What is Carbon Offsetting?

Carbon offset is a term used to refer to both the action and the credit of offsetting carbon. A net zero strategy involves reduction first, then Carbon credits are utilised to balance the company's emissions, thus helping to decrease its carbon footprint. Offset units are generated from projects that either reduce, remove or capture atmospheric emissions. In essence, carbon offsetting refers to any reduction of greenhouse gas (GHG) emissions that compensate for emissions taking place elsewhere. By obtaining carbon offset credits, an organisation demonstrates that it has successfully decreased its net emissions.

What is Carbon insetting?

Carbon offsetting allows a business to purchase carbon credits from projects they don’t own or operate to offset their carbon emissions. Insetting refers to financing climate protection projects along a company's own supply chain that reduces or sequesters emissions and thereby positively impacts the communities, landscapes and ecosystems associated with the supply chain. Carbon insets can not be purchased instead, projects are funded, and the impact is measured.

Carbon Offsets and Credits

Carbon offsetting projects aim to reduce carbon emissions by removing them from the atmosphere or preventing their release. These projects can register to generate carbon credits, with each credit corresponding to one metric ton of CO2 absorbed or reduced. The projects are registered through a carbon credit certifier; credits are then traded on the Voluntary Carbon Market.

Types of carbon offsetting projects