Download Consultations - Lancashire County Council

Cabinet Committee on Climate Change and the Environment
Meeting to be held on 24 May 2010
Part I - Item No. 9
Electoral Divisions affected:
All
An Introduction to Carbon Offsetting and the Lancashire Gulu Carbon
Compensation Scheme
(Appendix 'A' refers)
Contact for further information:
Fiona Cruchley, (01772) 533906, Environment Directorate,
[email protected]
Executive Summary
Carbon offsetting means paying another party to reduce carbon emissions
somewhere else on your behalf. This report outlines the complexities of carbon
offsetting and identifies a local scheme which seeks to minimise these and
maximise opportunities.
Recommendation
The Cabinet Committee on Climate Change and the Environment is requested to:
(a) Note the report, especially the complexities associated with carbon offsetting,
and;
(b) Note the work of the Lancashire-Gulu link charity to promote the 'carbon
compensation scheme' in Lancashire as an alternative to complex national
offset schemes and to schemes that fund projects often seen as 'impersonal'.
Background and Advice
What is carbon offsetting?
Carbon offsetting means paying another party to reduce CO2 emissions somewhere
else on your behalf.
Emissions from an activity such as a holiday flight or energy use in the home are
calculated, and then a contribution made to a project that will either reduce
emissions (e.g. through energy efficiency or renewable energy generation) or would
capture an equivalent amount of carbon (e.g. by tree-planting or peat bog rewetting).
There are practical complications associated with carbon offsetting, from how
emissions are calculated (particularly those associated with air travel), the time delay
-2between emissions and the reductions, and how it can be proved that emissions
reductions are additional to those which would have happened anyway.
Offsetting can be seen as controversial as it can sometimes be viewed as a
substitute to making real reductions in emissions. For this reason the Department of
Energy and Climate Change (DECC) urges all of the public sector to only use
offsetting where emissions are currently unavoidable.
Government Quality Assurance Scheme
Following consultation, the Government has recently introduced a new Quality
Assurance Scheme for Carbon Offsetting. This requires the offset provider to;
 Calculate emissions accurately
 Sell good quality carbon credits that comply with the Kyoto Protocol and have
been verified by the United Nations (UN) or the European Union's (EU's)
emissions trading scheme
 Cancel the credits within a year of sale and ensure that the same credit isn’t
bought twice
 Have transparent prices for their credits – e.g. how much they cost per tonne
of CO2
 Provide information about the role of offsetting in tackling climate change and
advice on how to reduce your carbon footprint.
There are currently 9 providers accredited under this scheme. The requirement for
verified carbon credits means that offset projects to reduce emissions in the UK are
not eligible (as the UK already has a duty to reduce emissions under the Kyoto
protocol).
Proving emissions reductions would not have happened anyway.
One of the key requirements of carbon offsetting is that the emission reductions
should not have happened anyway. The reduction must be unique. But proving or
verifying this is onerous and costly. It means that it is not cost effective to verify
small scale projects even though they may have significant wider environmental and
social benefits. Several major and well established carbon offsetting firms are
therefore ineligible under the quality assurance scheme.
So, verifying that a carbon reduction project would not have happened anyway (i.e.,
it is additional) is a very important part of carbon offsetting. But proving this can lead
to costly administration.
Where does carbon offset money go?
The Department for Environment, Food and Rural Affairs (DEFRA) has estimated
the UK carbon offset market was worth £250 million in 2009.
Some offsets are traded as commodities, so some of the money goes to those who
buy and sell them, brokers. Offsets may have been traded several times before
being purchased by organisations that are required to, or chose to, make carbon
reductions.
-3-
Much of the money paid for an offset goes to the firms who invest in the project that
reduces emissions. So far, three-quarters of all UN certified emissions reductions
have come from projects that stopped the release of industrial gases such as
Hydrofluorocarbons (HFCs), for example installing chimney abatement technology in
a factory in China. Such UN certified projects are often seen as expensive and
impersonal.
Avoiding double counting and proving additionality is complex and, to underline this,
several leading greenhouse gas emissions exchanges have suspended trading in
international offset project credits under the Kyoto Protocol’s Clean Development
Mechanism. The move is intended to limit the spread of fraud in international offset
credits.
