Britain warns of carbon credit crooks

Fiona Harvey, London
January 19, 2007

From The Australian.



COMPANIES offsetting their greenhouse gas emissions by purchasing carbon credits on the international carbon markets have been warned to verify that their investments are going towards genuine projects to reduce emissions.
An increasing number of companies, including HSBC, Marks & Spencer and British Sky Broadcasting, are choosing to become "carbon neutral", meaning they have no negative effect on the climate. This is achieved by reducing a company's emissions through energy efficiency measures and the use of renewable energy, and then "offsetting" the remainder.

Offsetting requires the company to measure its remaining emissions and invest in emissions reduction projects outside the company that cut an equivalent amount of carbon dioxide or other greenhouse gases. These projects range from tree-planting to building wind farms in developing countries.

Companies can do this through third-party offsetting specialists. However, environmental activists and the British Government said companies must do more to ensure their offsetting partners were investing in projects that were yielding real improvements in emissions.

Concerns are mounting that factories in China and carbon traders are exploiting a loophole in international climate change regulations that allows them to make billion-dollar profits from the greenhouse gas emissions trading markets.

Chemical plants are reducing the amount of HFC gases that they release into the atmosphere, and receiving "carbon credits" in return. A credit can fetch $US5 to $US15 on the international carbon market.

The equipment to reduce HFC gases is relatively cheap to install, at $US10 million ($12.7 million) to $US30 million for a typical factory, according to industry estimates. Installation can then generate carbon credits that can be sold for billions of dollars.

Friends of the Earth, an environmental pressure group, said: "There are strong concerns over the environmental credibility of many of the credits and the contribution of the projects to sustainable development. Money for an offset scheme should only be funnelled to projects that would not have happened unless the offset money was provided".

...

Read the article.

Also see Govt launches carbon plan.