A Matter of Trust, Part 4 - Adding Structure and Credibility to Carbon Offsets

RBN Energy Blogcast

In the recently fervent efforts of oil and gas companies to mitigate their environmental impact and improve their standing with investors and lenders, they are progressively striving to cut their own emissions of greenhouse gases and to offset the GHG emissions that are unavoidable through the use of carbon credits. Cutting emissions from well sites, pipeline operations, refineries, and the like won’t be easy or cheap, but at the least the results are measurable and provable — before, we emitted X, and now we emit X minus Y. The true value of voluntary carbon credits is more difficult to calculate. Sure, each credit is said to equal one metric ton of carbon dioxide or its equivalent, but how do you really measure with any certainty how many metric tons of CO2 will be absorbed by 1,000 acres of preserved forest in Oregon, or how much methane won’t be produced by changing the diet of 1,000 cows in Wisconsin? And how can you be sure that slice of Oregon wouldn’t have been left in place anyway, or that the dairy farmer has actually changed what he’s feeding his herd? In today’s RBN blog, we look at voluntary carbon credits, concerns about their validity, and ongoing efforts to ensure that they actually accomplish the goal of GHG reductions.