Why carbon offsets are worse than you think?

0:00 Do you know that check box you can tick 0:02 when booking a flight, or ordering a package – 0:05 that promises you can offset all of the carbon 0:07 that you just emitted, and you’re good? 0:10 Have you ever wondered whether that’s actually legit? 0:14 And we’re not the only ones who can 0:15 apparently buy our way out. 0:17 Some of the world’s largest companies are relying 0:19 heavily on carbon offsets to reach their ambitious climate pledges. 0:23 Apple is going carbon neutral. 0:25 ...carbon neutral 0:26 That’s why, at Shell, our ambition is to be a net-zero 0:29 emissions energy business by 2050. 0:32 Yep. 0:32 Even fossil fuel companies are vowing to emit 0:35 net zero carbon soon – 0:37 in large part thanks to carbon offsets. 0:39 How the hell is that supposed to work – 0:41 and are carbon offsets in general to be trusted? 0:44 And why am I stuck in the mud in the middle 0:46 of nowhere to answer that? 0:49 Hi I’m Kiyo Dörrer, and you're seeing climate action... 0:52 in action! 0:55 So cheesy. 1:01 I know carbon offsets don’t sound that sexy, 1:04 but they are kind of a hot topic right now. 1:06 So the basic idea of an offset is that 1:09 if you’re naughty and emit a lot of carbon, 1:11 you can pay to have those emissions reduced somewhere else. 1:16 The logic is that since the emitted CO2 goes into the atmosphere and 1:20 damages the entire planet, 1:22 you can cancel it out anywhere – 1:24 preferably somewhere where it’s easier 1:26 and cheaper to do so. 1:28 But I’m getting ahead of myself. 1:31 Probably the first thing that comes to mind 1:33 when you think offsets are trees – 1:35 planting them or protecting them 1:38 from being cut down. 1:39 Trees of course sequester carbon, 1:41 making them a very popular offset. 1:43 Or you could pay projects to install renewable energy 1:47 – like wind, solar or biogas. 1:51 Then we get to the nichey stuff: 1:52 Capturing the excess methane 1:54 that seeps out from landfills or open coal mines. 1:58 Effective, since methane is about 25 times 2:01 more potent than CO2. 2:03 Or you can have even worse greenhouse gases 2:05 destroyed or avoided, like laughing gas, 2:07 which is about 300 times worse than CO2. 2:10 So I wanted to know exactly where my money 2:13 goes to when I compensate my own private carbon footprint. 2:17 Let’s say I’m flying from Berlin to Tokyo. 2:22 Please don’t shoot me, 2:24 I’m visiting my family. 2:25 So there is a box here where I can say offset CO2 emissions. 2:30 That says supports ten international projects for a global impact. 2:35 But I want to know which, and I want to know where. 2:38 [The] majority of projects are in the Global South, but there are a few in Europe. 2:44 So two of the projects are in Germany actually, and both are not that far away. 2:50 Let’s go there! 3:01 Hi, I’m Kiyo! 3:04 I’m Karen. Welcome to Königsmoor! 3:07 Karen Marggraf sells carbon offsets for a 3:09 non-profit in Germany’s northernmost state. 3:15 So my question is: what happens to my money? 3:19 It's supposed to reduce my CO2 emissions – how does that work here? 3:22 All this area was drained to make way for agriculture. 3:32 And drained wetland is a bit like a carbon factory. 3:38 That’s because the organic matter in wetlands 3:40 called peat stores a lot of carbon over oftentimes thousands of years. 3:45 But when the peatland gets drained and dries out, 3:48 the carbon comes in contact with the oxygen 3:51 on the surface and emits CO2. 3:55 A mind-boggling amount of it actually. 3:57 About five percent of all man-made greenhouse gas emissions come from damaged peatlands. 4:02 That’s more than twice the greenhouse gases emitted by aviation globally. 4:08 To reverse that, this project is aiming to rewet this landscape. 4:14 The peat layer is being removed, 4:18 and dams are being built with it 4:21 to contain rainwater within the area. 4:26 So you’re building a pool? 4:28 A basin, a pool, that’s right. 4:40 Around the corner there is a dam that was 4:42 completed half a year ago. 4:44 We’re standing on one of the dams. 4:46 Now that we’ve managed to raise the water level, the rainwater is kept in by the dams 4:53 and the carbon can’t escape. 4:56 Once the wetland is intact again and vegetation grows back, 5:02 additional carbon will be captured from the atmosphere. 5:06 The rule of thumb is: 5:09 every hectare absorbs about ten tons [of CO2] per year. 5:15 To put that into perspective: A flight back and forth 5:19 from Germany to Japan alone emits about three tons of CO2. 5:24 So you really need a lot of wetland to compensate emissions. 5:28 And this is what that water basin turns into after a few years. 