard about various carbon emission reduction programs including carbon taxes as well as cap and trade mechanisms, and carbon offset credits. The subjects and debates can make your eyes water from information overload.

In this article we’d like to concentrate specifically on credits for carbon offsets. They are becoming increasingly well-liked by both businesses and individuals, and we have even started to purchase them for some of our customers with Office Interiors.

It is yet to be determined how much impact offset credits could have on your lifestyle over the next few years as we grapple with how best to combat carbon emissions. However, you may be surprised at the impact they could have on your business in the near future.

What Are Carbon Offset Credits?

As the business community and governments around the world work on plans to combat climate change You will soon hear more concerning carbon offset credits. In simple terms, they are credits which represent an offset against carbon emissions by either a business or an individual. The majority of people get credits for investing in projects that decrease the carbon content of our atmosphere.

Certain companies were created with the sole purpose of aiding organizations and individuals to purchase credits for carbon offset. For instance, a person who drives to work daily can purchase credits that offset the emissions generated by their car. In turn, the money earned from those credits is invested in green initiatives like tree planting programs or projects to generate renewable power.

In a larger sense business, not all companies can modify their processes in a hurry and decrease their carbon footprint, so they might opt to achieve their own green goals by buying carbon offsets.

As climate policies from the government come into place, there may be more need for carbon offset credits as businesses attempt to adhere to regulatory guidelines.

The Benefits of Carbon Offset Credits

After we’ve clarified “What are carbon offset credits,” it’s time to look at the benefits of using these credits. The most obvious advantage is the impact that cash from the purchase of these credits will have on the earth. However, we want to explore a little more than that.

The biggest benefit over the environmental aspect, is its simplicity. Instead of making significant operational changes, businesses could offset carbon consumption simply by purchasing credits. By making a few simple calculations, businesses are able to quickly decide how many credits are required to make their operations a net zero carbon polluter.

There can also be the value of carbon offset credits. For instance, in some cap and trade systems companies are able to trade or sell these credits to other businesses in order to offset their carbon usage. In this regard the company can use those as a form of income or investment.

Carbon offset credits incentivize businesses to adopt positive changes and decrease their carbon footprint. Businesses are always aiming to make the most money and to access carbon credits can be an added cost that adds to their bottom line. So, businesses may be more willing to make the correct changes, which will reduce their requirements to purchase credits to meet their emissions goals.

The negatives of Carbon Offset Credits

Carbon offset credits are far from perfect. For some, they could be considered harmful. The main negative aspect of a carbon offset is that the credit does not constitute a real reduction of carbon emissions by the individual or company.

People and businesses are producing carbon emissions, but those emissions are merely offset by investments elsewhere. While this can result in a net zero carbon footprint, it is difficult to claim that planting trees in another province or country is less carbon-intensive than the carbon generated by your car.

There’s also the cost to consider. Smaller companies may be more difficult to secure these credits than larger businesses with larger operating budgets. Not only is getting credits more difficult on the budget, but small businesses might also have less options to make the necessary changes to reduce their environmental footprint. This could make competition more difficult for up-and-coming companies.

Are you interested in learning more about carbon offset credits?

Are you interested in knowing how carbon offset credits may be beneficial to your company? Contact us today for a more detailed discussion about these credits and their implications for your business.