{"id":7496,"date":"2021-05-20T20:42:05","date_gmt":"2021-05-20T19:42:05","guid":{"rendered":"https:\/\/www.boosst.financial\/insights\/?p=7496"},"modified":"2021-06-30T12:38:49","modified_gmt":"2021-06-30T11:38:49","slug":"you-asked-carbon-offsetting","status":"publish","type":"post","link":"https:\/\/www.boosst.financial\/insights\/you-asked-carbon-offsetting\/","title":{"rendered":"You Asked: Carbon Offsetting"},"content":{"rendered":"<blockquote>\n<h5 style=\"text-align: center;\"><span style=\"color: #db409a;\">New for 2021, \u2018You Asked\u2019 is the latest series of insights from the boosst team.\u00a0<\/span><\/h5>\n<h5 style=\"text-align: center;\"><span style=\"color: #2b2155;\">You, our clients, have a wonderful ability to ask relevant and thought-provoking questions&#8230; which are often (but not always!) related to financial planning.\u00a0<\/span><span style=\"color: #2b2155;\">boosst is a trusted source of knowledge and independent advice, so it makes sense that you come to us with a broad range of questions &#8211; which can vary from &#8216;Which car should I buy?&#8221; to &#8220;What&#8217;s the best way to teach our children about money?&#8221;. <\/span><\/h5>\n<h5 style=\"text-align: center;\"><span style=\"color: #db409a;\">This \u2018You Asked\u2019 post is shared by Josh.<\/span><\/h5>\n<\/blockquote>\n<h4><strong><span style=\"color: #db409a;\">Carbon Offsetting <\/span><\/strong><\/h4>\n<p>We have been asked by a few clients in 2021 to explain a little more about what Carbon Offsetting is, how it works &#8211; and if it is a good use of money!\u00a0Maybe this question should come as no surprise, we have seen over 55% of our Individual clients opt to use our sustainability-minded ESG portfolios &#8211; indicating to us that this is a topic you care about! Considering whether to carbon offset requires you to think about your lifestyle, the impact of your lifestyle decisions and deciding whether to take action to offset the decisions\/lifestyle you choose. Put like this, there are some clear links to Financial Planning!<\/p>\n<p>&nbsp;<\/p>\n<blockquote>\n<p style=\"text-align: center;\"><em><span style=\"color: #db409a;\">&#8220;We are the first generation to feel the effect of climate change and the last generation who can do something about it.&#8221; <\/span><\/em><\/p>\n<\/blockquote>\n<p style=\"text-align: center;\"><span style=\"color: #2b2155;\"><b>Barack Obama, 2014\u00a0<\/b><\/span><\/p>\n<p>&nbsp;<\/p>\n<h5><\/h5>\n<h5><strong><span style=\"color: #db409a;\">Isn\u2019t it better to just not create the carbon in the first place?<\/span><\/strong><\/h5>\n<p><strong><span style=\"color: #db409a;\">Simple answer:<\/span> <span style=\"color: #2b2155;\">Yes.<\/span><\/strong><\/p>\n<p>Offsetting your carbon is a way of paying for others to reduce emissions or absorb CO2 to compensate for your own emissions. For example, by planting trees to suck carbon out of the atmosphere as they grow, or by delivering energy-efficient cooking stoves to communities in developing countries. A much better solution is of course to directly reduce your own emissions in the first place.<span class=\"Apple-converted-space\">\u00a0<\/span><\/p>\n<p>&nbsp;<\/p>\n<p><strong><span style=\"color: #db409a;\">The reality:<\/span> <span style=\"color: #2b2155;\">It\u2019s not quite that straightforward.<span class=\"Apple-converted-space\">\u00a0<\/span><\/span><\/strong><\/p>\n<p>If you wish to live a lifestyle which is closer to carbon neutral, then the most influential lifestyle changes you can make are giving up long haul travel and meat. Realistically, this isn\u2019t an easy sell to a generation which has aspirations of exotic beaches and a diet of fish &amp; chips and roast dinners! For those not quite ready to give up their bucket-list-trips and Sunday morning bacon sandwich, here are some simpler ways to reduce your carbon footprint:<\/p>\n<ul>\n<li>Keep your car\u2019s tyres inflated to reduce drag and focus on driving more efficiently<\/li>\n<li>Reduce food waste (Brits threw away \u00a310Billion of food last year!)<\/li>\n<li>Choose a renewable energy provider for your home and use a smart system to adjust your heating settings to suit occupancy<\/li>\n<li>Reduce heat loss from your home by improving your home insulation<\/li>\n<li>Take note of the energy efficiency ratings next time you are buying white goods<\/li>\n<li>Avoid fast fashion<span class=\"Apple-converted-space\">\u00a0<\/span><\/li>\n<li>Unplug idle home electronics<\/li>\n<li>Eat seasonal food and local produce<\/li>\n<\/ul>\n<p>Of the eight options listed above, seven of them will actually reduce your monthly expenditure as well as your carbon footprint. The exception is of course \u2018fast fashion\u2019 &#8211; everything has a cost and in this case, the price paid by the consumer is not representative of the \u2018true cost\u2019 to produce the item. The \u2018true cost\u2019 can only be understood when you look deeper at the poor labour standards, material sourcing and measure the negative environmental impact of the industry <strong><span style=\"color: #02bad8;\">(1)<\/span><\/strong>.