Are Carbon Offsets Good for the Environment? The Big Picture

Are Carbon Offsets Good for the Environment? The Big Picture

Grace Smoot

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Carbon offsets have been dubbed a cure for climate change because they can reduce emissions in areas of our lives where reductions would otherwise be impossible. But, as with anything, carbon offsets have limitations. And these limitations may cause more harm to our environment than they do good. So, we had to ask: are carbon offsets good for the environment?

Carbon offsets are not good for our environment in the long term because they are not environmentally sustainable and do not reduce climate change. They have limitations involving effectiveness, credibility, and success rates. Reducing emissions from the source is better for the environment.

Keep reading to learn how carbon offsets impact our environment (either positively or negatively), how you can make carbon offsetting more environmentally beneficial, and what some environmentally-friendly alternatives are. 

How Are Carbon Offsets and the Environment Defined

Carbon offsets can play a crucial role in reducing our carbon footprint, the amount of carbon dioxide (CO2) emissions associated with an individual or an entity. They are measured in tons of CO2 equivalents and are bought and sold through international brokers, online retailers, and trading platforms. 

Carbon Offset: a way for a company or person to reduce the level of carbon dioxide for which they are responsible by paying money to a company that works to reduce the total amount produced in the world, for example by planting trees”

Oxford Dictionary

When you hear the words “carbon offset”, think about the term “compensation”. Essentially, carbon offsets are reductions in greenhouse gas (GHG) emissions that are used to compensate for emissions occurring elsewhere. And reductions in GHG emissions can benefit our environment by mitigating climate change.

Environment: the air, water, and land in or on which people, animals, and plants live”

Cambridge Dictionary

Our environment is currently plagued by rising sea levels, acidified oceans, loss of biodiversity, more frequent and severe weather events, and other environmental disasters caused by increased CO2 emissions. Carbon offsets can benefit the environment by reducing CO2 emissions, thereby slowing the rate of temperature rise, sea-level rise, ice melting, and ocean acidification

Here’s How Carbon Offsets Impact the Environment

Reducing carbon emissions via carbon offsets is one way to mitigate climate change and ensure a sustainable planet for future generations. However, some assert they do more harm than good for our environment due to a variety of limitations involving their effectiveness, credibility, and success rates.

Environmental ImpactQuick Facts
Carbon offsetting is generally not environmentally sustainableCarbon offsets do not work at the core issue of reducing CO2 emissions
There are not enough carbon offsets for all CO2 emissions
Not All Carbon Offset Projects Get Realized
Carbon offsetting does not effectively reduce climate changeCarbon offsets only reduce CO2 emissions if the projects are additional and permanent
Not all carbon offset projects are effective in reducing CO2 emissions
Not all carbon offset projects are effective in reducing CO2 emissions

Carbon offsetting is not good for the environment because it does not promote environmental sustainability and does not reduce climate change. 

Why Carbon Offsetting Is Generally Not Environmentally Sustainable

Being environmentally sustainable means interacting with the planet in a way that preserves natural resources and maintains global ecosystems for future generations to use. It begins with us paying more attention to global environmental concerns and evaluating our use of natural resources and our collective carbon footprint.

The environmental sustainability pillar encompasses 6 subtopics: 

  1. Ecosystem services
  2. Green engineering 
  3. Green chemistry
  4. Air and water quality
  5. Stressors
  6. Resource integrity

Carbon offsets are not environmentally sustainable because they do not work at the core issue of reducing CO2 emissions, there are not enough offsets for all CO2 emissions, and not all carbon offset projects get realized.

Carbon Offsets Do Not Work at the Core Issue of Reducing CO2 Emissions

Every year we pump upwards of 35 billion tons of CO2 into the atmosphere. Opponents of carbon offsets assert that instead of substituting offsetting carbon emissions, we should instead cut the emissions directly at the source. But have we done this? Have we cut emissions directly at the source? The data says no.

