12 Companies That Are Buying Carbon Offsets
Companies of all sizes are facing an uphill battle when it comes to reaching their net zero and carbon neutral targets, but carbon offsets can help counteract unavoidable greenhouse gas (GHG) emissions.
In contrast to carbon reduction strategies — which aim to eliminate emissions internally — carbon offsets work by funding GHG reduction projects outside the company’s value chain.
This can help close the gap between a company’s current emissions and their climate targets. And for activities where there aren’t good low-carbon alternatives, such as shipping and air freight, carbon offsets may be the only way to negate the environmental impacts.
For these and other reasons, companies in a variety of industries have decided to invest in carbon offsets.
We’ve rounded up a list of 12 companies that are using carbon offsets to help reach their sustainability goals. The list includes tech, automakers, oil and gas companies, cement producers and more, and underscores just how widespread the use of carbon offsets has become.
Which companies are buying carbon offsets?
- General Motors
Google parent company Alphabet has a long history of purchasing carbon offsets. Today, the company has eliminated its entire lifetime carbon footprint through the purchase of high-quality carbon offsets.
Cemex, one of the largest concrete producers in North America, has developed a first-of-its-kind net zero concrete. About 70% of this carbon reduction is possible due to innovative new material created by Cemex. The remaining 30% comes from carbon offsetting efforts.
Historically, Delta has been one of the largest purchasers of carbon offsets. The airline bought 7.8 million metric tons of CO2 equivalent between 2017 and 2019, and plans to spend more than $30 million to offset 13 million metric tons of carbon emissions — most of its 2020 impact.
Since 2009, the Happiest Place on Earth has implemented an internal carbon tax. Money from the carbon tax is deposited into a Climate Solutions fund, which is then used to fund efficiency projects and buy carbon offsets. Disney’s investments in carbon offsets have reduced greenhouse gas emissions “equivalent to removing 900,000 cars from the road”.
The US’ largest automaker plans to be carbon neutral in its global products and operations by 2040. To reach its goals, GM wants to end production of all diesel- and gas-powered vehicles and exclusively offer electric vehicles. Other reductions will come from switching to renewable energy. Carbon offsets will be used to balance out any remaining emissions, though the company notes that “offsets must be used sparingly and should reflect a holistic view of mitigating the effects of climate change.”
Honeywell has pledged to be carbon neutral in its facilities and operations by 2035. Along with investing in energy efficiency projects, switching to renewable sources, and electrifying its fleets, the multinational industrial company plans to use credible carbon offsets to balance out any remaining CO2 emissions.
Like other airlines, JetBlue has grappled with how to negate emissions from air travel. In 2020 it became the first US airline to commit to and achieve carbon neutrality for all domestic flights by offsetting CO2 emissions from its jet fuel.
Microsoft has achieved carbon neutrality primarily by investing in offsets that avoid emissions instead of removing carbon that has already been emitted. However, the computing giant now plans to take things a step further by removing all the carbon the company has emitted since it was founded in 1975.
PG&E’s ClimateSmart™ Program allows utility customers to add a small, tax-deductible monthly donation to their regular utility bill to support projects that reduce or absorb carbon emissions in California. These projects include restoring native redwood forests, capturing methane gas from landfills, and destroying refrigerants from old freezers and air conditioners. To date, approximately 30,000 customers have participated in the program and offset more than 686,000 metric tons of greenhouse gas emissions.
In 2017, Salesforce achieved its goal of net zero greenhouse gas emissions by purchasing offsets for emissions associated with electricity use that couldn’t be avoided, reduced, or offset with renewable energy purchases. Now, the tech titan is working toward reaching 100% renewable energy by 2022.
Oil and gas companies like Shell who rely on carbon credits to offset emissions from their operations are constantly seeking ways to mitigate the risk of future price increases. One strategy is to buy entire carbon projects — or the companies that develop them. This is a way to ensure credits are available for their own use when they need them, as well as to sell to other companies.
Unilever is known as a leader in environmental sustainability. In 2021, the consumer goods conglomerate — along with Disney, Google, Microsoft, Salesforce, and others — formed the Business Alliance for Scaling Climate Solutions. The alliance will focus on improving climate solutions, and specifically, ensuring that carbon credits claimed by companies represent “additional, real, quantifiable and verifiable emissions reductions or removals”.
As the demand for carbon offsets increases, so does the price. The cost is expected to reach between $20 and $50 per metric ton of CO2 by 2030 — a tenfold increase over current prices. And the more companies that purchase carbon offsets, the higher the price will be.
Buying offsets when prices are high will be costly, and depending on them to make up for emissions while continuing with business as usual can be a risky move. A safer bet is to simultaneously work to reduce emissions as much as possible while purchasing carbon offsets to cover the difference.