🌱 Offset ratings: Are they the solution to carbon offset confusion?
Featuring BeZero, Sylvera, ASK Italian, TiNDLE and more...
Happy Monday! May is here and we are bringing the research to you so that you can maximise your impact (and park time).
Carbon offsetting schemes are everywhere nowadays, from your workplace to your travel or delivery services, some even promising that elusive 'carbon neutral' label. But do they all pack the same punch? Unfortunately, the reality often falls short of the ideal. Today, we are putting the world of offset rating schemes in focus and the potential they hold for untangling this complex issue!
As always we bring you the Good(s) News from last week and share what we have been up to at FTF. Let’s dive in…
> In Focus
Rate My Offsets
by Rosalin Brolly
The voluntary carbon market holds potential to direct much needed funds to climate projects. However, its reputation and effectiveness has been repeatedly undermined by poor quality offset projects. This has led to claims of greenwashing from the use of offsets as well as stricter policies to govern what claims can be made from their use (read our guide on this here). In other words, putting a spotlight on quality in offset purchases.
Introducing offset rating agencies
So how can you ensure your business purchases only high-quality offset credits that deliver their intended climate impact?
As a recap, the intended climate impact of a carbon offset is the amount of avoided or reduced carbon emissions compared to the emissions that would have occurred if the project didn’t take place.
One option to ensure your impact is through offset insurance agencies (read more on this here); another is through offset rating agencies.
How does it work?
Offset rating agencies effectively allow you to outsource your due diligence to a team of experts who assess the risk of an offset project. They rate individual offset projects based on their likelihood of achieving their intended carbon impact, typically using a letter ranking scale. The methodologies these agencies use vary but are tailored to the specific type of offset project. They often include analysis of the project's carbon impact, as well as:
Additionality - Essentially assessing whether the impact is additional to what would have happened anyway without the intervention of the project;
Over-crediting - When a project overestimates the climate impact of a project; and
Permanence - This factor looks at how long the carbon will be stored and the likelihood of “leaks” e.g. a forest being cut down.
This comprehensive analysis is compiled into a single rating, enabling you as a buyer to easily identify and compare the risk and associated quality of offset projects, with lower rankings indicating greater risk.
So, who are these rating agencies building trust and transparency in your offset purchases? The main rating agencies are:
Sylvera: The only end-to-end carbon data provider, providing project level rating data as well as price and policy updates.
BeZero: 100% independent carbon risk toolkit for offset projects powered by expert analysts with transparent methodologies as well as headline ratings.
Calyx: This agency rates product level GHG and Sustainable Development Goal achievement, with the most credit ratings of any carbon credit rating agency.
Renoster: This agency provides project ratings with a focus on nature based credits, including pre-issuance ratings for nature based projects that are not yet on the market.
An example of a ratings scale. Source: Sylvera
Sounds great, how can I access the offset ratings?
Sounds great, right? So why isn’t everyone buying AAA offsets? The direct users of offset rating agencies, as listed on their websites, are primarily large enterprises. This is likely because their larger investments in offsets can justify the costs associated with using offset rating agencies. However, rating agencies also partner with offset marketplaces like Patch, Salesforce Net Zero Marketplace, Cloverly, and South Pole. As a result, their offset rating scores are often accessible to marketplace users, which can inform purchase decisions for SMEs. It's also worth noting that unlike other rating agencies, BeZero publishes their headline ratings for free, though they do not include the underlying risk factor analysis.
Also, keep in mind that due to differing methodologies, there are sometimes discrepancies in ratings between agencies. A Wall Street Journal review found that 26 out of 40 project ratings assessed were in agreement, but the remaining 14 diverged, especially concerning forest-based offsets. There is a bias-free alternative if you need to assess the quality metrics underlying the scores yourself through AlliedOffset data.
Do you have to become an expert in ratings methodologies? We think not!
Thankfully, unless we are one of these major investors, we should be able to leave the analysis to the experts. While AAA-rated offsets might not fit your company's budget initially, increased scrutiny empowers us to make smarter choices! As the market matures and quality standards solidify, offset rating agencies will give you more confidence in your purchases. By focusing on cutting emissions and using these extra checks, you can be sure your offsets have a good chance of working and avoid falling into greenwashing traps.
> Follow up with…
> Last week in consumer goods x climate…
The Good(s) News
Up and coming brands…
🎯 Beavertown Brewery have partnered with Campaign Against Living Miserably to produce limited edition potato crisps to raise awareness about mental health. The compostable crisps packet, produced by Parkside Flexibles, contains conversation starters designed to encourage deeper conversations amongst friends.
🎯 ASK Italian announced the use of 100% Wildfarmed flour for all of their pizza bases. The flour is produced using regenerative methods and reports a lower carbon footprint compared to conventional production practices.
🎯 SOJO, Ganni A/S and Nanushka have joined the British Fashion Council’s Institute of Positive Fashion Forum latest initiative Pledge to Repair. The initiative, built with a coalition of brands, aims to extend the life of clothing items through Care and Repair initiatives, with the details still to be finalised.
Bigger organisations…
⭐️Abel & Cole reported that to date they have donated over 2 million portions of fruit and vegetables through their One Box: One Portion initiative. This initiative donates one portion of fruit/veg to one of their partners - Dons Local Action Group, School Food Matters and The Felix Project - for every fruit and vegetable box sold.
Want good news sooner? We post our top 5 stories every Friday on LinkedIn! If your CPG brand has good news to share, let us know.👇
> In case you missed it
Want more? Here’s what’s happening across FTF at the moment…
FOMO keeping you up at night? We rounded up 5 of May’s best ‘climate x CPG’ events for you to choose from.
Reader Tim has kindly shared even more resources helping us reduce the emissions of the Cold Chain (if you missed it, check out Newsletter #136 on the topic here). Tim’s recommendations:
Pluumo Plus - made from surplus feathers.
Zero2Cool - using waste heat of the exhausts to power absorption chillers.
coolrun - passive cooling tech to reduce the need for refrigerated trucks.
Thanks for the recommendations!
Keep your eyes open for another update to our MEASURE database this week over on our LinkedIn page!
That’s it for today!
Want more? Check out ‘The Check-Out’ this Thursday for the latest brands in our basket. In the meantime, if you miss us, reply to this email or reach out at info@followingthefootprints.com to say hi. We’re always on the hunt for contributors, cool brands, and climate memes.
Much love,
Team FTF