Shell, one of the world’s largest oil companies, has set aside $450m to invest in carbon offsetting projects, with the goal of spending the equivalent of half the current market for nature offsets every year. However, a joint investigation by the Guardian, Die Zeit, and Source Material into Verra, the world’s leading carbon standard for the voluntary offsets market, has found that more than 90% of their rainforest offset credits are likely to be “phantom credits” and do not represent genuine carbon reductions.
Shell’s decarbonisation strategy includes reducing their scope 1 and 2 emissions from 68m in 2021 to 41m in 2030, through renewable power and efficiency improvements, with nature-based solutions (NBS) accounting for 2-7m tonnes of this reduction. In 2020, Shell invested $90m in NBS projects, and allocated $480m to various projects the following year, with $456m of it for NBS projects. Shell has also been involved in the creation of the carbon market, with staff sitting on key advisory posts.
The growth of carbon offsetting markets has been welcomed by many companies as part of their net zero plans, but the Guardian investigation found that the credits produced by the offsetting projects may not be effective in reducing carbon emissions. Lavazza, Leon, Berkeley Group, easyJet, Gucci, BHP, Salesforce.com, Pearl Jam, Disney, Boeing, and many smaller companies have all used offsets from projects that were either ineffective or stopped no deforestation.
Thomas Crowther, professor of ecology at ETH Zürich and co-chair of the United Nations Decade on Ecosystem Restoration, commented on the findings, stating that transparency is a key challenge and that it is critical to use the best available scientific approaches to ensure the accountability of environmental commitments at scale. He urged companies and citizens to be able to support projects they can trust, and for the creation of a system to make this a reality.
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