Illustration of annual CO2 emissions globally
Our World in Data: Annual total CO2 emissions

The COVID-19 pandemic triggered the largest decrease in energy-related carbon emissions since World War II, a decrease of 2 billion tons. However, emissions rebounded quickly at the end of 2020, with levels in December ending 60 million tons higher than those in December 2019. This indicates that the earth is still warming at an accelerated rate, and not enough is being done to implement clean energy practices. 

In short, carbon offsetting mitigates the problem, but it doesn’t work at the core issue of reducing overall CO2 emissions. A more effective way of reducing CO2 emissions is to cut them at the source.

There Are Not Enough Carbon Offsets for All CO2 Emissions

The carbon emissions we pump into the atmosphere every year cause climate change, air pollution, acid rain, ocean acidification, and the melting of glaciers and polar ice. Offsetting all CO2 emissions is not only difficult, but it is also impractical because there aren’t enough carbon sinks to offset every ton of CO2 produced from our collective human activities. 

Carbon Sink: an area of forest that is large enough to absorb large amounts of carbon dioxide from the earth’s atmosphere and therefore to reduce the effect of global warming”

Cambridge Dictionary

The main carbon sinks are:

  • Forests: They absorb 2.6 billion tons of CO2 every year. The main threat to this sink is deforestation, which occurs at roughly 10 million hectares (~ 25 million acres) per year. 
  • Soil: They absorb approximately 25% of all carbon emissions, with most of it stored as permafrost. Not only that, but Earth’s soil contains 2,500 gigatons of carbon, more than three and four times the amount stored in our atmosphere and in all living plants/animals, respectively. One of the main threats to this sink is the melting of glacier ice due to global warming, which would instead release massive amounts of carbon into our atmosphere. 
  • Oceans: Phytoplankton in our oceans are responsible for absorbing approximately 25% of all carbon emissions, making them one of the world’s largest carbon sinks. But this absorbing ability has come at a cost. Increased absorption of CO2 causes ocean acidification. Over the past 200 years, our oceans have experienced a 30% increase in acidity, which harms marine life and has a ripple effect on our economy.

Once those sinks fill up, we won’t be able to offset any more carbon. Also, the more carbon we add to these sinks, the faster we degrade them and render them unusable.

Another point of concern is that we may have already exceeded Earth’s carrying capacity or the maximum number of people that the earth can sustain indefinitely. Our population is rapidly approaching 8 billion and increases by approximately 140 million people per year. The ecological footprint, the amount of environmental land needed to produce the goods that support a particular lifestyle, also continues to increase which means we are impacting the environment at levels that cannot be sustained indefinitely.

As the population and our ecological footprint grow, the need for more offsets also grows. And we already do not have enough offsets for all of our emissions. 

Not All Carbon Offset Projects Get Realized

To date, credits for ~1 billion tons of CO2 have been listed for sale on the VCM. But the number of sellers exceeds the buyers by about 600-700 million tons. Meaning that only about 300-400 million tons of CO2 offsets actually get realized. This means that between 600 and 700 million tons of CO2  are emitted but not offset

When credits are listed but not realized, we are not mitigating any effects of climate change. In return, the rates of temperature rise, sea-level rise, ice melting, and ocean acidification continue to increase as the earth warms.

When offsets do not get realized they do not offset any carbon. And when this doesn’t happen, we don’t reduce any emissions. 

Why Carbon Offsetting Does Not Effectively Reduce Climate Change

Carbon offsets that are additional and permanent and are a part of projects that are carried out until the end of their lifespan have the best chance of reducing carbon emissions and therefore reducing climate change. But this is often not the case, and not all projects have equal effectiveness rates.

Carbon Offsets Only Reduce CO2 Emissions If the Projects Are Additional and Permanent

If carbon offset projects are not additional and permanent, they can actually make climate change worse rather than reducing emissions.

To be beneficial, carbon offsets must be additional. This means the reductions would not have occurred without an offset market. If offset programs are not additional, then offsetting rather than directly reducing your emissions can actually worsen the effects of climate change.

