Who Buys Carbon Offsets?

Overview

Across the voluntary and compliance markets, carbon offsets are purchased by countries, institutions, and individuals. The prioritization of climate change has inspired hundreds of businesses to take carbon-neutral pledges or just reduce internal emissions. Major companies like Amazon, Google, and Microsoft have all announced plans to go carbon-neutral. Individuals have also kick-started volume in the market as more people decide to offset their carbon footprints.

• Individuals: While they don’t make up the majority of trading volume in the market, individuals, or the “retail” sector, play an important role as carbon offset buyers. Everyone in the world emits pollutants in one way or another every day. We drive cars, use electricity, and fly on planes. By offsetting their personal emissions, individual buyers pioneer an important ethical movement that influences the way people think and act about sustainability in the modern world.

• Institutions: The largest purchaser of carbon offsets are institutions, which also make up the majority of emissions. Some of the biggest institutional buyers of carbon offsets include notable corporations, universities, governments, and nonprofits. For example, Google recently spent almost $1 billion on carbon offsets and Microsoft has purchased offsets to compensate for emissions from its cloud computing services. Governments such as the UK Parliament and the California State are large offset purchasers, as well as large NGOs such as the Bill & Melinda Gates Foundation.

• Compliance Industries: It’s important to note that not all companies use the carbon offset market to reduce emissions. Some companies are regulated by compliance markets, which are a slightly different form of environmental accounting. Since these companies already have environmental costs purchasing carbon credits, many of them do not purchase carbon offsets.

Conclusion:

Carbon offsets satisfy the needs of a diverse group. The purchasers range from large institutions like Google to your close friends and family. The one thing that all these groups have in common is a desire to mitigate their environmental impact and contribute to a sustainable future. At the end of the day, we all impose costs on the planet, and buying carbon offsets is how certain groups and individuals take responsibility.