FAQ's

1. Q: What are Carbon Offsets?

A: Carbon Offsets are quantifiable reductions in greenhouse gas (GHG) emissions. The reductions can be used to mitigate an organization’s Scope 1, 2 or 3 emissions in an organization’s Carbon Footprint accounting. The projects are limitless in scope and location. From the US EPA and World Resource Institute, “An offset project is “a specific activity or set of activities intended to reduce GHG emissions….the resulting emissions reductions must be real, permanent, and verified.” “Offsets can be used in addition to an organization taking actions within its own operational boundary to lower emissions. Offsets are often used for meeting voluntary commitments to lower GHG emissions where it is not feasible to lower an organization’s direct or indirect emissions.”

2. Q: What are we buying when we buy Carbon Offsets?

A: When you buy Carbon Offsets, you are buying one metric tonne (i.e., 1,000 kg or 2,205 lbs) of CO₂ equivalent emissions that have been captured, destroyed or avoided being discharged into the earth’s atmosphere. The money you spend on the Carbon Offset is necessary for the project to be successful. The offsets you are buying have already been secured and verified by a certified third party.

3. Q: What/who are the third-party project verifiers for your Carbon Offset projects?

A: Third party verifiers of our projects include (but are not limited to):

Gold Standard
American Carbon Registry
Verra (aka, Verified Carbon Standard)
Climate Action Reserve
CSA

4. Q: Can we use Carbon Offsets like we use RECs?

A: YES. The US EPA states in their published literature that Carbon Offsets can be used for offsetting Scope 2 electricity purchases – which is what RECs do (i.e., offset/mitigate Scope 2 electricity purchases). See EPA Green Power Partnership circular, “RECs and Offsets – What’s the Difference”: https://www.epa.gov/sites/default/files/2018-03/documents/gpp_guide_recs_offsets.pdf. Also, according to the EPA, the World Resource Institute and Second Nature, the reporting agency for the Presidents’ Climate Commitments, Carbon Offsets can mitigate all Scope 1, 2 & 3 emissions (including electricity purchases), in your carbon footprint accounting.

5. Q: How much have RECs increased in price over the past two years?

A: Two years ago, generic RECs cost between $0.65 and $0.90. The current price (as of January, 2022) the price for generic RECs in the voluntary is $6.00/MWh – more than a six-fold increase!

6. Q: If Carbon Offsets are $10.00 per MT CO₂e and RECs in the voluntary market are $6.00, how are Carbon Offsets cheaper?

A: Both Carbon Offsets and RECs can be used in Carbon Footprint accounting to offset/mitigate the emissions associated with the electricity being consumed by your facility. There are 26 different electricity regions in the continental US and each has a different quantity of CO₂ emissions per MWh (Mega-Watt hour) of electricity consumed. The New England and Mid-Atlantic regions (with the exception of facilities on Long Island) have less than 333 Kgs (i.e., one-third metric tonne) of CO₂ associated with the generation of one MWh of electricity. So in your carbon footprint accounting, one REC offsets a maximum of 333 kgs of CO₂ , while one Carbon Offset mitigates 1,000 kgs – or three times as much CO₂ . On a carbon accounting equivalent, the cost of mitigating one tonne of CO₂ costs $10.00 with Carbon Offsets, but the cost of mitigating on tonne of CO₂ with RECs is $18.00 (i.e., three times $6.00). The specific areas and the associated equivalents are shown below.

7. Q: What are the savings of buying Carbon Offsets over RECs for mitigating/offsetting Scope 2 electricity purchases?

A: Shown in the table below are the savings of buying Carbon Offsets over RECs for electricity purchases in various electricity grid areas in the eastern US:

Electricity	REC Price Equivalent	Savings in Buying
Area	per MTCO₂e	Carbon Offsets over REC's
______________	_______________________	______________________________
New England	$27.06	78%
NYC Metro	$23.90	58%
Long Island	$10.94	9%
Upstate NY	$56.94	82%
Mid Atlantic	$19.03	47%

Basis: REC price of $6.00 and Carbon Offset price of $10.00 (as of 1/22)

8. Q: What emissions can Carbon Offsets mitigate in our Carbon Footprint accounting?

A: Carbon Offsets can be used to offset/mitigate any Greenhouse Gas emission from your facility whether it is a Scope 1, Scope 2 or Scope 3 emission. Carbon Offsets can mitigate onsite fossil fuel burning for heating, vehicle fleet transportation, commuting, etc. Carbon Offsets are one-stop shopping for your carbon mitigation requirements.