<\/p>\n<p>&nbsp;<\/p>\n<h5><span style=\"color: #db409a;\"><b>Civilisation as we know it simply isn\u2019t ready to be carbon-free.<span class=\"Apple-converted-space\">\u00a0<\/span><\/b><\/span><\/h5>\n<p>We\u2019re headed in the right direction &#8211; but a carbon neutral lifestyle remains a good distance away. We use planes to go on holiday, we have a road network which relies on cars and the everyday use of plastic means that we are wedded to fossil fuels for a good while longer. Hydroflex trains offer the hope of a hydrogen powered carbon-free train service across the UK <span style=\"color: #02bad8;\"><strong>(2)<\/strong> <\/span>and progress continues to be made with electric aeroplanes but momentum remains slow and wholesale change is still decades away <span style=\"color: #02bad8;\"><strong>(3)<\/strong><\/span> (the key issue is weight &#8211; batteries are far less energy dense than kerosene!).<\/p>\n<p>&nbsp;<\/p>\n<blockquote>\n<p style=\"text-align: center;\"><span style=\"color: #db409a;\"><i>\u201cWe do not inherit the earth from our ancestors. We borrow it from our children.\u201d<\/i><\/span><\/p>\n<\/blockquote>\n<p style=\"text-align: center;\"><span style=\"color: #2b2155;\"><strong>Native American Proverb<\/strong><\/span><\/p>\n<p>&nbsp;<\/p>\n<h5><span style=\"color: #db409a;\"><b>Can carbon offsetting help us to fill the gap?<\/b><\/span><\/h5>\n<p><strong><span style=\"color: #db409a;\">Simple answer:<\/span> <span style=\"color: #2b2155;\">Yes.<\/span><\/strong><\/p>\n<p><strong><span style=\"color: #db409a;\">The reality:<\/span> <span style=\"color: #2b2155;\">It\u2019s not quite that straightforward \u00a0(Sounds familiar!).<\/span><\/strong><\/p>\n<p>After you\u2019ve made efforts to shrink your personal carbon footprint, it\u2019s time to consider buying carbon offsets.<\/p>\n<p>You may have already been given the opportunity to buy carbon credits. Most airlines offer the option to buy offsets from third-party sellers to counterbalance the flight you are booking. This is quite convenient as long-haul flights are often the largest single contributor to the overall carbon footprint of most people who live in developed nations. Should you consider buying carbon offsets? Yes, but only selectively. Poor-quality carbon offsetting options were once common as the industry emerged, so you first need to do some legwork to ensure authenticity.<\/p>\n<p>&nbsp;<\/p>\n<p><span style=\"color: #2b2155;\"><strong>The National Resources Defense Counsel (NRDC) offers this helpful hypothetical example:<\/strong><\/span><\/p>\n<p><span style=\"color: #2b2155;\"><i>An offset seller may give your money to a landowner in the Amazon who promises to leave his trees standing to maximise carbon sequestration.<\/i><\/span><\/p>\n<p><span style=\"color: #2b2155;\"><i>The offset seller should make several guarantees in this transaction. First, that the offsets are\u00a0<\/i><b><i>real<\/i><\/b><i>\u2014that there\u2019s an actual landowner who owns actual land with actual trees. This guarantee shouldn\u2019t be necessary, but unfortunately there have been cases of groups collecting money for offset projects that don\u2019t yet exist.\u00a0Relatedly, the offset should be\u00a0<\/i><b><i>verified\u00a0<\/i><\/b><i>and\u00a0<\/i><b><i>enforceable<\/i><\/b><i>\u2014a third party should have laid eyes on the trees, and there must be a mechanism for penalising the landowner if he doesn\u2019t follow through. The offset should also be\u00a0<\/i><b><i>permanent<\/i><\/b><i>. If the guy who gets your money can burn his trees to the ground six months later, your money will have been wasted. Finally, the offset must be\u00a0<\/i><b><i>additional<\/i><\/b><i>. This is the trickiest issue with carbon offsets. What if the Amazonian landowner never had any intention of clear-cutting his land in the first place? Then your purchase would be a gift rather than an offset. The landowner would be taking advantage of the offset system to collect a windfall for doing exactly what he would have done anyway. Your transaction would have no effect on the amount of carbon in the atmosphere. There is also the issue of\u00a0<\/i><b><i>leakage<\/i><\/b><i>. Let\u2019s say your money prevented the Amazonian landowner from selling his plot to a logging company. That\u2019s great, but what if the logging company simply bought the plot next door? That\u2019s leakage. Your offset dollars shifted deforestation rather than preventing it.