Carbon offset programs require the application of rigorous quantification, verification, and enforcement criteria in order to ensure that the integrity of greenhouse gas (GHG) caps is not compromised. Some types of climate change mitigation activities—especially those involving soil or forest carbon sequestration—are less likely to meet these criteria than others. It is possible to overcome these challenges, but doing so entails costs that might be avoided if these GHG reductions were achieved through other policies and measures. Deciding which types of GHG reductions to include in a carbon offset program should therefore be part of a broader strategy to achieve economy-wide GHG reductions at the lowest overall cost.
The analysis presented in this brief is not intended to suggest that entire categories of activities, such as carbon sequestration activities, should be categorically excluded from a U.S. carbon offset program. It does suggest, however, that U.S. policymakers need to carefully consider the various options for achieving GHG emission reductions in “uncapped” sectors of the economy. Carbon offset programs are attractive for many reasons, but they require the application of rigorous quantification, verification, and enforcement criteria. Some types of activities are less likely to meet these criteria than others, and many activities involving soil or forest carbon sequestration are at an inherent disadvantage. Policymakers should look holistically at the range of options for reducing emissions at uncapped sources, and set targets for capped sources as part of an overall suite of climate change policies.
In designing a U.S. carbon offset program, policymakers should: