Carbon Offsets

There is a growing interest in buying carbon credits to offset our carbon footprints. However, there is evidence of widespread failings in the market for carbon offsets. Some of these failings include:

  • Widespread instances of people and organisations buying worthless credits that do not yield any reductions in carbon emissions.
  • Industrial companies profiting from doing very little – or from gaining carbon credits on the basis of efficiency gains from which they have already benefited substantially.
  • A shortage of verification, making it difficult for buyers to assess the true value of carbon credits.

Here are some other articles that discuss the failings of the carbon offset market:

In addition, many carbon offset projects don't pay for the whole cost of CO2 removal projects; they just kick in a little money and claim all the carbon credit of the project. Is this really going to significantly reduce the amount of CO2 in the atmosphere?

Carbon Capture On Coal-Fired Power Plants

In my opinion, the only worthwhile and effective way of cutting back on CO2 increases in the atmosphere is to install CO2 scrubbers on coal-fired power plants.

To put this in perspective, if the developing world struggles and spends all the money needed to reduce it's emissions per the Kyoto treaty, we would cut our emmissions by almost 500 million tons by 2012. Not bad. However, in the same time period, the 850 new coal plants planned by the US, China and India will generate 5 times more emissions than this, about 2,500 million tons! Planting new trees or building wind generators is not going to put much of a dent in this number.

So paying for carbon scrubbing on coal-fired power plants, especially those in China and India, is the only realistic way to make a dent in the increase in CO2 emmissions.

Here are some references that discuss the importance of this:

Carbon Scrubbing Costs

How much does carbon scrubbing of coal-fired power plants cost? Hard numbers on this are not easy to find, but here is one set of numbers:

Europe Tests Carbon Capture at Coal-Fired Power Plant

The pilot installation is intended to capture one metric ton of CO2 per hour.

The cost of conventional processes for CO2 capture in the flue gases of large industrial facilities, already operational in Japan, is estimated at between €50 and €60 per metric ton of CO2.

The Elsam industrial pilot is expected to halve the cost per ton of CO2 avoided, to between €20 and €30.

The total pilot project cost of €16 million is about half funded by the European Commission, with the remainder being funded by private partners.

So operating costs to scrub one ton of CO2 from a coal-fired power plant is between $24 and $71. (I used (Euro/Dollar = 1.3, Metric ton/US Ton = 2204.6/2000 = 1.1). If we figure that the equipment has a 20-year life span, this adds another $108 per ton. So taking the average operating costs to be $50/ton adding depreciation of about $100 a ton and storage/sequestration costs of $10/ton (EPRI Briefing, slide #30), then the total cost of adding CO2 scrubbers to coal-fired power plants is $160/ton of CO2.

Carbon Offset Costs

The average American carbon footprint is about 50,000 pounds per year, (References: Carbon Fund, UN) or about 25 tons.

Some carbon offset organizations will charge you as little as $100 to offset this amount.

However, based on the cost to clean a coal-fired power plant which is probably the only really effective way to make a dent in CO2 emissions, the true cost to offset the American carbon footprint should be $4,000 per year ($160 x 25) not $100/year!

 

Revised on September 17, 2007 13:30:48 by Max Dunn (69.226.252.210)