All terms

Carbon Offset

A reduction or removal of greenhouse gases used to compensate for emissions elsewhere.

What is a Carbon Offset?

A carbon offset is a quantifiable reduction, avoidance, or removal of greenhouse gas emissions (GHG) from the atmosphere that is used to compensate for emissions occurring elsewhere. One carbon offset typically represents one tonne of carbon dioxide equivalent (tCO₂e) that has been prevented from entering or has been removed from the atmosphere.

Why is a Carbon Offset important?

Carbon offsets play a role in climate mitigation by providing a flexible mechanism for organizations and individuals to address their carbon footprint when direct emissions reductions are not immediately feasible. They channel finance into projects that reduce emissions or remove carbon, supporting sustainable development and climate action.

Related terms

Want to explore this topic further? Browse connected glossary terms below.

Carbon Credit

A transferable instrument representing one tonne of CO₂ equivalent reduced or removed.

Core definitions
Emissions Reduction

Any action that decreases the amount of greenhouse gases released into the atmosphere.

Core definitions
Carbon removal

Carbon removal refers to processes that actively take carbon dioxide out of the atmosphere and store it for the long term.

Core definitions

Frequently asked questions

What is the difference between a carbon offset and a carbon credit?

The terms are often used interchangeably, but 'carbon credit' generally refers to the tradable unit, while 'carbon offset' refers to the action of using that credit to compensate for emissions.

Are all carbon offsets based on carbon removal?

No. Carbon offsets can be generated from various project types, including avoided emissions (e.g., renewable energy replacing fossil fuels), emissions reductions (e.g., industrial efficiency), and carbon removal (e.g., afforestation, direct air capture).

What are the concerns associated with carbon offsets?

Concerns include issues of additionality (would the project have happened anyway?), permanence (is the carbon permanently stored?), leakage (do emissions shift elsewhere?), and the risk of greenwashing if offsets are used to avoid direct emissions reductions.