The concept of additionality is deceptively difficult to evaluate and is often misunderstood. GHG reduction activities are occurring all the time, whether they are required by law or are simply a profitable action to take. For a project to be additional, the ability to purchase carbon offsets must play a decisive role in whether or not it is implemented. Also, determining additionality requires comparing it to an instance where there is no revenue from the sale of offsets. The only way to determine this is via subjective predictions. 

Carbon offset projects also must also be permanent, in the sense that there must be a full guarantee against reversals of carbon emission into the indefinite future. Most projects are permanent by nature, but a classic example is sequestering carbon in trees. Once a tree is planted, it should never be removed to guarantee permanence. Cutting down the tree later to harvest wood, or if a forest fire burns the trees down, negates permanence.

Carbon Offsets Are Only Realized at the End of Project Durations

If a carbon offset program is not carried out until the end, then we cannot reap the program’s benefits. 

One of the most popular carbon offset projects involves planting trees. It is a simple action to take and one of the most well-known ways to protect our environment. However, this is not an effective way to reduce emissions in the long term.

To offset even a fraction of our global CO2 emissions, we would have to plant AND protect a massive number of trees for decades. A newly planted tree could take upwards of 20 years to capture the amount of CO2 that a carbon offset program promises. Furthermore, there is always the risk of droughts, wildfires, tree diseases, and deforestation wiping out newly planted trees. 

If we can manage to plant and protect the trees until maturity and beyond, then and only then can the carbon sequestration benefits be realized. In reality, this is often not the case. 

Not All Carbon Offset Projects Are Effective in Reducing CO2 Emissions

Carbon offsetting programs have varying levels of effectiveness, so it can be difficult to choose a program and to ensure that the program you do choose is actually reducing emissions elsewhere. 

Aviation, renewable energy, energy efficiency, and carbon sequestration are just some areas that provide carbon offset projects. They can range anywhere from a couple of hundred tons of CO2 per program per year to thousands of tons of CO2 per program per year. They also have varying levels of effectiveness.

  • Renewable energy: The generation of energy from renewable resources (solar, wind, hydro, geothermal, biomass) rather than from fossil fuels creates a reduction in GHG emissions. They generate more energy than is used in their production, and they produce fewer emissions over their lifetime than fossil fuels produce. However, most of the available land for renewable energy carbon offset programs is located in poor countries. When powerful countries exploit this land, the native peoples are forced to compete for their basic needs, and they can even face food scarcity and eviction
  • Energy efficiency: These offset projects are designed to create products or systems that use less energy than conventional systems to perform the same task. The projects are typically implemented in developing countries and provide native people with increased energy security, job creation, improved quality of life, and environmental mitigation. However, If products are replaced too quickly, the amount of CO2 required to produce the new product would exceed the amount of CO2 saved with the new product.
  • Carbon sequestration: Defined as the long-term storage of carbon in plants, soils, geologic formations, and the ocean and realized through activities including afforestation, reforestation, improved forestry, improved agricultural practices, and revegetation. Stabilizing carbon in solid and dissolved forms prevents it from accumulating in the atmosphere. For every 1 ton of carbon that is emitted, one ton of carbon is sequestered, resulting in net-zero emissions.
  • Aviation: Roughly 40 airlines globally offer voluntary offsetting programs, where passengers pay extra money for a flight to fund projects that will reduce CO2 emissions elsewhere. 500 pounds of carbon per passenger is emitted for every 1,000 miles flown, so reducing these emissions would have positive impacts on the environment. However, even when you pay to offset your flight, the carbon from that flight is still being emitted into the atmosphere. Also, aviation offsets are perhaps the least used and least known of all carbon offsets. Companies may advertise a specific program, but it may be just for public attention.

The varying levels of effectiveness of carbon offset programs can make it difficult to choose one that actually reduces emissions. In short, the most effective offset programs are renewable energy programs, followed by energy efficiency improvements, carbon sequestration, and aviation offset programs.  

