The key issue about projects for carbon offset is to ensure that the scheme being funded achieves the carbon savings promised. This requires both the effectiveness of the project at soaking up CO2 or avoiding future emissions and the additionality of the carbon savings progressively. The challenge is to to prove additionality over the life cycle of a project beyond its baseline with absolute certainly, as one may be unsure of future developments with the project or certain of the alternative scenario without the project in existence. Offset providers must therefore also provide guarantee for their emissions savings through another project to cover any case of emerging loss of savings due to non-additionality of counts.

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Offset Market Approaches

1. Offset companies could mobilize enough capital to invest in projects for offset speculative sales by funding an offset project to sell its carbon savings when certified. This helps to predict future dynamics of savings additionality– and claims of emissions value depreciation over the lifecycle of the project.

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Carbon Market Certification Standards –

1. Voluntary Gold Standards – based on the Kyoto protocol, and must also show social benefits for local communities

2. Voluntary Carbon Standards – it also follows a rigorous but simplified process, thereby allowing a greater range of innovative small-scale projects.

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Price and Estimation of carbon offset

1. There are various ways of estimating the precise impact of project carbon savings on climate change for certain types of activity – such as flying, which affects global temperature in various ways.

2. Again, different types of offset project will inevitably have different costs – especially given that projects may be chosen not just for the CO2 impacts but for their broader social benefits.