The heightened level of concern surrounding climate change has given rise to the concept of carbon neutrality. An individual, organization or event becomes carbon neutral if it eliminates all direct greenhouse gas (GHG) emissions associated with it, or reduces them to the extent possible and accounts for any remaining direct emissions through the purchase of offset credits.

A declaration to become carbon neutral creates a lot of excitement, and it seems that some organizations have rushed headlong into this, perhaps without stopping to consider the approach they should take. There are a few questions organizations should ask themselves: What are our emissions? Where do they come from? What opportunities are there to reduce our emissions? How much will it cost to offset remaining emissions? What is an appropriate, obtainable GHG goal?

An effective GHG emissions management strategy should use these steps as a guideline:

• Quantify emissions in a GHG inventory
• Identify reduction opportunities
• Evaluate offset offerings
• Determine a GHG goal
• Implement reduction projects and offset purchases to meet your goal

The first step is to quantify your emissions in a GHG inventory, also known as a carbon footprint. This crucial first step will provide an understanding of where you stand. It will tell you the total volume of your emissions, and give you a breakdown of your emissions by area or region and by source.

With this knowledge you can identify and assess reduction opportunities. Just like ‘reduce’ comes before ‘recycle’, emission reductions should always be considered before offsetting. Reduction projects may range from awareness programs to operational changes to capital projects. A basic assessment of the cost, required effort and emission reduction benefits should be conducted on each. Energy efficiency projects will provide a return on investment, and the emission reductions may allow you to consider a longer payback period than you normally would.

Once you have some handle on how much you might be able to reduce your emissions internally, it’s time to consider offsets. The use of carbon offset credits has been compared to the practice of giving papal indulgences, exchanging payment for forgiveness of sins. The analogy stems from the idea that an organization can pay for polluting, guilt-free. Critics have two main concerns with offsets: you aren’t changing your actions by buying a carbon offset, and the offset may not represent a true emission reduction.

While these may both be valid concerns in certain situations, carbon offsets definitely can provide an easier transition to the fabled “low carbon economy”. Right now it’s often easier to buy an offset than to reduce emissions yourself. Purchasing offsets may cost less, and will generally require less effort. Offsets are economically efficient in that they offer the opportunity to pick the lowest hanging fruit first in terms of GHG emission reductions.

For any organization attempting to establish a reputation as an environmentally responsible entity, taking some internal action may be a necessary component even if purchasing offset credits would be a less expensive way to go. Internal reductions are a more compelling demonstration of environmental commitment than purchasing offsets and they start the transition towards new ways of doing business. As energy prices go up, and as new technologies develop, more internal opportunities will become viable, and the need to offset will shrink.

A carbon offset, when it is created properly, is a real product with actual environmental benefits. However, it should be recognized that there are risks associated with choosing to purchase offset credits instead of eliminating emissions yourself:

• Is the offset real – was something actually done to reduce or remove GHGs?
• Is it permanent – will the project endure, or is it possible that the emissions removed from the atmosphere could be re-released?
• Is it additional – did your investment actually result in the creation of the emissions reduction or removal, or was it something that would have happened anyway?
• Was there any leakage – did the project inadvertently cause an increase in emissions somewhere else?
• Is the project sustainable – does it have any other environmental or social costs or benefits?

Any environmental credit earned by purchasing offset credits could be quickly undone should the offsets be subsequently found to be invalid.

A number of standards have been established to ensure the quality of offset credits, including the Gold Standard and the Voluntary Carbon Standard. Purchasing offsets that are independently verified against such standards goes a long way toward ensuring that the issues outlined above have been suitably addressed. As with any purchase, the rule of thumb is buyer beware.

Once the evaluation of potential reductions and offset offerings is complete, it is possible to set a GHG reduction goal. Ideally, the goal should align with what your organization can achieve if it ambitiously pursues reduction projects, and offsets remaining emissions to the extent you can afford. It may be a goal of becoming carbon neutral, or it may be a more modest goal of reducing and offsetting emissions from select sources, or by a set amount. Once your goal is set, it’s time to initiate your emission reductions projects and offset purchases.

Following a logical process to arrive at your GHG reduction goal will ensure that your goal makes sense for your organization. Having a goal and a plan that includes both internal reductions and offsets will demonstrate your sincere commitment to making a difference in the fight against climate change.