Government Carbon Offsetting Facility (GCOF)
The first Government Carbon Offsetting Facility was launched by DEFRA in
November 2007 after a culmination of two years' development work in response to
the Prime Ministerial commitment to offset Government air travel emission. The
DECC has since developed a successor contract with Buying Solutions, which is
available to all public sector organisations. This scheme uses high quality UN
accredited offsets, but these fund projects that many see as 'impersonal' (e.g.
improvements to a factory in China).
Can carbon offsetting be used to fund projects in Lancashire?
Carbon offsetting cannot be used to fund projects in Lancashire. Carbon offset
projects must be additional to emission reduction projects that are already required.
The UK has a duty to reduce emissions under the Kyoto protocol and funding
projects to reduce carbon emissions simply replicates what the UK should already be
doing.
Lancashire Carbon Compensation Scheme
The Lancashire-Gulu Carbon Compensation scheme is a simple, voluntary
contribution scheme that consists of projects that provide Lancashire with a ‘carbon
advantage’.
The project is now in its third year, and it was established with the support of the
County Council. Support is now limited to a modest amount of officer time.
The scheme acknowledges the impact of emissions and then compensates for them.
Carbon Compensation is not the same as offsetting. By focussing on helping people
adapt to the impacts of climate change, carbon compensation does not “wipe the
slate clean”, but acknowledges that emissions have an impact and then
compensates for them by trying to lessen the damage caused.
The health impact of climate change is unjustly distributed. The impact is over 500
times greater in Africa than in England, according to the Chief Medical Officer.
-4The UN Inter-Governmental Panel on Climate Change has stated that developed
countries are having a substantial impact on developing countries because of our
emissions, contributing to poverty, drought and flooding.
The recent devastating floods across Africa (including Uganda) are an example of
this. This is forecast to worsen considerably. Changes in climate caused by carbon
emissions have a disproportionate impact on developing countries where per capita
emissions are extremely low.
By assisting the people of developing countries to adapt to changes in climate, which
will also enhance their resilience to other challenges, the impact of our emissions
can be acknowledged and reduced.
The development of the project has been undertaken as a partnership between the
County Council and the Lancashire Gulu Link charity here in Lancashire, working
with Gulu Municipal Council and the Gulu Lancashire Link charity in Uganda. The
project builds on a relationship between the 2 communities that was established in
the early 1990s.
The small scale of the scheme emphasises its community-to-community nature
(Lancashire to Gulu), unlike larger scale offsetting programmes where it is difficult for
individual donations to have a visible impact. The County Council supported the
initial phase of the scheme in 2008 and projects underway in Gulu include wetland
conservation, smallholder timber plantations, bio-diesel demonstration, agro forestry
and organic farming, beekeeping and integrated solid waste management.
Further details are given at Appendix 'A' attached.
Monitoring of the Lancashire-Gulu Carbon Compensation Scheme
Progress of the individual projects in the Lancashire Carbon Compensation Scheme
is monitored through quarterly monitoring reports received from the project
coordinator and environment officer at Gulu Municipal Council. Progress is good,
and the scheme is bringing benefits to the local community and participation in the
projects is increasing.
A response to each monitoring report is made by the
Lancashire –Gulu Link charity, with the County Council's comments added.
Promoting the Lancashire-Gulu Carbon Compensation Scheme
The Lancashire – Gulu Link charity takes the lead on managing the UK end of the
project.
The charity is promoting the scheme in Lancashire and is seeking contributions
where organisations and private companies wish to compensate for their carbon
emissions or make 'social responsibility' contributions.
The scheme therefore provides an alternative to complex national offset schemes,
which have been criticised for funding impersonal projects.
It can provide
Lancashire companies with a more visible and relevant project against which to
make contributions.
-5-
A very small amount of officer time is involved in assisting the charity in the carbon
compensation scheme this year.
Consultations
N/A.
Implications:
This item has no financial or legal implications.
Risk management
This report provides general information on the principle of carbon offsetting, and
does not have any direct risks linked to it.
Local Government (Access to Information) Act 1985
List of Background Papers
Paper
Date
Nil.
Reason for inclusion in Part II, if appropriate
N/A.
Contact/Directorate/Tel