Who Generates Carbon Offsets?

Learn about the carbon offset creation process.

by Greenwashed

Who Generates Carbon Offsets?
Photo by Luca Bravo / Unsplash



Projects generate carbon offsets.

Projects can use many methods to get carbon offsets, but all of their activities contribute to reducing or capturing carbon and other greenhouse gas (GHG) equivalents. These projects counteract human-made emissions while also improving the livelihood of people around the world.


While the specific methods used to generate offsets vary depending on the project type, there are only three ways to reduce emissions:

  1. Capturing and destroying a greenhouse gas at its source that would otherwise be emitted into the atmosphere. For example, a project could capture methane gas at a landfill before it escapes into the atmosphere.
  2. Producing energy using a clean, renewable resource eliminates the need to create that same energy from fossil fuels. Common examples of this are wind and solar farms.
  3. Storing (or “sequestering”) greenhouse gases to prevent their release into the atmosphere. For example, a project could buy and preserve trees (nature’s best way to store carbon) that were initially going to be cut down.

To be recognized as a carbon offset, a project needs the financial support of the VCM. Independent organizations (registries) monitor the amount of carbon a project saves to assign one offset for every tonne of CO2 removed. Projects then sell the offsets, and the profit is recycled back to the developers and turned into funding for future projects.

The Process:

To ensure a project delivers genuine impact, it goes through a strict verification test conducted by an independent third party. The projects’ reductions are tested on three key things: They need to be additional, permanent, and not harmful. These tests are time-consuming and expensive but necessary.


Additionality represents the extra environmental benefits of generating a carbon offset.

For example, a mangrove tree protection project in South Florida may generate offsets from the carbon reduction provided by the trees but only qualify for additionality for positively affecting the ecosystem’s biodiversity.

These certifications add value to a carbon offset because of the extra benefit created for the environment. Learning about which standards your offset provider adheres to ensure the offsets' quality is essential.

Other additional benefits include biodiversity, education, employment, food security, access to clean drinking water, and overall health & well-being in developing countries.


Permanence refers to the length of time an offset represents a reduction in atmospheric greenhouse gases.

Permanence is essential because some popular offsets, like forestry projects, aren’t permanent. Trees take many years to grow and mature, and they can be harvested or die before they ever reach their full carbon-sequestering potential.

When that happens, the reductions they represented disappear, and the offset becomes worthless. The best way to ensure an offset is permanent is to choose one from a source that will last forever, like a wind farm or solar installation.


Leakage refers to the unintended consequences of a carbon offset project.

For example, a landfill gas capture project may increase methane emissions if the gas is not fully captured.

Emphasis is placed on planning and creating proper foundations because an improperly designed project can cause more harm than good.


To generate carbon offsets, a project must prevent greenhouse gas emissions or capture them and prevent them from entering the atmosphere.

These projects can take many forms, but all must undergo rigorous verification to ensure that the carbon reductions are accurate, permanent, and verifiable. Only then can the project be certified and sell the offsets they produce.

By buying carbon offsets, you help finance these crucial projects. If you want to learn more about the movement behind carbon offsets, consider subscribing below, or offset your emissions here.