Are we about to see a backlash over carbon credits?

By Heather Clancy | Jul 10, 2009 |

I am the worst kind of journalist in one very specific way: I believe the best of people unless shown that I should do otherwise. I really have to concentrate hard keeping my skepticism meter operating at full strength.

But there is one topic that has continued to perplex and irk me over my two years of cover green technology at the GreenTech Pastures blog, and that is the whole carbon credits marketplace.

I can’t tell you how many press releases, proclamations and breathless PR pitches I have received about companies that have gone 100 PERCENT CARBON-NEUTRAL! only to find that the only way that said company has been able to get there is buying scads of carbon offsets to compensate for its electricity consumption. Don’t get be wrong, I like the idea that your company is funding work on clean technology, or a solar installation, or a wind farm or some other renewable energy scheme. I like the carbon credit marketplace idea. But let’s be real: By simply going out and throwing money at a carbon offset provider, you really say that your company is carbon-neutral? I think not.

So, I almost screamed with joy when Yahoo! announced late in June on one of its corporate blogs that it plans to stop buying carbon offsets for its operations and instead will put that money into real honest to goodness energy reduction projects within its data centers. Its goal is to reduce the “carbon intensity” of its data centers by a minimum of 40 percent between now and 2014. Especially when it comes to a company like Yahoo!, which literally makes its living off its data centers, this just seems like a much more reasonable approach. I hope that other enterprises follow its lead and get more serious about overhauling their existing data center facilities.

There is one thing that I worry about a bit: If fewer companies buy carbon credits, will this negatively impact funding for renewable energy sources? I hope not, but I fear so.

 
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  •  
    1

    280ppm

    07/10/09 | Report as spam

    RE: Are we about to see a backlash over carbon credits?

    Heather,
    Whether the CO2 reduction occurs inside a companies gates or outside is irrelevant to the planet. Carbon offsets enable a person, company or country to reduce their carbon footprint, and impact on climate change, in the fastest, most efficient way.

    If Yahoo! used to pay $6.00 to reduce a ton of CO2 with offsets, and now, because of public pressure, are paying $15.00 to reduce a ton inside their gates (server farms), you have not helped the planet any more but have made the cost significantly higher. Conversely, if Yahoo! has found internal reductions for $4.00, of course they should pursue them, and that is hardly a rejection of carbon offsets. Indeed, the offsets they used to buy probably cost the project developer $4.00 which they sold for $6.00 to make it profitable.

    If you're into solving climate change, tear down your thinking boundaries. You offset things every day. You buy food from a grocery store because it would cost you too much to make it yourself. Your clothes are (likely) made overseas because it is too expensive in the US. Your computer, which you don't consider an indulgence, is built elsewhere, all offset with your dollars because it is more efficient to solve that problem.

    Let's not forget the benefits of carbon offsets. Supporting development and technology transfer, along with jobs and investment, in the developing world. Building wind farms in struggling farming communities, bringing investment, expertise and diversity to crop-based economies and keeping high skilled people in rural areas. And doing so while fighting climate change in the most effective way possible.

    If you are in favor of cap-and-trade legislation, and you should be, you are in favor of carbon offsets. The "trade" in cap-and-trade means offsets; one group increases while another decreases and a trade is made, exactly what occurs with offsets.

    Eric

  •  
    2

    alord017al

    07/14/09 | Report as spam

    RE: Are we about to see a backlash over carbon credits?

    Eric- I think what Heather is meaning to say is that Yahoo! is
    attempting to use the idea of carbon neutrality in its strict
    interpretation (I would guess she's got a very solid understanding of
    the beneficial ripple effect of carbon offsets).

    Purchasing offsets that directly fund projects does actually have a
    carbon footprint- everything does. They are looking internally to
    reduce theirs, rather than maintain static efficiency or inefficiency
    while investing in other projects. Maybe this is an approach other
    companies that are of Yahoo!'s size and stability should note.

