The principles of carbon offset
Because climate change is a global issue, preventing emissions of greenhouse gases anywhere in the world helps tackle the problem. This means that if you have reached the limit to what you can do in one place, it's possible to reduce emissions elsewhere and for that action to be treated as your own. This is known as offsetting.
Governments, international institutions and private companies have devised a trading system to enable organizations to pay for emission reductions elsewhere. Using this system, companies can buy carbon credits to offset some of their unavoidable emissions.
For example, a village in India uses kerosene for light and cooking. Villagers would really benefit from electricity but they are miles away from the grid and they can't afford solar panels. A specialist offset agency pays for the panels and creates credits for the amount of CO2 saved by avoiding the use of kerosene. One credit equals one tonne of CO2 avoided. The agency then sells the credit which is used to offset emissions.
WPP's carbon offset strategy
There are many different types of projects that earn carbon credits. Working with the CarbonNeutral Company, WPP has chosen to buy credits from those projects that bring the clearest environmental benefits. We are concentrating on renewable energy. We are avoiding offset schemes such as tree planting and improvements to industrial pollution control equipment because the environmental benefits of these are not as well established.
A typical project we intend to purchase credits from is in the Inner Mongolia (pdf) Autonomous Region of China, northwest of Chifeng City, where 36 wind turbines will be erected to make the Saihanba West Windfarm. Each turbine will have the generating capacity of 850kW with a total generating capacity of 30.6 megawatts.
Most of China's electricity comes from coal-burning power stations. The country does not offer financial incentives for technologies that use renewable sources of energy. By buying the credits from Saihanba West, we will be helping to make the project economically viable. This will help accelerate the take-up of renewable technologies in China.
All the projects we are supporting are independently screened against the CarbonNeutral protocol and independently verified by expert on the ground teams. In addition, the portfolio of projects selected for us will meet a range of exacting international standards such as the Clean Development Mechanism and the Climate Groups Voluntary Carbon Standard for additionality.
We will continue to work with our advisers to find offset projects that provide the clearest and most reliable climate impact reduction for our investment in the future.
The CarbonNeutral Company
WPP has chosen to offset through the CarbonNeutral Company which is a leading full service carbon management business.
The CarbonNeutral Company has 10 years of experience in delivering strategic carbon management programmes for Government, Corporate and NGO clients.