Offsetting
Offsetting is when an organisation compensates its greenhouse gas emissions by purchasing carbon credits to finance emission reductions or carbon removals elsewhere. A carbon offset is an electronic certificate that represents the reduction or avoidance of one metric ton of greenhouse gas (GHG) emissions, typically carbon dioxide equivalent (CO2e), that has been achieved by a project or activity in another location or sector. Carbon offsets are generated by projects that reduce or remove GHG emissions, such as renewable energy, energy efficiency or forestry projects that sequester carbon. The purpose of carbon offsets is to create a financial incentive for emissions reduction and to support the transition to a low-carbon economy, while allowing purchasing companies or individuals to offset their own emissions.
Carbon offsets are also referred to as carbon credits.