How You Can Make Carbon Offsetting Better For the Environment

If they are both additional and permanent, carbon offsets can help reduce carbon emissions to fight climate change – at least in the short term. But they can be much more effective in reducing carbon emissions if they meet certain key criteria and project standards. And this in turn makes them better for the environment.

Here are key criteria to look for in a carbon offset program:

  • A clearly defined protocol that determines which types of projects are eligible and how emission reductions will be measured
  • Independent third-party verification of compliance with the protocol
  • Registration of offsets in an offset registry, which tracks each credit with a unique serial number to ensure it is only used once 

If used correctly, carbon offsets can provide environmental, economic, and social benefits that go beyond reducing GHG emissions. They have the potential to instigate meaningful environmental change and begin to reverse some of the effects of climate change. 

Carbon offset project standards assure transparency and quality in the creation, quantification, and verification of offset projects. This way you can ensure that the project is actually reducing CO2 emissions. The following are recognized carbon offset standards:

  • Verified Carbon Standard (VCS): Considered the world’s leading voluntary GHG program, with 1700+ projects having removed 630+ million tons of CO2 from the atmosphere. Examples of projects include hydropower in Turkey, forest conservation in Peru, and landfill gas capture in China.

Choosing carbon offset projects from any of the above project standard registries helps ensure that your project is verified and that it actually reduces CO2 emissions. The more effective the carbon offset program, the better it is for the environment. However, there are still alternatives that are even better for the environment. 

What Environmentally-Friendly Alternatives for the Environment To Carbon Offsets

In the media, carbon offsets are sometimes referred to as a cure for climate change. But a more effective and environmentally-friendly approach to combating climate change is to reduce your individual carbon emissions first before relying on carbon offsets

You don’t have to make drastic changes in your lifestyle to do this. Actions that may seem small can have a big impact because those small changes add up! You can reduce your carbon footprint in three main areas of your life: household, travel, and lifestyle. 

Reduce your household footprint:

Reduce your travel footprint:

  • Walk or bike when possible: The most efficient ways of traveling are walking, bicycling, or taking the train. Using a bike instead of a car can reduce carbon emissions by 75%. These forms of transportation also provide lower levels of air pollution.

Reduce your lifestyle footprint:

  • Switch to renewable energy sources: The six most common types of renewable energy are solar, wind, hydro, tidal, geothermal, and biomass energy. They are a substitute for fossil fuels (e.g., coal and oil) that can reduce the effects of global warming by limiting global GHGs and other pollutants.
  • Recycle: Recycling uses less energy and deposits less waste in landfills. Less manufacturing and transportation energy costs means less GHG emissions generated. Less waste in landfills means less CH4 is generated.
  • Eat less meat and dairy: Meat and dairy account for 14.5% of global greenhouse gas emissions, with beef and lamb being the most carbon-intensive. Globally, we consume much more meat than is considered sustainable, and switching to a vegan or vegetarian diet could reduce emissions. 
  • Take shorter showers: Approximately 1.2 trillion gallons of water are used each year in the United States just for showering purposes, and showering takes up about 17% of residential water usage. The amount of water consumed and the energy cost of that consumption are directly related. The less water we use the less energy we use. And the less energy we use, the less of a negative impact we have on the environment.

Final Thoughts

In the short term, carbon offsets can raise awareness about the need to reduce carbon emissions and combat climate change. But overall, carbon offsets do more harm to our environment than they do good. This is because carbon offsetting is not environmentally sustainable and it does not reduce climate change. There aren’t enough offsets for all of our emissions, but even if there were, offsets have varying levels of effectiveness, they do not reduce emissions directly, they are only realized at the end of project durations, and they are often not additional and permanent. 

One way to have a positive environmental impact is to not rely on offsets and instead work on reducing your carbon emissions directly. Working to reduce emissions in your household, travel, and lifestyle can have a big impact. Carbon offsets may be seen as a stepping stone to learning how to reduce carbon emissions, but they must not be seen as a cure-all if we want to begin mitigating the serious effects of climate change.

Stay impactful,

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