5:32 The land is being reclaimed by nature. 5:39 These moor offsets are voluntary offsets. 5:41 Meaning that anybody can buy them voluntarily – 5:44 if for example they want to reduce their flight shame 5:47 like I do. 5:48 And companies can also buy them – to offset their millions of tons of emissions. 5:55 But there are also mandatory offsets. 5:57 Mandatory offsets are offsets that companies have to buy to stay under 6:02 the maximum amount of carbon they are allowed to emit per year. 6:07 This mechanism was set in place by the Kyoto protocol and updated in the Paris agreement. 6:12 The mandatory market used to make up the lion’s share of offsets, but that’s changing rapidly. 6:16 You can imagine why when we rewind to those carbon neutrality promises. 6:20 Last time I checked, you can’t produce cars, 6:23 or deliver goods, or pump oil out of the ground 6:26 – without emitting CO2. 6:28 So to get to Net Zero, you need some of that 6:30 sweet bookkeeping magic. 6:33 The voluntary market has been growing rapidly 6:35 in the past years. 6:37 And 2021 is likely to set a new record. 6:40 Renewable energy as well as forestry and land 6:43 use projects are currently 6:44 by far the most popular offsets. 6:47 There's just one small problem: 6:50 Many of the carbon offsets just don’t offset carbon. 6:53 Whoops. 6:55 There's lot of dirty tricks happening in carbon offsetting where one ton of carbon 6:58 ends up becoming half a ton of carbon and in many cases even zero tons of carbon. 7:03 That’s Yeb Sano, head of Greenpeace Southeast Asia. 7:07 Offsetting has a very long and well documented 7:09 history of problems with the validity of carbon offsetting projects. 7:14 A landmark 2016 study found out that 85 percent 7:19 of the mandatory carbon offsets the Kyoto Protocol had put in place 7:22 were not decreasing CO2 in the atmosphere. 7:26 85 percent. 7:28 And not much has changed since then. 7:31 One small example: Another study by a 7:33 carbon offset broker recently looked at 7:35 a hundred voluntary offsets – 7:37 mostly the popular afforestation and conservation projects – 7:41 and found that over 90 percent don’t deliver on their promises. 7:44 So how the hell is that possible? 7:46 Well, it has to do with the very complex nature of carbon offsets. 7:51 So back to the peatland. 7:53 Question is whether the project that you're 7:56 funding might have just happened anyway and if that's the case, then your payment isn't 8:02 really making a difference. 8:03 This is Derik Broekhoff, he has worked on 8:06 energy and climate policy for more than 18 years. 8:10 It's not really causing emissions to go down. 8:13 So this is the real Achilles heel of the carbon offset market. 8:17 What would have happened here without the carbon offset money? 8:22 It would have continued to be used as farmland. 8:29 It would still be drained and it would have continued 8:33 to emit huge quantities of CO2 into the atmosphere. 8:37 This project is what is called additional. 8:40 The money invested had an additional effect of reducing emissions that wouldn’t have 8:44 happened otherwise. 8:46 And that’s most often the case for projects that would not be economically viable without 8:50 offset money. 8:52 For example: destroying industrial pollutants. 8:54 There is no financial reason for this to happen. 8:57 The only reason why this gets done is because people pay for it to be done. 9:01 A lot of methane capturing and 9:03 destroying projects are similar. 9:06 But now we get into trickier territory. 9:10 It's not so clear in a lot of energy efficiency 9:15 projects, renewable energy projects. 9:18 That was the case for example in India. 9:20 A study showed over half of wind turbines built with carbon offset money would most 9:25 probably have been built anyway. 9:28 Planting trees or conservation projects can 9:30 also be problematic. 9:32 Because planting trees is nice and good and all. 9:34 And they are great CO2 suckers – 9:36 but only as long as they live. 9:38 Many of the projects on paper have promised 9:40 those plantations stay for the longest time 9:43 and then after ten years you visit the site and it’s gone. 9:47 For example: Satellite images collected by 9:50 Pro Publica in Cambodia show that in the 9:53 forested areas that should have been 9:54 completely protected, half of the forest 9:57 has been logged or otherwise destroyed 9:59 ten years later. 10:02 Forest fires are another big risk. 10:05 Because burnt trees aren’t gonna sequester carbon any time soon. 10:11 Afforestation and reforestation are seen as 10:14 so problematic that the EU does not allow them as mandatory offsets. 