President Joe Biden's administration on Tuesday issued new guidelines in buying carbon credits, otherwise known as "offsets," to ensure the integrity of the purchases.
The move by the Biden administration comes amid growing concerns that the existing practices do not diminish greenhouse gas emissions at the levels claimed. The new guidelines are anchored in the hopes of ensuring that the credits that are being sold are credible.
Businesses, individuals and other entities with the goal of achieving net-zero may be able to buy these credits to "offset" their carbon emissions. These credits can then come in many forms, including the act of paying organizations to plant trees in behalf of the businesses or individuals who bought the credits. In some cases, buyers can use the credits to prevent other entities from cutting down trees.
While the purpose of the offset mechanism may be noble, the actual implementation is plagued with issues, one which is double-counting. There were also questions with regard to markets that work on preserving trees, with queries concerning the possibility of them being cut down or for how long will they remain protected, The Hill reported.
It was noted that about $1.7 billion was spent last year by companies through the purchase of carbon offsets in their effort to achieve net-zero and to make up for their carbon emissions by engaging in environmentally-friendly activities that remove carbon dioxide from the atmosphere elsewhere.
The New York Times reported that there are researchers and scientists who claim that the carbon credits are "flawed" and the system must be abandoned. They suggest that companies focus on making an effort to cut their own carbon footprints, and that these entities must also be able to disclose to the public the nature of their credits.
The Biden administration claims that the offsets could be an important tool for helping entities reduce their emissions for as long as guidelines are in place.
"Voluntary carbon markets can help unlock the power of private markets to reduce emissions, but that can only happen if we address significant existing challenges," Treasury Secretary Janet L. Yellen revealed in a statement.
"The principles released today are an important step toward building high-integrity voluntary carbon markets," she added.
Yellen is scheduled to discuss the new carbon offset guidelines with other administration officials in Washington on Tuesday.
