Additionality Case Study
At the end of last year my phone's "stepper app" informed me that I had walked some 3,000 miles during the year, the equivalent of the distance from New York City to Los Angeles. It told me that the world was a "greener place" as a result, and that my walking had saved the equivalent of a ton of CO2 (based on otherwise driving the same distance).
What if the stepper app then offered to buy that reduction from me in order to sell it into the voluntary carbon offset market? Say the app offered to pay me $5. What if the stepper app had recorded 1 million people walking the equivalent of 3,000 miles. It hoped to pay out $5 million for the rights to those reductions, and to sell those offsets on the retail market for $20 million. A handy profit!
Here's the question: If I made the world greener by 1 ton of CO2 by walking 3,000 miles, as the app told me, can I sell that ton as a carbon offset? It’s a good question for exploring the challenge of assessing the “additionality” of projects being proposed as carbon offsets.
I walked the 3,000 miles because my dogs needed to be walked every day. I was not trying to reduce my carbon footprint; in fact my walking didn't reduce my carbon footprint at all since I would not have otherwise driven those same miles by car.
In previous years I had "walked" my dogs by letting them run behind me while driving on the beach. This year my doctor told me I needed to lose weight, so I started actually walking the dogs. During the year I did walk 3,000 miles more and drove 3,000 miles less (and I did reduce my emissions by 1 ton of CO2 ).
My 5th grader came home from school and informed me that I was a climate criminal for "walking" the dogs by driving on the beach. To get out of climate jail I agreed to do my part to reduce the family carbon footprint by driving less and truly walking the dogs.
Having happened to hear about the existence of a voluntary carbon market, and because I'm always short on cash, I signed an agreement with a carbon offset broker at the beginning of the year committing me to driving less on the beach and actually walking my dogs, with the stepper app serving as verification. I would be paid $5 for the ton of emissions reductions resulting from my changed behavior.
Which of these scenarios can legitimately generate carbon offsets?
Not Scenario 1 walking, since no emissions reductions occurred at all.
Not Scenario 2 walking, since the walking was not attributable in any way to the mitigating climate change, much less voluntary carbon markets.
Not Scenario 3 walking, since although based on the goal of mitigating climate change, the walking was still not informed or influenced by the existence of a carbon market.
Only Scenario 4 walking could legitimately generate qualifying offsets since it did result in CO2 reductions and was directly attributable to the existence of the voluntary carbon market (and hence additional).
Note that in each of these scenarios the “stepper app” verified that the walking associated with the estimated emissions reduction ocurred, but could not help at all with distinguishing beteen the four scenarios, and the “why” behind the steps. That’s ultimately what matters when it comes to additionality, and generally speaking offset verification or verifiers don’t touch the topic of additionality (it’s a common misconception that “verification” of a carbon offset extends to its environmental integrity. It doesn’t.)
How profitable will the stepper app end up being for its owners? Will the company successfully sell 1 million tons of CO2 reductions into the voluntary carbon market, netting $15 million dollars? It all depends on the scrutiny given to “testing for the additionality” of the reductions by whatever entity is charged with that task. See ** Testing for Additionality.
You might think that no one would ever actually propose Scenarios 1-3 (or the equivalent) for offset crediting, but you’d be wrong. This recent news story illustrates the point effectively.
Out of the original 1 million walkers who were told they’d made the world a greener placd, how many do you think are likely to fit into Scenario 4? Would anyone actually go to all the trouble of walking 3,000 miles in order to receive the $5 payment? It seems unlikely, which means that basically all of the “stepper app offsets” would constitute “false positives,” unable to legitimately offset other emissions.
The question that inevitably comes up next is: “Isn't it unfair to preclude the people who walked 3,000 miles from qualifying for the $5 even if their walking was for reasons other than the carbon offset market? How can you say that one person's 3,000 miles of walking benefited the climate, while another person's 3,000 miles of walking didn't?”
Quick answer? Carbon offset markets are not about fairness. They’re about incentivizing “additional” emissions reductions and carbon sequestration. If we’re going to let offset markets be swamped by non-additional reductions just to be fair, then we shouldn’t be using offset markets.