Carbon offsets or clever marketing?

Hanna writes*

The weather is getting colder and Christmas is right around the corner. Some of us may be staying home, but others are booking flights to various holiday destinations — skiing in the Alps or beaches in Mexico or Hawaii.

What most of us don’t account for when booking these amazing trips is the damage we are doing to the environment. Specifically the large amounts of CO2 that get put into the atmosphere with each and every flight. Nowadays with the advancement in technology we are able to calculate an individual’s carbon emissions for a flight. Airlines then provide a possibility to “offset” (pay) for those emissions. Depending on the distance of the flight, offsets cost $2-60. This money then goes to different environmental schemes. Many focus on preserving forests via REDD+ (Reducing Emissions from Deforestation and forest Degradation) programs.


Recent studies show REDD+ projects in Brazil’s Amazon have not been as effective as claimed: there was no significant evidence of reduced forest loss. The International Civil Aviation Organization has approved ineffective REDD+ projects such as these.

Offsets can also be misleading because an individual’s payments do not directly offset emissions. It takes years for a tree to grow and absorb CO2 at full capacity. Another issue arises if (when) global warming leads to more forest fires — resulting in releases rather than storage of carbon.

Carbon offsetting projects paint aviation and airlines in green, which can help them compete, increase sales, and strengthen customer and employee loyalty. But perhaps airlines are using these projects as “smart marketing”  rather than helping the environment or focussing on the real issue: reducing aviation emissions.

Bottom line: We should not automatically believe that we are helping the environment when paying for offsets. Instead, we should research individual airline projects for evidence of effectiveness — or maybe just not fly.

* Please help my Environmental Economics students by commenting on unclear analysis, alternative perspectives, better data sources, or maybe just saying something nice :).

Author: David Zetland

I'm a political-economist from California who now lives in Amsterdam.

5 thoughts on “Carbon offsets or clever marketing?”

  1. Dear Hanna,

    Nice post! I was already wondering if these carbon offsets were not simply marketing strategies, and your post shows me how they actually might be. What I found interesting is that the issues you point out are the same issues we find in other climate models. The fact that payments do not have an immediate impact but take some time to offset the emissions of the flight explains the difficulty that all climate models deal with: having to make decisions of which the benefits will not be visible right away. That is where the discount rates come in, which made me wonder if that is also what is happening here: do you know by any chance if very high discount rates are used for these offset prices (because $2 seems like a joke to me). The other issue you pointed out, global warming leading to forest fires, also links to the problem with other climate models: tipping points are often excluded. It’s interesting to think about what kind of offset prices we would use when the risk of tipping was included. Both these points show that the offset prices should probably be much higher to actually reflect the negative impact of the emissions. However, if the offset prices get very high, people are not going to be willing to pay it. If the offset costs were included in the ticket, that would be a good thing, because simply less people would fly. However, seeing that it’s an optional cost, raising it too far might actually lead to less revenue. Therefore, I could imagine that, if offset costs stay an optional cost (which they should probably not be), raising it will not be more effective. Would you think an increase would be good? Or would you opt for a whole other system?

    1. I agree, when I saw the cost of 2 dollars I thought it was a bit of a joke as well. British Airways is actually incorporating these carbon offset costs into all their tickets costs for flights within the UK. In a way ensuring that these 2 dollars are being paid.
      In general though I am still not sure how efficient this system is. I think that the airlines need to be exploring other ways along side these carbon offset programs to become more environmentally friendly. For example in better fuel, or in aircrafts that require less fuel.

  2. Hey Hannah, insightful blog post! It is indeed dubious that airline companies are able to offset their/your carbon emission for such a low cost. Quite disappointing that REDD+ programs are not successful.
    I think it is good to contrast these REDD+ programs with other carbon offset options such as direct air capture. Direct air capture technologies extract CO2 directly from the atmosphere. With this method you do not have to wait decades for the tree to grow and you can be confident that CO2 is actually removed from the atmosphere.
    Companies, such as Climeworks, are selling carbon offset memberships in which you pay 1 euro/kg CO2. Paying 600 euros per year would reduce your net CO2 emissions with 600kg This seems like a considerable CO2 offset. However, if you compare this to the emissions of one 7 hour flight that roughly emits 630 Kg CO2, you would need to pay 630 euros on top off price of the ticket. Even more costly would it be if you wanted to offset the emissions of the average person living in the U.S. that emits roughly 15 tons per year, meaning it would cost them 15 000 euro per year to offset their emissions. Bottom line: we are still far from effective carbon offsetting, reducing our consumption is not only cheaper (even profitable) but also much more effective.

  3. I really enjoyed your blogpost, good work!

    I was wondering whether there are airlines that actually do use their offsets in an effective way. I see how these offsets can be misleading when not properly used, however, do you think that offsets maybe could have a positive impact on the emissions of flying in the long run (keeping in mind that a lot should change of course)?

  4. This is a really interesting topic because it hasn’t been talked about too much yet. Considering there is little available information on this topic, you did a really great job of explaining the issue. Some things left unclear for me are – when you say that most airlines preserve forests through REDD+ programs, what does that really mean? How many / which airlines support these specific programs? I am also left wondering why did they choose this program? Do you think they are getting any kickback from this choice as opposed to supporting programs proven to be more effective? I am not sure if answers to these questions would be publicly available but it is just something to think about.

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