10:18 So, as popular as they are, they are not the safest bet. 10:24 The next question is: Will the problem just go elsewhere? 10:28 Let’s say you buy carbon offsets to help 10:30 save the Amazon from deforestation in Brazil. 10:33 Maybe that will just shift the problem 10:35 to parts of the Amazon that are not protected. 10:37 And the rainforest will get logged in neighboring Peru. 10:41 And last, but certainly not least, 10:44 is the problem of double counting. 10:46 Or: Who gets bragging rights? 10:51 In the case of this moor, it’s quite simple. 10:53 A German airline emits CO2 by flying its planes 10:57 and reduces that CO2 by rewetting this moor. 11:01 Germany overall gets to reduce its emissions. 11:03 But what if that same German airline reduces 11:06 its emissions by planting trees in Nicaragua? 11:09 Which, yes, it also does. 11:11 Who gets to claim the reduction in emissions? 11:14 This may sound like a technicality, 11:16 but it’s one of the major problems 11:18 carbon offsets are facing. 11:20 No two countries or no two actors should 11:23 be counting the same emission reduction 11:26 towards their emission reduction goals. 11:29 Unless double counting is avoided, 11:31 my purchase of the carbon credit makes 11:33 no difference to global emissions. 11:36 So, Nicaragua in this case would have to allow 11:39 the foreign, German company 11:40 to count these offsets as their own 11:42 for collective emission reductions to work. 11:45 While the mandatory market has set rules to 11:48 ensure this, the voluntary market does not have any. 11:52 And that ties into a bigger problem: 11:55 Imagine you are a multi-billion-dollar company 11:57 wanting to offset your millions of tons of CO2. 12:00 It’s very tempting to offset your 12:03 massive carbon footprint in the easiest, 12:05 cheapest way, right? 12:06 Which, in a lot of cases, means less regulated, 12:09 easily implemented projects, often in the Global South, where restrictions are not so 12:13 rigorous and prices are low. 12:15 Not to mention – many offsetting programs 12:17 have a history of disrespecting land rights of indigenous and local communities. 12:22 It’s really hard for a normal consumer to tell 12:25 whether a project is legit or not. 12:27 I mean I travelled all the way here, this checks out. 12:30 But you can’t do that for every single project. 12:33 One indicator though can be price. 12:36 How much does it cost to offset a ton of CO2 here? 12:41 One ton of CO2 costs 64 euros. 12:47 That’s quite steep – some carbon offset 12:50 platforms offset a ton for 23 Euros – 12:52 or even 11 USD – about 10 Euros. 12:56 When single carbon offset schemes are way 12:58 below that price, that’s not a good sign. 13:01 Any activity that was going to happen anyway 13:04 can generate emission reductions for essentially zero marginal cost. 13:08 I would be wary of a large number of project credits that are inexpensive. 13:16 Ok, quick recap: many projects don’t offset carbon, 13:20 and some carbon offsets may also help big corporations to greenwash. 13:26 But – and the IPCC calculations show that 13:28 – it will be extremely hard to reach our 13:30 climate targets without some form of offsets. 13:34 So what should we do? 13:36 There has to be an oversight function, 13:38 a system, an institution that could truly 13:42 guard against cheating and misrepresentation 13:46 in the way carbon offset projects are being run. 13:49 There are international certifications that 13:51 are supposed to guarantee the quality, 13:53 like the Gold Standard as well as 13:55 the Verified Carbon Standard – 13:57 but even they are not always watertight, 13:59 and certifications are voluntary. 14:03 Then there also needs to be a change in the type of projects we focus on. 14:07 A lot of the market to date has been oriented 14:09 around cheaper mitigation and I think we need to flip that around. 14:13 Focus on where the investment is needed to 14:17 bring about transformational change. 14:20 But first and foremost: 14:22 You should always start by asking yourself, 14:24 how can I reduce or prevernt emissions. 14:27 That’s got to be the first option. 14:29 Many companies do clearly state that in their 14:31 net zero strategies. 14:33 But it’s often unclear how many of the tons 14:35 of emissions are getting reduced – 14:37 and which get offset. 14:38 Major polluting companies are trying to 14:42 find a way out of taking real action 14:44 to tackle the climate emergency. 14:46 The world can't offset its way out of climate change, 14:49 we all need to be reducing emissions 14:52 and doing so rapidly. 14:55 So: after all this information, 14:58 would you buy a carbon offset now? 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