Why ‘Carbon Offsets’ Don’t Do All That They Promise

Procter & Gamble Co. plans to spend $100 million on carbon offsets to neutralize a small proportion of its greenhouse gas emissions. Another consumer products giant, Unilever Plc, is foregoing offsets, at least for now. Perhaps surprisingly, it’s Unilever’s course that’s more in line with the urgings of scientists and environmental activists. That’s because while offsets sound appealing and have drawn investments from companies including Disney, Lyft, Delta Airlines and Apple, there’s a fierce debate over whether they actually deliver on their paper promises.

A carbon offset is a promissory note to remove a certain amount of greenhouse gases from the air to compensate for emissions occurring elsewhere. The goal is to protect the atmosphere while allowing economic activity to continue. The general term “offset” was popularized long before climate change took center stage: The Clean Air Act of 1970, passed by Congress in 1970, stated that high-volume emissions would only be permissible if the polluter reduced emissions in other locations. While offsets have historically centered around the planting or protection of trees, which absorb carbon dioxide while growing, the use of the term has since been applied to a variety of sustainable efforts globally.