= the promise = By now you may have heard of "carbon offsetting". Carbon offsetting is the use of a powerful new tool where you can purchase Certified(TM) carbon credits. An industry that generates energy (such as, but not limited to, electric power) without carbon may, in effect, trade its right to call their energy carbon-emission-free. In theory, if you're allowed to trade carbon credits (actually, carbon-emission credits, because carbon sequestering would be a credit as well), a use of carbon that is difficult to fix can buy an equal amount of carbon emission displacement, leveraging the economies of scale in, say, mass wind turbine deployment. Sounds like a silver bullet, right? = the problems = The main problem with carbon credits is that the credit applies to the amount of CO2 released into the air that has been "avoided", however, those who purchase carbon credits for the purpose of carbon offsetting don't differentiate different types and uses of carbon. For example, let's say you want to fly to Thailand. The amount of carbon in the air can be "offset" with a purchase of a certain amount of wind energy production. that wind energy production will be sold to the grid as non-renewable energy. That's problem number one -- you have to have non-renewable energy purchasers to make the system viable who don't care that they just subsidized reducing your guilt-quotient. This applies to all uses of the credit system. I guess to enable you guys to feel better about yourself, I shouldn't buy the credits on my electricity bill. Now, let's say you tell others you've offset the carbon from the airplane. It cost like ten bucks to do this. The fuel costs are actually closer to $150. There's a 15:1 differential in this case between _market_ cost of the two types of carbon. Not all uses of carbon are the same, and some are just more expensive than others. This is a way to remove the guilt of a really expensive carbon at a cost less than the cost to actually display use of that very carbon use. That's just market cost, not even cost-to-replace. The real question should be, even if we assume that problem number one is no big deal for you, is did you actually offset the same type of carbon. Did you pay for somebody's flight to Thailand on all renewable carbon? Then there's the third issue. Is the carbon a net carbon or a total carbon reduction? How much carbon was used to build the wind turbines? That has to be taken into account, because if you don't, then you're using extra carbon just to create extra wind farms to handle your carbon credit purchase. The amortized, full-cost of the carbon must be considered (many places to this, but the FTC is actually now beginning to step into the picture to see if this actually takes place). There's a fourth issue as well -- that it has ponzi effects. Let's say the entire world desires to offset its carbon and the entire electric grid has plenty of power all powered via renewable energy. Because of the difference of "types" of carbon I mentioned earlier, now nobody can afford the carbon credits because they've now gone way up in price, since they aren't available anymore. The windmill industry is making less and less money off of the turbines it has and is being forced to build new ones just to offset a continuing source of pollution. So early adopters get cheap carbon credits and late adopters have to pay a larger amount for carbon credits unless we find more and more ways to offset carbon that end up being cheaper. Then there's the fifth problem -- until carbon credits are actually classed by type of carbon, we won't be able to ever solve the problem of airplane travel by electricity from a windmill because there are other cheaper ways of doing carbon offsets. Until carbon credit costs start approaching the cost of eliminating the native carbon, nobody will solve that problem, especially if oil just happened to be a very efficient use of that carbon. And Sixthly, let's say you want to be direct about it and you'll promise to directly invest in a company that is going to work on solving the particular problem carbon that you're using: Jet Fuel. How do you price that? Early adopter price? Late adopter price? In theory, the late adopter price. But what will actually happen is that the company will charge the same rate down the road as it wants to make as much profit as the market will bear, so you're really not reducing the price for anybody down the road. By them using the alternative, they've also justified (via the company's profit) the fact that you in the past used carbon. Maybe that one-time cost is worth it, but all it means is you've transferred the guilt to another party even when the technology is available. i.e. you've really offset nothing. Seventhly, there's the problem that the accounting might require plastic components that aren't ever converted to CO2, but they still are extracted, pollute, and end up in landfills. Is that carbon counted? Maybe it's counted "differently". What about other forms of pollution that aren't carbon, let's say it releases a certain amount of arsenic into a stream while they make the wind turbines, or they use mercury cf's for lighting. The offset creates an entire industry around it that potentially pollutes. Are we only going to count CO2 emissions? Eighthly, what if we do carbon sequestering -- you'll pay the cost of putting the carbon into the ground that you put into the air. Better, but how sustainable is that? Are you putting it into the ground (or sequestering) in a form identical to the type used such that it's extractable again with a cost less than or equal to the original extraction cost (considering all environmental costs of extraction too)? If not, we'll end up running out of a useful type of carbon quickly only to have a surplus of sequestered carbon that's perhaps not as useful as the old carbon and you've not properly accounted for that cost Ninthly, so yeah, what about tree planting as a sequestering method? What was there before the tree, a field that was likely sequestering just as much carbon? How do you know, did you check? Is somebody going to come along and cut it again for the fuel or wood? How do you track that wood to the end of its life so that never gets incinerated? Al Gore at the end of all of his speeches says everybody in this room can be carbon neutral today if they just go to his website and buy some carbon credits for their entire life. I looked at his credits and they look to be of the invest-then-sell-as-non-renewable type, which have all the problems mentioned here. Whatever. If we want to support carbon credits, we need to be realistic about what we're paying for, and then 50% of the world still needs to not care about polluting for it to work so they'll buy your pollution guilt. We have, for eaxmple Volkswagen selling carbon credits for the first year or 15k miles of the car, and optionally more. People who would otherwise ride their bike might be duped into buying and driving a Golf thinking they're not really contributing to global warming. Carbon credits, as they exist today, are thus not an actual solution to any real problem. They just transfer carbon-guilt to somebody else who just doesn't care about the problem. = the solutions = Reduce your use of carbon directly. Pre-invest in technologies where you aren't using it as a guilt-transfer. Develop sequestering technologies that are imminently usable in hard-carbon uses. Convert hard-carbon uses into non-carbon-requiring technologies such as electricity, then use renewable energy directly to power your electricity. Pay for windmills that directly replace your local coal power plant and buy that power (so that you're not leveraging regional wind differentials.) There are so many better ways of handling the issue than carbon credits, that the only reason they are being heavily popularized is due to one of the problems listed above.