    Tightening their belt on internal carbon intensity doesn't have to
    necessarily diminish their CSR. They've done a short-term
    prioritization. Maybe this is a bit idealistic, but a micro approach to
    sustainability could free them up financially to, later, invest/contribute
    to green on an external/ macro level.

  •  
    3

    adornoe@...

    07/15/09 | Report as spam

    RE: Are we about to see a backlash over carbon credits?

    Hey, Eric, you need to follow through on all of your thinking.

    If a company decides to farm out their production, you are automatically thinking that they've lowered their carbon foot-print because they'll be using less energy or fuels in their production of their goods.

    Yet, the opposite would be true. Think about it a bit.

    As an example, Wal-mart imports a lot of their products from China and Mexico and many other countries. Wal-mart does not produce any of their products. In that sense, their production foot-print is virtually non-existent. Yet, when you look at where Wal-mart gets their products from, you'll notice that virtually all of the countries involved don't give a rat's a-s-s about carbon footprints. In the overall equation, you could say that the Wal-marts of the world have a much higher carbon foot-print than those that produce their goods in their own country because their own country would have stricter guidelines for energy and fuel usage. Google, and Yahoo would have a much higher carbon foot-print than normal if they decided to set up their server farms overseas where the carbon crowd would not be able to regulate.

    Thus, there are many companies that appear to have no carbon footprint, yet, when the overall trail of their production is analyzed, they might end up near the top of those with huge carbon footprints.

    The coming carbon cap-and-trade crap will end up costing many millions of jobs to Americans. The jobs and factories with high-carbon foot-prints will end up being shipped overseas where the people and countries don't give a damn about green energy or carbon foot-prints. Yet, the American company will end up with a very low carbon footprint and the overseas company doing the production will have a very huge foot-print. In fact, CO2 emissions will increase overall rather than decrease.

    The carbon legislation being drawn up by Obama and the democrats will have very dire and unintended consequences for businesses and job creation. Stupidity reigns supreme with liberal ideology.

  •  
    4

    jdsnaker

    07/16/09 | Report as spam

    RE: Are we about to see a backlash over carbon credits?

    What frustrates me the most about all of the "carbon offsets", "green movement", "global warming", etc.,etc., etc, people (liberal dems) is that they refuse to even consider another point of view or that they may be wrong!

  •  
    5

    adornoe@...

    07/16/09 | Report as spam

    RE: Are we about to see a backlash over carbon credits?

    What frustrates me the most about all of the "carbon offsets", "green movement", "global warming", etc.,etc., etc, people (liberal dems) is that they refuse to even consider another point of view or that they may be wrong!

    I call that mentality, or that way of thinking, as "liberal ideology lock-down" or "liberal ideology prison". When a mind has gone to the point of no open-mindedness, then it's in a mental prison where other ideas are not welcome or allowed to enter. Those are lost causes for the most part.

  •  
    6

    JohnMcGrew@...

    07/20/09 | Report as spam

    The "Get out of Hypocrisy" Card

    Buying "carbon credits" to justify business as usual is little different than
    the middle-age practice of buying "indulgences" from the church to
    cleanse you from your sins. There's little real benefit to the environment,
    and those of us who know better have to listen to the sanctimony of those
    who think they've fooled either us, or themselves.

  •  
    7

    hoffmann367@...

    07/22/09 | Report as spam

    RE: Are we about to see a backlash over carbon credits?

    When you get a bunch of so called "experts" who give a Nobel Prize to a person that uses more electricity and water than a small township credibility goes out of the window. He spends money to buy trees to make his footprint smaller but the energy has still been used.
    "Carbon credits" and "carbon trading" in the future are going to cause a greater financial meltdown than the world has ever seen.

  •  
    8

    sk.dunnage@...

    07/24/09 | Report as spam

    RE: Are we about to see a backlash over carbon credits?

    The credits that were to be sold are being given away to the Utilities. The entire plan is BS.

  •  
    9

    BlazingEagle

    10/12/09 | Report as spam

    RE: Are we about to see a backlash over carbon credits?

