The cleanest model

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.

One thought on “The cleanest model”

  1. Joshua, I suppose you are assuming that offsets reduce emissions within the timeframe they are credited.

    Unfortunately in reality, politics and perverse incentives mean that alot of offsets do not work in this way.

    Forestry projects are the worst, typically crediting b/w 40-70years offsets up front. However offsets from solar hot water, PV and other projects all benefit from this accounting trick.

    Once this is understood, modelling such as what you have carried out has limited value in assessing real world outcomes.

    We need to engage in the nitty gritty of the real world, not kick back on theoretical models, applauding ourselves for a job well done.

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