December 17, 2009
30% of Carbon Offset Projects Amount to Hot Air
Nearly a third of carbon offset projects don’t live up to their stated expectations, according to recent analysis from Point Carbon, reports Business Week.
The new report from Point Carbon shows that three out of 10 projects registered under the Clean Development Mechanism never actually get approval to be sell carbon credits, Business Week reports. Only about 45 percent of registered landfill and other waste projects, including those that capture methane, will actually create carbon credits, according to the analysis.
Another recent report, “Subprime Carbon,” by Friends of the Earth highlights the pitfalls of carbon offsetting. The report asserts that dubious carbon credits will lead to an economic boom-and-bust cycle.
Wall Street wants to forge ahead in carbon trading, but critics assert that Wall Street’s involvement will create problems, reports The Globe and Mail.
Michelle Chan of the Green Investments Project at Friends of the Earth said that regulations “can’t keep up” with investment bank schemes. Friends of the Earth is among groups pressuring Congress to put limits on how banks can be involved in carbon trading.
Goldman Sachs estimates the U.S. carbon trading market to be potentially worth $130 million a year, reports Newsweek.
Yet the voluntary carbon trading market continues to move forward.
Just this week, San Francisco-based Wildlife Works Inc. launched a forest carbon offset project located in the Rukinga Wildlife Sanctuary in Kenya.
To view an NPR video news report about carbon trading, click here.
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Reader Comments
Only 30%? Come on, the truth is much closer to 100%.
.
Jimmy34 | December 17th, 2009
Once again a fantastic piece of misreporting. So if a carbon credit project does not live up to expectations what does this actually mean? It means that the initial investors lose their money as no carbon credits can be sold – it does not mean that those purchasing credits lose money because the projects never generate credits.
I do not work for an investment bank but I do work for a carbon management company and part (and only a part) of what we do is to source high quality credits for our clients. These work – carbon projects are good! Why if a company puts up a wind turbine, invests in energy efficiency, installs a micro hydro in the UK are they lauded as heroes …. AND when they do it in Africa are they demonised?
In addition to trying to disrupt Copenhagen, these guys are bang out of line – WWF and Forum for the Future support offsetting AND everyone clearly understands that carbon markets are not THE solution – just one tool in our armoury. Look FoE clearly hates investment bankers and the concept of profit but we need finance to make this work and to get finance we need incentives to encourage people to participate. Otherwise the only thing we can use to encourage the dramatic change required is influence (clearly not working as evidenced by recent surveys showing that the public simply does not believe climate change is happening) or sticks to beat everyone with (which again will not work).
Lets make the system work properly – and lets educate consumers and corporates to help them pick the good carbon credit schemes (Gold Standard, Voluntary Carbon Standard and CDM) from the also rans. Look in every market there are differing levels of quality but you dont stop buying apples because of one bad apple.
Finally – to all the critics – how many of you have actually been to an offset project – how many of you actually really understand and know how it works.
James | December 18th, 2009