<\/i><\/span><\/p>\n<p>&nbsp;<\/p>\n<p>Whilst it is &#8216;normal&#8217; for large corporations like Google to send employees out to carbon offset projects to have a poke around and check it\u2019s 100% legit (<strong><span style=\"color: #02bad8;\">(4)<\/span> <\/strong>yes, they actually do this!) and scale enables Apple to invest $200,000,000 in their newly launched &#8216;Restore Fund&#8217; <strong><span style=\"color: #02bad8;\">(5)<\/span><\/strong>\u2026 it is not really realistic to be able to check carbon offset projects yourself as a consumer.<span class=\"Apple-converted-space\">\u00a0<\/span><\/p>\n<h5><\/h5>\n<p>&nbsp;<\/p>\n<h5><strong><span style=\"color: #db409a;\">So where does this leave us?&#8230;<\/span><\/strong><\/h5>\n<p>So far, we have found that carbon offsets do not offer a complete solution and prevention in the first instance is a much better solution. After you have taken some of the steps above to reduce your carbon footprint, your carbon lifestyle is largely in the hands of the legislators and city planners to be improved. Most of us still rely upon cars to get to work and flights to broaden our horizons. If you want to achieve a net zero carbon footprint without giving up these luxuries, carbon offsetting offers a very valid option. <span class=\"Apple-converted-space\">If\u00a0you&#8217;re ready to take the next step, here is your two step action plan to offsetting:<\/span><\/p>\n<p><span style=\"color: #db409a;\"><strong>Step 1 &#8211; Calculate your carbon offset target<\/strong><\/span><\/p>\n<p><span class=\"Apple-converted-space\">The lifestyle of the average British citizen produces around 1.4 tonnes of\u00a0carbon dioxide per month, or 16.8 tonnes per year. I was finding this hard to visualise &#8211; so\u00a0a little more digging highlighted that 1\u00a0tonne of CO2 is equivalent to a return trip between London and New York by plane. In terms of volume, 1 tonne of CO2 represents a cube of gas the size of a three-storey building.\u00a0<\/span>In order to successfully offset your carbon, you first need a good idea of your carbon footprint. There are a number of great calculators available which give evidence-based outcomes based on your inputs. Some are super detailed but I quite liked the more straightforward \u2018Footprint Calculator\u2019 offered by WWF, as it is easy to understand and provides a personalised calculation within minutes: <a href=\"https:\/\/footprint.wwf.org.uk\/#\/\">LINK.<\/a><\/p>\n<p><strong><span style=\"color: #db409a;\">Step 2 &#8211; Find a reputable and authentic scheme for carbon offsetting<\/span><\/strong><\/p>\n<p>Gold Standard (<a href=\"http:\/\/www.goldstandard.org\" target=\"_blank\" rel=\"noopener\">LINK<\/a>) is the certified body for carbon offset projects and offers a marketplace of projects which meet the required standards: <a href=\"https:\/\/marketplace.goldstandard.org\/collections\/projects\" target=\"_blank\" rel=\"noopener\">LINK<\/a>. You will quickly notice that the majority of projects focus on quick wins, such as fuel efficient stoves for developing countries, which can provide an instant carbon benefit instead of planting trees which will take years, decades even, for a sapling to mature into a carbon-hungry oak. From the projects currently available, you can expect to pay between $10 and $50 per tonne of CO2, depending on the type of project you choose. (If selecting low-cost projects, an average British citizen could fully offset their personal carbon footprint for around \u00a3140 per annum).<\/p>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n<h5><span style=\"color: #db409a;\"><strong>Is carbon offsetting a fix-all solution?<\/strong><\/span><\/h5>\n<p>Well, put simply &#8211; no. Particularly at a large scale, offsetting has some fairly significant limitations. For example; reforestation is the most common form of offsetting and there are around 500 Mega-hectares of previously-forested and currently unused land that could be available for reforestation without necessarily impacting food or biodiversity <span style=\"color: #02bad8;\"><strong>(6)<\/strong><\/span>. This could remove 3,700 Mt\/year of CO2. To put this in perspective, Shell has proposed planting 50 Mega-hectares of forest to offset its own emissions &#8211; doing so could thus effectively claim one tenth of the sustainably available total for just one company.<span class=\"Apple-converted-space\">\u00a0 <\/span>For big corporations, this leads us to the conclusion that carbon offsetting should only be used to offset those emissions that are hardest and most expensive to reduce.