Carbon offset guidance

Introduction to carbon offsets 

A carbon offset is a project or activity that reduces emissions of greenhouse gases to compensate for emissions created elsewhere. The Clean Development Mechanism of the United Nations Framework Convention on Climate Change offers the public and private sector in high-income nations the opportunity to purchase carbon credits from offset projects in low- or middle-income nations. Common types of offset projects include forestry and land use, renewable energy, energy efficiency, methane destruction, industrial gases, fuel switching, and clean cookstoves.

Carbon offsets are controversial because it is difficult to demonstrate that they are additional measures that permanently remove greenhouse gasses from the atmosphere. In addition, they may generate wider ecological or societal damage in their application, create a false sense of emissions reduction, and distract from the main goal of decarbonization. Indigenous people and local communities are not always consulted, and may not benefit, and in some cases may be actively harmed, from offset projects. This position paper by Friends of the Earth International makes a strong case against carbon offsets and markets.

Health Care Without Harm and Practice Greenhealth recognize that protecting our health and well-being from the worst impacts of climate change will require both eliminating emissions and removing carbon from the atmosphere – and doing both quickly. We believe carbon offsets must not be used as a replacement for actions to decarbonize an organization’s footprint, but only as a temporary stopgap to address residual emissions until practical solutions can be developed. Residual emissions are emissions that are generally recognized by the sector as particularly difficult or expensive to remove despite targeted interventions, investment, and focus. 

For U.S. health systems that have set ambitious carbon reduction goals, purchasing carbon offsets may be necessary for the short term. Given that the carbon offset market is still evolving, there is an inherent level of risk in selecting projects and there are past examples of projects that did not meet their promised reductions or had unintended impacts. To address these concerns, Health Care Without Harm and Practice Greenhealth have developed guiding principles for offset purchases. 

Principles for Carbon Offsets

The overarching principle is that residual emissions should be separately and transparently identified and reported so that reducing emissions remains the primary focus. At any point in time, health systems should clearly designate which emissions are being considered residual emissions, and how decarbonization goals will help reduce these over time as technology evolves and other sectors decarbonize. Health sector decarbonization commitments and efforts will also play an important role in decarbonizing residual emissions across sectors as they influence the market and energy transitions.

If a health system purchases carbon offsets to manage residual emissions, the offsets should follow the World Resources Institute principles to ensure offsets are real, permanent, additional, verifiable, and enforceable. In addition, health systems should strive for offsets that are transparent, have health co-benefits, promote justice and equity, and remove carbon from the atmosphere in the same timeframe as the emissions they are offsetting. 

World Resources Institute principles

1. Real: GHG offsets must represent one ton of CO2e greenhouse gas emissions reduced or sequestered as a result of an activity undertaken to reduce emissions. The quantity of emission reductions should not be inflated by incomplete accounting, which could occur if emissions were reduced at one location but increased elsewhere as a result (known as emissions “leakage”).
2. Permanent: Emission reductions or removals are permanent if they are not reversible; that is, the emissions can’t be rereleased into the atmosphere. There are mechanisms to account for or reduce the risk of reversal, though they can bring additional costs. (To comply with the permanent principle, look to other established entities to confirm the 100-year lifespan requirement for forestry projects: e.g. Climate Action Reserve Forest protocol or California Air Resources Board Forest Offset Protocol.)
3. Additional: In order to generate offsets, a project must be a response to the incentives provided by a carbon offset market. Activities that would have happened without such incentives are business-as-usual and do not represent new emission reductions. 
   • Project-specific additionality is determined through an evaluation of the proposed project against a range of alternative scenarios.
   • Standardized additionality criteria evaluate projects against a set of consistent criteria for a particular project type and are intended to exclude non-additional projects, without developing a business-as-usual scenario for each individual project.
     (To comply with the “additional” principle, look to established registries to ensure that the project is registered and not double-counted: e.g. American Carbon Registry, Climate Action Reserve, or Verra)
4. Verifiable: Credible offset programs require that emission reductions be monitored and regularly verified by an independent, qualified third party. (To comply with the “verifiable” principle, look to established and independent third party standards for offset projects: e.g. The Gold Standard, Verified Carbon Standard, Green-e certified, or The Climate Action Reserve)
5. Enforceable: One credit can only credibly offset one ton of CO2e emissions; as a result, it must be tracked and it must be possible to enforce its ownership and use to avoid double counting. This is usually done via a registry.

Additional principles for health system offsets

1. Health co-benefits: Provides health benefits to the community where the project is taking place.
2. Justice and equity: Directly addresses social and environmental justice and/or health equity issues through planning, community engagement, implementation, and outcomes.
3. Transparent: Project details (including project type, location, developer, duration, standard employed, etc.) are known to the institution and transparently communicated to stakeholders to help ensure validity and further the goal of education on climate disruption and sustainability.
4. Offset projects must remove carbon from the atmosphere in the same timeframe as the emissions they are offsetting: Projects that result in reductions of GHG emissions over a long period of time do not help us achieve near-term carbon reduction goals. For example, if you burn a tree today and plant one that takes 30 years to remove the same amount of carbon from the atmosphere, you will still have increased emissions in 2030. Given the urgent need to reduce carbon levels in the atmosphere in the short term, today’s emissions must not be offset by the promise of future carbon removals that may or may not materialize. Long-term carbon sequestration projects like reforestation are positive, and essential to achieving a stable climate, but must not be used to enable continued emissions today. 
5. Consider a local approach, and prioritize impact: One approach health systems can explore is to look for local offsets, investing in projects that do the most to improve the health and resilience of the disproportionately impacted communities they serve. This approach could include investing in local residential energy efficiency, renewable energy, or tree planting. Examples of these projects can be seen in the higher education sector in the U.S. through the Finger Lakes Fund and the Duke University Carbon Offset Initiative, and in local tree planting projects through organizations like Forterra.