Types of Carbon Offset Scheme

Carbon offsets are sometimes described as project based because they typically involve specific projects or activities that reduce, avoid or sequester emissions.

Four Types of Carbon Offset Project

• Biological sequestration: Afforestation, Reforestation, Conservation tillage
• Renewable energy: wind farms, solar panels
• Reduction of non-co2 emissions: Methane emission from landfill or coal mines
• Energy efficiency: replace incandescent light bulbs with fluorescent bulbs

Carbon offset integrity is vitaly important:

How do we assess offset integrity?

Of primary importance is the integrity of a carbon asset.

A number of factors (criteria) determine the integrity or quality of an offset project.

Additonality

We suggest that additionality is the most important factor that determines integrity. Additionality refers to whether the offset project (e.g. a wind farm) would have gone forward on its own merits without the support of the offset market. In other words, would the project have happened anyway?

We employ exacting additionality analysis (remember these stringent tests add to the cost of a credit and in turn add to its quality). There exists a clear relationship between offset cost and offset quality.

Other criteria include: Measurement challenges; Permanence; Ownership registration; Monitoring and verification, we only deal in offsets that comply with standards that are considered to be the most stringent.

The higher the standard the more expensive the credit because of the higher transaction costs. There is a clear relationship between offset cost and offset quality.

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