Carbon offsets and renewable energy certificates (RECs) are promoted as tools for reducing carbon footprints, yet recent evidence cautions against their effectiveness. Concerns focus on legitimacy and moral hazard associated with purchasing these credits. Research indicates that a high percentage of carbon offsets do not deliver real emissions reductions. For instance, a 2024 study revealed that 87% of offsets purchased by large corporations pose a high risk of ineffectiveness. Moreover, 94% of scrutinized forest carbon offsets were found to be non-performing.
Recent research has exposed systemic problems in the voluntary carbon market. A 2024 study in Nature Communications examining the twenty largest corporate buyers found that 87% of purchased offsets carry a high risk of not providing real and additional emissions reductions.
Concerns about both RECs and offsets revolve around two major issues: moral hazard and legitimacy. Carbon offsets are particularly criticized for their failure to deliver consistent CO2 reduction results.
Many carbon offset programs are not legitimately sustainable, as evidence suggests that while RECs and offsets are theoretically beneficial, they face intensifying criticism and controversy.
An unpublished study cited by CarbonBrief suggests that only 12% of offsets sold result in 'real emissions reductions', indicating a significant gap in expected versus actual outcomes.
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