Use of carbon credits for fossil fuel shipments surges

Use of carbon credits for fossil fuel shipments surges

Carbon offsets are increasingly being paired with fossil fuel shipments in deals that have scooped up 5 per cent of all credits used so far this year, according to new research.

About 4.6m of the units, which organisations use to compensate for their emissions, were used to offset hydrocarbon shipments billed as green in the first nine months of 2021, according to data from Trove Research.

That compares with 1.2m offsets paired with fossil fuel cargos in all of 2020.

Trove said there had been “a surge in the use of carbon credits for hydrocarbon products” this year, often marketed as “carbon neutral”.

Roughly 103m offsets were used in total during the first nine months of 2021, the researchers said.

However, one in five of the “offset” hydrocarbon deals struck since 2015 — seven of the 35 in which the information was disclosed — only offset the “scope 1 and scope 2” emissions from the production and transport of the fuel.

Those deals deliberately excluded “scope 3” emissions from the fuel’s use, the most polluting stage of its lifecycle. That made claims of carbon neutrality “potentially misleading”, the researchers said.

The trend of pairing fossil fuel shipments with carbon offsets has taken off this year and has