What are carbon offsets? Can they actually cut planet-heating emissions?

illuminem summarizes for you the essential news of the day. Read the full piece on Market Realist or enjoy below:

🗞️ Driving the news: The concept of carbon offsetting is gaining traction as businesses and individuals seek actionable paths to mitigate their environmental impact
• This approach allows for the compensation of emissions by funding equivalent carbon dioxide savings elsewhere

🔭 The context: Carbon offsetting is part of a broader strategy to combat climate change, offering a pragmatic solution for those unable to reduce their emissions directly
• It involves a transaction where a carbon-emitting party invests in projects designed to reduce future emissions, effectively balancing their carbon ledger

🌍 Why it matters for the planet: Carbon offsetting can contribute to the financing of renewable energy, forestation, and other projects that have a positive environmental impact
• However, it's not without controversy, as some argue it allows companies to buy their way out of genuine sustainability efforts

⏭️ What's next: The market for carbon offsets is expanding, with new standards and verification processes being developed to ensure the integrity of offset projects
• This growth is expected to continue as more entities commit to net-zero emissions and look to offsetting as a tool to achieve their climate goals

💬 One quote: "While carbon offsets may not be the solution to climate change, they can still play a valuable role. The focus should be on making them useful by working on the flaws in the mechanisms of verification.” (Deep Das Barman, journalist)

📈 One stat: The voluntary carbon market is booming, with the value of traded carbon offset credits doubling in 2020 to over $1 billion, indicating a growing commitment to addressing climate change through market-based solutions

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