Carbon offsetting 

Carbon offsetting has been around for some time now, and on the face of it, seems to be a reasonable way of reconciling unavoidable carbon emissions both for companies and individuals. Offsetting works by planting trees, investing in various green projects etc in order to either absorb the carbon produced (in the case of trees) or by simply investing in projects that reduce carbon emissions in other ways. One example company that provides this type of service is Carbon Offsets ltd. They invest on your behalf in everything from renewable energy projects to projects that claim to prevent the deforestation of existing resource.

Seems straightforward enough, but as ever, it's not. Over the last year or two there have been more than a few negative stories surrounding offsetting, to the extent that the Federal Trade Commission is investigating the validity of some schemes. The problems with offsetting as follows:

Planting trees will only result in carbon absorption for the life of the tree. At some point it will die off and release the carbon back into the atmosphere. So tree planting simply cannot offset sustained overproduction.

Carbon credits have also come under fire for funding projects that would have gone ahead anyway. Companies in the developing world are being paid retrospectively for energy efficiency projects that just made good business sense and have already been deployed. Not quite what we had in mind?

Overall, I would say that there's just too much scope for cheating with offsetting, so I set off in search of an alternative and didn't have to look too hard.

Carbon Retirement

Like all my favorite ideas, Carbon Retirement is conceptually as simple as it gets. Rather than offsetting carbon emissions, you just retire permits from the EU Emissions Trading Scheme (ETS). This scheme issues permits to all the largest polluters, industries such as iron and steel production and power generation using fossil fuels.  The allowances allocated in the EU ETS are called EU Emission Allowances, or EUAs. One EUA represents the right to release one ton of carbon dioxide into the atmosphere.

So, a company may decide to reduce its emissions by using a cleaner but more expensive type of fuel. Under the EU ETS this may save them money, as they will now need to buy fewer allowances to cover their emissions. If the fuel is so clean that it reduces the company's emissions below their allocation, they can sell the extra allowances to other companies that haven't been able to reduce their emissions enough.

A market price for EUAs emerges as a result of this trading. Carbon Retirement simply buys and retires EUAs. You can visit their website and start retiring carbon straight away if you know how much you need to account for, or they will help businesses to decide just what their existing emissions look like before deciding how many tons to take out.

I prefer this method of carbon emission mitigation because it actually takes these allowances out of the game. As the ETS scheme progresses there will be less allowances issued, making it harder for companies to maintain high levels of emissions without incurring financial pain, and that's the only way that you will get big business polluters to change their ways. In an ideal world we would all be reducing our emissions as fast as we can using tools such as NightWatchman Server Edition , as improving our overall efficiency and reliance on fossil fuels is far better than any type of offsetting. But realistically we do need offsets for now.By retiring your carbon you will be helping to put pressure on the biggest polluters to reduce their emissions too.

Read the complete post at http://www.1e.com/bizblog/post/2010/04/06/Give-your-carbon-emissions-early-retirement.aspx