Shifting Into Neutral

Dave Matthews Band is going neutral. So is Al Gore. The New Oxford English Dictionary picked "carbon neutral" as its 2006 Word Of the Year. But what exactly does it mean?

Defining Carbon Neutrality
Americans generate, on average, 26.5 tons of greenhouse gases—carbon dioxide (CO2), methane, nitrous oxide, sulfur hexafluoride, hydrofluorocarbons and perfluorocarbons—per person per year. But where most of us see a problem, a few resourceful entrepreneurs saw an opportunity. You can now pay one of over 30 carbon offset providers to eliminate those 26.5 tons. (Although not all greenhouse gases are carbon-based, "carbon neutral" has become shorthand for "greenhouse gas neutral"). Companies will, for instance, invest your money in a wind farm or in energy-efficient technology development, and voila! You're carbon neutral.

Why Offsets are Good
"Carbon offsets begin to stimulate a real market for renewable energy," says Bill Prindle, acting executive director of the American Council for an Energy Efficient Economy. "More and more money begins to flow into clean energy investments." And the new providers enable consumers to start making a difference now, rather than waiting for governments to act.

Why They Need Improvement
As simple a concept as it may seem, the carbon offset market is still very loosely defined. "We're still in the Wild West phase," says Laura Kosloff, vice president of Trexler Climate + Energy Services, Inc., and co-author of Clean Air-Cool Planet's "A Consumers' Guide to Retail Offset Providers," published last year. "Essentially, these providers are acting as brokers, and they may not have done any investigation into those projects," Kosloff says.

One criterion Kosloff highlights is "additionality," which exists where outside funding is truly needed to get a project off the ground and the environmental benefits go beyond what would have been achieved through smart business practices. Other criteria, such as permanence and measurability, can be difficult to establish. Then there's the murky issue of ownership: Because you can't see or hold the greenhouse gases you're offsetting, it's difficult to ensure that they aren't being sold multiple times.

Those who may be tempted to slack off, leaving lights and power strips on once they've paid to offset emissions, should think twice. "You're never going to have a zero energy home unless you aggressively reduce energy demand in your home," Prindle says. Even the offset providers encourage customers to "reduce what you can; offset what you cannot."