Offsetting vs Insetting Carbon Emissions

It’s no secret that becoming Carbon Net Zero takes time, effort and investment as it requires a business to remove all GHG emissions from their business and value chain – which isn’t a quick task. So for many, an interim approach to becoming more sustainable is to become Carbon Neutral. But what does that mean?

Carbon Neutral is when a business balances the carbon emissions they produce by investing in projects designed to reduce the effects of climate change. There are two different methods of offsetting emissions and which your organisation chooses will depend on your strategy. For offsetting a balance of scope 1 and 2 emissions to become Carbon Neutral, Carbon Offsetting is where you would want to focus, but if you are looking at the broader scope 3 emisssions too in a bid to achieve NetZero, then Carbon Insetting is a potentially better value return on investment.

Carbon Offsetting

Carbon offsetting allows companies to invest in environmental projects around the world in order to balance out their own carbon footprints. The projects are usually based in developing countries and most commonly are designed to reduce future emissions.

Carbon Insetting

Carbon insetting is when a business invests in carbon reduction projects within their own supply chain. Carbon insetting enables businesses to build stronger relationships with their suppliers by working with them to reduce the indirect emissions they produce throughout the supply chain.

As supply chain emissions are classed as a business’s Scope 3 emissions under the Greenhouse Gas (GHG) Protocol, organisations that undertake carbon insetting projects can also reduce their Scope 3 emissions. Businesses that have been focused on improving their carbon footprint for some time are now finding that their Scope 3 emissions account for the majority of their overall footprint.

A company can implement insetting in parallel with internal reduction measures and offsetting, thereby supporting long-term value chain management. If you want to explore how you can tackle your emissions, get in touch with one of our experts today.