The carbon offset market is falling short. Here’s how to fix it

The carbon offset market is falling short. Here’s how to fix it

Few would consider drilling oil to be a path to net zero emissions. But that was, in effect, what the offset provider Bluesource claimed when it worked with Merit Energy to capture CO2 and pump it underground to squeeze more oil out of a well — a process termed enhanced oil recovery. The carbon credits Bluesource sold counted the emissions savings from the CO2 that was put underground, but ignored the carbon footprint of the oil that was pumped out.

This extreme example illustrates how voluntary offsetting — purchasing carbon credits to balance against one’s own emissions — needs rules. Some offsetting projects provide real benefits. But, like any unregulated marketplace, offsetting overall is falling short.

How short? A lack of transparency makes even this basic question hard to answer.

The Net Zero Tracker — an independent research consortium that I co-lead — records the quantity and quality of net zero targets around the world. Shockingly, 91 per cent of country targets, 79 per cent of city targets, 78 per cent of regional targets, and 48 per cent of listed company targets fail to specify if offsets will be used in their net zero plans.

Similarly, of the companies with a net zero target