Carbon Retirement: The Effective Alternative

Photo: Johann kr

As a financial instrument created to reduce greenhouse gas emissions, carbon offsets might seem like the best idea in the world. They are purchased by corporations or governments in order to comply with caps on the amount of carbon dioxide they can emit into the atmosphere. The purchase of one carbon offset is equal to the reduction of one metric ton of carbon dioxide. Typically, they are intended to fund projects that seek to reduce quantities of greenhouse gas emissions.

Unfortunately, carbon offsetting does not discourage large corporations from continuing to pollute the atmosphere, nor does it motivate them to innovate or invest in new technologies. Rather than try to run their companies at peak carbon efficiency, they can simply pay a nominal tax on the amount they go over. Furthermore, some projects funded by carbon offsets are of dubious origin, and even with legitimate ones, there is no guarantee they will reduce CO2 emissions in levels equivalent to what is being produced.

Photo: Yodel Anecdotal

In order to dissuade companies from using carbon offsetting as a crutch, the answer may be to turn to carbon retirement. Carbon retirement vendors purchase these carbon offsets from the government before they can be distributed to large polluters. Then the vendors cancel the credits, effectively retiring them from the system forever. Since the total number of carbon offsets is fixed by the number of projects that need funding, having the people consume and 'retire' them can force large companies to either lower emissions or pay heavy fines. This can help individuals not only achieve carbon neutrality but encourage the industry itself to be more responsible.

In summary, the benefits of carbon retirement are as follows:

• There are no questions as to whether the reduction happened. By removing the carbon offset from the system, it can no longer be used as an excuse to emit greenhouse gases.
• Carbon retirement is fully endorsed by the UK government, and accredits the offsets they sell.
• It is transparent and easy to explain. Carbon offsets are purchased and canceled. There is no risk the carbon offset will be put toward an illegitimate project.
• By leveling the playing field, developed countries can no longer act sanctimoniously while continuing to emit greenhouse gases. They must lower their emissions without the use of allowances.
• By forcing companies to spend their money on innovation, renewable energy companies receive a boost.

Carbon retirement is the only way to be sure that 100% of your funding is being used toward reducing greenhouse gases. It induces long-term behavioral changes not only in technological countries but in the developing world, where industrial revolutions depend largely on carbon heavy machinery and fossil fuels. Rather than give yourself an allowance, with carbon retirement you can take an allowance away from the companies that are truly responsible for the global warming problem.