9. Q: Can Carbon Offsets be used instead of cheaper, generic RECs in REC Arbitrage (aka, REC Swap)?

A: From the perspective of your carbon footprint accounting – most definitely, YES. Per the US EPA: “REC arbitrage occurs when RECs from one renewable electricity project are sold and replaced by less expensive RECs.…” A REC Swap is typically undertaken to take fullest advantage of higher-priced Solar RECs (SRECs), by selling them and buying cheaper generic RECs, in order to make a solar project economically viable. This maneuver not only enhances project economics, but also maintains the project’s carbon reduction goals. But the suggested replacement vehicle (i.e., generic RECs) are treated the same as Carbon Offsets with regard to your carbon footprint accounting. So why not use the less costly Carbon Offsets instead of the generic RECs; thereby, enhancing your solar project’s economics to a greater extent? You will be doing a SREC—Carbon Offset Swap!

10. Q: Which institutions use Carbon Offsets; and are Carbon Offsets preferentially used over RECs?

A: Of the over 800 institutions of higher education that have signed the Presidents’ Climate Commitment, only 10 have announced carbon neutrality – and all 10 utilize Carbon Offsets. In fact, one school uses Carbon Offsets to mitigate all of their Scope 1, 2 & 3 emissions (i.e., they use Carbon Offsets rather than RECs for offsetting their Scope 2 electricity purchases). On average, the 10 schools mitigate four times as much carbon with Carbon Offsets as they do with RECs.

11. Q: Because Carbon Offsets are project-based, are there other benefits to purchasing Carbon Offsets over RECs?

A: Many Carbon Offset projects address other societal shortcomings such as social and environmental justice inequities. In fact, many of the 10 schools that have announced carbon neutrality combine their social and environmental justice goals with their carbon reduction strategies when purchasing Carbon Offsets. One of our favorite projects to support is Efficient Wood Cookstoves in Rwanda.

12. Q: Are Carbon Offsets useful in reducing methane emissions?

A: YES. COP 26 brought to light the importance of reducing methane emissions as methane’s 20-year GWP (Global Warming Potential) is 84 to 87 times greater than CO₂ (Note: Methane emissions currently rivals human CO₂ emissions for global warming impact). Because Carbon Offsets are project based, and are not limited to only renewable energy generation, projects have been developed that reduce methane emissions. There are several methane-mitigation projects that are less than half the cost of RECs on an equivalent carbon accounting basis.

13. Q: RECs vs Carbon Offsets: Which to buy?

A: RECs came to fruition over 25 years ago. They were essential in raising the public’s awareness of the benefits of renewable energy. But RECs don’t stand the test of additionality. Despite what we are led to believe, there is no requirement for the money spent on RECs to be used for new renewable energy projects being built. A couple of years ago, RECs were an insignificant cost – but no more. The voluntary REC market is a $500 million per year business. Re-directing these funds to projects that actually reduce atmospheric GHGs (i.e., Carbon Offset projects) would have an enormous benefit to combating global climate change. Promoting the sale of RECs, which do little-to-nothing for the environment, is not the best way to confront man-induced global climate change.

14. Q: Haven’t there been some problems of late with the efficacy of Carbon Offsets in actually reducing GHG emissions?

A: While all Carbon Offset projects have to prove that the project being financed reduces carbon emissions, there have been some questionable projects offered by others. For example, not cutting down a stand of trees that weren’t going to be harvested does nothing to reduce global warming. We constantly monitor the projects we offer to make sure that they make sense and are easy to implement and scale. The Efficient Wood Cookstoves in Rwanda project is a good example – additionality and resilience has been proven as 90+% of the cookstoves distributed are still in use five years after project implementation