    Being environmentally conscious is a noble goal, But until the ?energy efficient? alternatives are greatly better overall than the environmentally destructive ones, companies will obviously be reluctant if not outright dismissive of these alternatives.

    I?m all for environmentally friendly alternatives that are truly environmentally friendly but sometimes in the long run, some of these alternatives also end up being environmentally unfriendly.

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Heather Clancy

Heather Clancy is an award-winning business journalist in the New York area with more than 20 years experience covering the high-tech industry. She has a passion for green IT and regularly covers business technology issues and trends. Her articles have appeared in Entrepreneur, Fortune Small Business, The International Herald Tribune and The New York Times.

Clancy previously was editor at Computer Reseller News, the leading B2B trade publication covering news and trends about high-tech channels of distribution. In that role, she set editorial direction and led a staff of close to 30.

While at CRN, Clancy was the featured speaker on dozens of video netseminars, covering a wide range of topics including Software as a Service, managed services, convergence, IT security, mobile computing and high-tech channel program strategy. She has moderated numerous conference panel discussions and roundtables, and frequently was rated the top session facilitator at CMP Media's XChange conferences.

Prior to joining CRN, Clancy was a business writer with United Press International, where she covered everything from corporate mergers to the early days of the high-tech industry. She holds a B.A. in English literature from McGill University in Montreal, Quebec, and is a graduate of the Stanford Professional Publishing Course.

Heather Clancy

I’m sure cynical investigative reporters would discover that my lifestyle is about as sustainable as the average American, which is to say not so much. But I try. Really hard. Honest. And writing publicly about what the high-tech industry is actually doing to get greener or more sustainable is one way I figure I can contribute more meaningfully to the effort. I’m also a big OMG-kind-of-fan of smart leadership, which is why the goodly folks who publish this blog let me go on about this topic and why I am always on the hunt for forward-looking business management ideas.

My freelance hours are focused on looking for topics for my blogs, GreenTech Pastures and Business Brains, and writing articles for mainstream publication. I also contribute articles and blogs about VARs, resellers and systems integrators that deploy IT solutions for media company Tech Target. Occasionally, I’ll pop up at an industry conference in some sort of speaking capacity. In cases where a speaking engagement involves a sponsor that may be covered in this blog, this will be disclosed in coverage as appropriate.

My consulting activities include a relationship with SWOT Management Group, a firm in New Jersey that provides high-tech channel strategy and sales engagement insight to high-tech vendors. In the event that my commentary (in written, audio or video form) mentions a company for which I have provided consulting advice, I will disclose that fact. However, there is no connection between these projects and the topics that I’m covering in my blog.

Joe McKendrick

Joe McKendrick is an author and independent analyst who tracks the impact of information technology on management and markets. Joe is also SOA community manager for ebizQ, and speaks frequently on Enterprise 2.0 and SOA topics at industry events and Webcasts. He also serves as lead analyst and author of Evans Data Corp.'s highly regarded bi-annual SOA/Web Services and Web 2.0 surveys. Joe writes a regular column for Database Trends & Applications, and has authored numerous research reports in partnership with Unisphere Research for user groups such as SHARE, Oracle Applications Users Group, and International DB2 Users Group. In a previous life, Joe served as director of the Administrative Management Society (AMS), an international professional association dedicated to advancing knowledge within the IT and business management fields.

Joe McKendrick

Joe McKendrick is an independent consultant and editor. Joe has performed project work for the following companies in the IT marketspace: IBM, Systinet/HP, Teradata. He has performed project work for the following organizations in partnership with Unisphere Research (Unisphere Media): IBM, Oracle Corp., International Oracle Users Group, Oracle Applications Users Group, Professional Association for SQL Server, International DB2 Users Group, International Sybase Users Group.
Business Brains focuses on management issues that revolve around the key question: How do I make my business, family, and coworkers smarter? The blog examines the management issues facing a variety of businesses and debunks the technology you need to know