<\/p>\n<p>Offsetting certainly has a place for Individuals like you and I who want to reduce our net carbon footprint <strong>however<\/strong>\u00a0it is not a fix-all solution &#8211; and this is especially true for large businesses &#8211; who we are all relying upon to find better and more innovative ways to reduce the carbon output of their products and services.<\/p>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n<h5><strong><span style=\"color: #db409a;\">Josh&#8217;s closing thoughts<\/span><\/strong><\/h5>\n<p>If you&#8217;ve read this far, I hope you found this &#8216;You Asked&#8217; insight informative! Until now, I haven&#8217;t used carbon offsetting &#8211; but with a better understanding of how it works, how to calculate my personal impact and where to look for authentic offsetting opportunities&#8230; I think we can see where this is heading!\u00a0If this Insight spurs you into taking action, I would love to hear from you!<\/p>\n<p>&nbsp;<\/p>\n<h5 style=\"text-align: center;\"><span style=\"color: #2b2155;\">Do you have a burning question? If there is something you want to learn more about, or a topic you would love us to dig into, just let us know!\u00a0<\/span><\/h5>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n<h5><span style=\"color: #db409a;\">References<\/span><\/h5>\n<p><strong><span style=\"color: #02bad8;\">(1)<\/span><\/strong> Stacey Dooley\u2019s \u2018Fashion\u2019s Dirty Secrets\u2019 documentary is a great introduction to the impact of fast fashion, you can find it on iPlayer<\/p>\n<p><span style=\"color: #02bad8;\"><strong>(2)<\/strong><\/span> <a href=\"https:\/\/www.bbc.com\/future\/article\/20200227-how-hydrogen-powered-trains-can-tackle-climate-change\">https:\/\/www.bbc.com\/future\/article\/20200227-how-hydrogen-powered-trains-can-tackle-climate-change<\/a><\/p>\n<p><span style=\"color: #02bad8;\"><strong>(3)<\/strong><\/span> <a href=\"https:\/\/www.wired.com\/2017\/05\/electric-airplanes-2\/\">https:\/\/www.wired.com\/2017\/05\/electric-airplanes-2\/<\/a><span class=\"Apple-converted-space\">\u00a0<\/span><\/p>\n<p><span style=\"color: #02bad8;\"><strong>(4)<\/strong><\/span> <a href=\"https:\/\/static.googleusercontent.com\/media\/www.google.com\/en\/\/green\/pdfs\/google-carbon-offsets.pdf\">https:\/\/static.googleusercontent.com\/media\/www.google.com\/en\/\/green\/pdfs\/google-carbon-offsets.pdf<\/a><span class=\"Apple-converted-space\">\u00a0<\/span><\/p>\n<p><strong><span style=\"color: #02bad8;\">(5)<\/span><\/strong> <a href=\"https:\/\/www.apple.com\/environment\/pdf\/Apple_Environmental_Progress_Report_2021.pdf\">https:\/\/www.apple.com\/environment\/pdf\/Apple_Environmental_Progress_Report_2021.pdf<\/a><span class=\"Apple-converted-space\">\u00a0<\/span><\/p>\n<p><span style=\"color: #02bad8;\"><strong>(6)<\/strong><\/span> <a href=\"https:\/\/www.greenpeace.org.uk\/wp-content\/uploads\/2021\/01\/Net-Expectations-Greenpeace-CDR-briefing.pdf\">https:\/\/www.greenpeace.org.uk\/wp-content\/uploads\/2021\/01\/Net-Expectations-Greenpeace-CDR-briefing.pdf<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>New for 2021, \u2018You Asked\u2019 is the latest series of insights from the boosst team.\u00a0 You, our clients, have a wonderful ability to ask relevant and thought-provoking questions&#8230; which are&#8230;<\/p>\n","protected":false},"author":2,"featured_media":7522,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[110],"tags":[44,39],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.boosst.financial\/insights\/wp-json\/wp\/v2\/posts\/7496"}],"collection":[{"href":"https:\/\/www.boosst.financial\/insights\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.boosst.financial\/insights\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.boosst.financial\/insights\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.boosst.financial\/insights\/wp-json\/wp\/v2\/comments?post=7496"}],"version-history":[{"count":17,"href":"https:\/\/www.boosst.financial\/insights\/wp-json\/wp\/v2\/posts\/7496\/revisions"}],"predecessor-version":[{"id":7533,"href":"https:\/\/www.boosst.financial\/insights\/wp-json\/wp\/v2\/posts\/7496\/revisions\/7533"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.boosst.financial\/insights\/wp-json\/wp\/v2\/media\/7522"}],"wp:attachment":[{"href":"https:\/\/www.boosst.financial\/insights\/wp-json\/wp\/v2\/media?parent=7496"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.boosst.financial\/insights\/wp-json\/wp\/v2\/categories?post=7496"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.boosst.financial\/insights\/wp-json\/wp\/v2\/tags?post=7496"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}