Carbon Offsets: An LCA Perspective

Carbon offsets as an additional measure to mitigate climate change are on the agenda in recent years. This study analyzes the three carbon offsetting programs (the Clean Development Mechanism, the Verified Carbon Standard and the Gold Standard) with the largest market shares by systematically comparing their standard documents with environmental Life Cycle Assessment (LCA) standards (ISO 14067 and ISO 14040/44). The programs’ most important methodologies are assigned to the sectors forestry, renewable energy, energy efficiency, industrial gas, and waste. We analyzed each sector for its compatibility with LCA using a criteria evaluation scheme to answer the main question, whether the methodologies provide guidance on life cycle emission accounting and what uncertainties they face. The offsetting standards differ from LCA standards due to different analyzed systems, system boundaries and purposes of their methods. Furthermore, offsetting methods always apply scenario analysis. Environmental impacts apart from greenhouse gases are not quantified, rather environmental impact assessments of heterogeneous quality are applied. We find that the approaches in the analyzed carbon offsets are incompatible with the LCA approach, mainly because they always involve scenario analysis, do not include all life-cycle phases and do not account for additional (negative) environmental and social impacts that project activities related to carbon offsets may cause.