A carbon offset is the reduction, removal, or avoidance of greenhouse gases (eCO2) from the atmosphere that serve as a counterbalance to emissions from other activities. Carbon offset projects come in many forms but generally fall into two broad categories: 1) projects that reduce or avoid emissions, such as the installation of a wind park to replace a coal-fired energy plant, and 2) projects that sequester or remove greenhouse gases from the atmosphere, such as planting trees that absorb atmospheric carbon as they grow.
In Colgate's case, we can "offset" some of our gross emissions by investing in off-campus projects that effectively mitigate atmospheric greenhouse gases. This is a legitimate second option to reducing on-campus emissions since with regard to global climate change it does not matter where on earth emissions are generated or sequestration is enhanced: the effect on global climate change is the same. Thus, if Colgate chooses to acknowledge the harm done by its own operations, it can do so by 1) reducing emissions on-campus or by 2) reducing emissions elsewhere, that is, through the purchase of legitimate carbon offsets.
While implementing on-campus projects that reduce Colgate's gross emissions is Colgate's top priority, the University must invest in carbon offsets to achieve climate neutrality by 2019. Significant emissions sources such as air travel, commuting, and some forms of energy use are currently impossible to eliminate without extraordinary disruption to our academic mission. Since it will be impossible to mitigate all of Colgate’s on-campus emissions in the foreseeable future, purchasing offsets to achieve climate neutrality demonstrates that the University accepts responsibility for the harmful effects its operations cause on global climate change. Purchasing offsets, could also spur mitigation efforts by creating a financial incentive for mitigation that would reduce the need to purchase future offsets.
The voluntary offsets market is mature with generally agreed-upon standards. Colgate can be confident that if it purchases offsets that are certified by one of several well-known institutions (e.g. Verified Carbon Standard), the offsets represent real reductions in global net emissions that would not have occurred without Colgate’s financing. The process of validating offset projects can be time consuming and complicated, suggesting that purchases of offsets will likely be more cost effective than if Colgate initiated its own emission reduction or sequestration projects, notwithstanding possible academic benefits and benefits to the local economy.
That said, we are especially interested in local offset projects. Presently, local options are generally small scale, more expensive, and could take years to develop and implement. Nevertheless, local offset projects remain an exciting option that we will actively explore in the coming months and years.
In FY 2012, Colgate entered into an agreement with Patagonia Sur for the purchase of 5,000 tons of offsets per year for 15 years. The project is a reforestation project in The Patagonia Sur Nature Reserve in the Palena province of southern Chile. Over the course of 15 years, approximately 225,000 native trees will be planted on roughly 428 acres of land which will become the Colgate University Forest. The Patagonia Sur reforestation project is acquiring Verified Carbon Standard (VCS) certification. Importantly, the agreement creates academic opportunities for students and faculty to conduct research within the Colgate Forest and The Patagonia Sur Nature Reserve in general.
Renewable Energy Certificates (RECs)
There are two distinct clean energy markets: the market for voluntary emissions reductions (VERs), also known as carbon offsets, and the market for renewable energy certificates (RECs) or green tags. RECs are specifically designed to mitigate Scope 2 emissions from electricity generation and consumption. RECs are characterized by the creation of renewable electricity whereby clean energy production displaces or reduces demand for more traditional carbon-intensive forms of energy. More specifically, RECs represent the environmental benefits (or attributes) received by the displacement of conventional fuel use, such as coal, oil or gas. One REC is representative of one megawatt-hour of electricity (1,000 kilowatt-hours) and allows the purchaser to support renewable energy production even though they themselves may not use the renewable energy.
Purchasing third-party certified RECs (such as Green-e) can be a cost-effective way for Colgate to mitigate its emissions associated with electricity consumption and presents another promising opportunity for Colgate to support renewable electricity generation while achieving climate neutrality by 2019. This opportunity is ripe for student research.
Currently, a third-party certified REC costs approximately $0.00133 per kWh in the most carbon-intensive region in the United States (the MRO-West grid). Colgate would need to purchase approximately 2,106,000 kWh worth of RECs in order to mitigate our 1,900 MTeCO2 associated with electricity consumption. This was determined using the EPA's Green Power Equivalency Calculator for the MRO-West region. If Colgate purchased just enough RECs to offset its emissions associated with electricity consumption, then this would cost the University approximately $2,800 annually.
Local Offset Projects
Colgate University is especially interested in local offset projects. Presently, local options are generally small scale, more expensive, and could take years to develop and implement. Nevertheless, local offset projects remain an exciting option that we will actively explore in the coming months and years.