More than 90 per cent of the country’s biggest polluters are undertaking voluntary emissions reductions regardless of government policy measures like the Emissions Reduction Fund, according to a new survey from the Carbon Market Institute in conjunction with RMIT.

CMI chief executive Peter Castellas told The Fifth Estate his organisation was seeing a lot of businesses with plans for emissions reductions.

The actions being taken range from investments in energy efficiency improvements and changes in behaviour and practices, to voluntary purchase of carbon offsets.

The survey of 68 firms, more than half of them required to report emissions as part of the National Greenhouse and Energy Reporting Scheme, found that the number one driver for emissions reductions was cost savings achieved through energy efficiency.

Dr Tim Richards

Dr Tim Richards, CMI’s manager for policy and market development, said that 53 per cent of the firms surveyed were likely to increase their voluntary emission reduction activities “independent of government policy or the existence of a carbon tax”.

Other drivers aside from reduced energy bills included improving brand reputation and meeting corporate social responsibility goals, and for some firms, aligning their own activities with competitor’s pollution-reduction actions or broader sectoral trends.

Dr Richards said the firms were asked to what degree stakeholder views mattered in their decision-making around carbon emissions, and the survey found that the boards of firms were a key driver. The community and shareholders were also influential.

The survey found that 54 per cent of firms had dedicated targets including emissions reductions, increased renewable energy use and also reducing emissions intensity. Eighty-six per cent of the firms had a dedicated strategy for achieving their targets.

Dr Richards said 2020 was a common end point for target-setting, but that a number of firms were looking at post-2020 targets of a 50 per cent reduction in emissions.

Twenty-four per cent of the firms surveyed were engaging in voluntary offsetting, and 30 per cent rated achieving carbon neutrality as “high” or “very high” in importance.

Carbon credits in the voluntary offset market were financing projects including reafforestation and the introduction of renewable energy and other sustainability technologies into developing world communities, Dr Richards said.

These projects generally had a high level of co-benefits such as increased community resilience, improved catchments, protection of flora and fauna and improved economic wellbeing, particularly in the case of developing world offset projects.

The fact the projects often have a visual dimension as well also makes them attractive to firms seeking offsets they can showcase to employees, shareholders or other stakeholders, and Dr Richards said this assisted firms make the case for purchasing the carbon credits the projects generate.

“It is a difficult challenge communicating the ‘what it looks like’ of offsets,” Dr Richards said.

“A big factor is communicating the co-benefits.”

Because carbon is “so big and complex and multifaceted” as an issue, offset projects that have understandable co-benefits also give stakeholders a way of humanising the carbon issue.

At this stage, however, many ERF projects such as flaring landfill gas, do not have a high level of apparent co-benefits. Dr Richards said co-benefits were not made part of the policy around the ERF.

“The ERF is more a formal policy, whereas the voluntary market has the feel-good factor as well,” he said.

He said it was important the voluntary market remained separate from the ERF and the mandated carbon market space, so it “is also distant from the political toxicity around carbon”.

“The voluntary market is a genuine market. The advantage it has is the co-benefits, where projects are good for the environment and the community as well, not just [reducing] carbon.”

Revegetation, reafforestation and other land-based projects also had the advantage of actively sequestering carbon emissions, and where existing vegetation was being protected, reductions in emissions as well.

“The land-based [projects] have real potential, as more vegetation means more [carbon] sequestration,” he said.

“When you re-establish forest and also when you protect it, there is a huge amount of extra benefits.”

While restoring and protecting vegetation as a measure both involve “locking up” land long-term, Dr Richards said there was currently a substantial amount of research being undertaken into how some of these areas can still be used in a sustainable and productive way.

For highly developed economic sectors such as property, transport and infrastructure, “there is only so much you can reduce emissions” through energy efficiency, fuel substitution and other means, Dr Richards said, “so sectors can offset the [residual] emissions through the voluntary market.”

“All the pieces fit into the whole big picture.”

One reply on “Big business looking to voluntary carbon market for offsets”

  1. Willow have you ever talked to Wayne Sharp CEO of Carbon Trade X Change.

    https://youtu.be/uxe3v4qyvIE

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