In the past few years, there has been a proliferation of countries and organisations pledging to achieve net-zero emissions. While organisations should prioritise reducing greenhouse gas (GHG) emissions from their own operations and supply chain, the use of carbon offsets is necessary for emissions that are currently not technologically viable, or too costly, to eliminate.
Carbon offset units can be generated pursuant to many different standards and used for both compliance purposes and voluntary purposes. In this client alert, we focus on the generation of offsets that may be used for voluntary purposes. The size of the voluntary carbon market was valued at over USD 1 Billion in 2021. The Taskforce on Scaling Voluntary Carbon Markets found that voluntary carbon markets need to grow by over 15 times by 2030 in order to make a meaningful contribution to limiting global temperature increase to 1.5°C.