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By Robert Rapier on Jan 10, 2008 with no responses

FTC Investigates Carbon Offsets

I am still on the road, but wanted to quickly stick something fresh up for discussion.

I have long been suspicious of the whole carbon offsets business (and frankly, it reminds me of buying indulgences). The FTC apparently shares similar concerns:

F.T.C. Asks if Carbon-Offset Money Is Well Spent

Corporations and shoppers in the United States spent more than $54 million last year on carbon offset credits toward tree planting, wind farms, solar plants and other projects to balance the emissions created by, say, using a laptop computer or flying on a jet.

But where exactly is that money going?

The Federal Trade Commission, which regulates advertising claims, raised the question Tuesday in its first hearing in a series on green marketing, this one focusing on carbon offsets.

As more companies use offset programs to create an environmental halo over their products, the commission said it was growing increasingly concerned that some green marketing assertions were not substantiated. Environmentalists have a word for such misleading advertising: “greenwashing.”

The FTC also raised questions about how carbon offsets are being calculated:

Most suppliers of carbon offsets say that the cost of planting a tree is roughly $5, and the tree must live for at least 100 years to fully compensate for the emissions in question. By comparison, an offset sold by Dell for three years’ use of a notebook computer costs $2.

To supply and manage the carbon offsets, big consumer brands are turning to a growing number of little-known companies, like TerraPass, and nonprofits, like Carbonfund.org. These intermediaries also cater to corporations that want to become “carbon-neutral” by purchasing offsets for the carbon dioxide they release.

Ms. Majoras of the F.T.C. pointed out that spokesmen for events like the Super Bowl and the Academy Awards have recently started saying that their events are carbon-neutral (though the Academy Awards drew criticism for the way its offsets were handled).

The F.T.C. has not accused anyone of wrongdoing — neither the providers of carbon offsets nor the consumer brands that sell them. But environmentalists say — and the F.T.C.’s hearings suggest — that it is only a matter of time until the market faces greater scrutiny from the government or environmental organizations.

I suppose I will be carbon-neutral for the rest of my life, as I planted a couple hundred trees two years ago (for a United Way function). I can now get that Hummer without feeling guilty about it. Oh, and if you want to be carbon-neutral, just send me a check and I will plant a tree for you. :-)