The carbon offset controversy continued into this week. You will recall I blogged about it here, here, here, here and here. It took me much of this week but I have no completed my academic paper on this issue. It is available here.
Put simply, carbon offsets pretty much always will cause net emissions to fall. I found one case (at the end of Section 5, Proposition 3) where offsets may cause emissions to rise. Put simply, under certain offset arrangements, ‘dirty’ generators might engage in predatory behaviour against clean ones (dumping dirty power on the market) . But this is a problem of market power not offsets themselves.