Old discredited carbon offsets sold to German companies – media report
German companies are among the top buyers of discredited, decade-old offsets in the voluntary carbon market, reports Carbon Pulse. Nearly 2.6 million Emissions Reduction Units (ERUs) generated in Russia and Ukraine from projects found to have low or questionable environmental integrity were sold to companies mostly in Germany and the U.S. by Netherlands-based ACT Commodities, which aimed to voluntarily offset their emissions. It is not clear how these units were marketed by ACT to their clients, or whether those firms were made aware by ACT of the controversy surrounding them, Carbon Pulse writes. The offsets – which have been banned in compliance carbon markets for most of the last decade after reports showed they largely did not bring about emissions cuts as promised – were generated under Kyoto’s Joint Implementation (JI) mechanism in the late 2000s and early 2010s and typically cost just a few cents each. ACT’s biggest buyers were Germany’s gas.de and Gruenwelt Gas, both subsidiaries of electricity retailer Stromio, with just over 2 million ERUs retired on their behalf in 2019, writes Carbon Pulse. Both companies did not buy any of these units in 2020. By the time of publication of this article the companies had not yet replied to a request for comment.
While the approach to offset emissions remains controversial, as it can be seen as a way to continue emissions-intensive practices, there is a fast-growing market for companies wishing to voluntarily offset their carbon emissions. More and more decide to implement climate targets for their business, including oil majors and other big emitters. Discredited units therefore raise concerns about this market’s credibility in demonstrating its contribution to climate action, as well as the validity of carbon neutral claims made by companies using offsets.