Need to Know: Greenwashing and the Voluntary Carbon Credit Market

If you’ve been following the news, you’ve probably seen reports exposing the large-scale “greenwashing” campaigns used by major companies. 

These companies falsely claim to be reducing, or even eliminating, their carbon footprint by purchasing fabricated, unverified, or deliberately miscalculated carbon credits. 

As a result, concerns about greenwashing are making both individuals and businesses wary of using carbon credits to offset emissions, especially since the voluntary carbon credit market remains somewhat unregulated.

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What Are Voluntary Carbon Credits?

Organizations or people who participate in the voluntary carbon credit market choose to offset their operation’s emissions by purchasing carbon credits—they are not required to do so by law. 

Why? While many may be motivated by a genuine desire to protect the environment, others simply want the positive PR associated with “going green.”

In the voluntary market, carbon credits are the traded commodity. The credits represent a removal or reduction of the greenhouse gas emissions produced by an individual or operation.

Common types of projects that offer carbon credits include renewable energy, reforestation, and methane capture. 

This Sounds Great. What's the Issue?

Credibility and transparency. In order to prove the credibility of a carbon offset, the project must prove “additionality.” “Additionally” means the emissions removal or reduction achieved by the project would not have happened without the  financial support of the carbon credit.

Unfortunately, insufficient proof of additionality is a major issue in the voluntary carbon credit market, which means that some carbon credit projects don’t actually represent a reduction of emissions.

Additionally, not all carbon credit projects are created equal. Some carbon credits in the voluntary market lack verification or monitoring standards. This results in low-quality offsets that do little to protect the environment, or a misleading record of how many carbon credits were actually purchased. 

This lack of both credibility and transparency results in disingenuous or inflated impact claims, which make it difficult to prove that carbon credit projects are legitimately benefiting the environment. 

The Future of Ethical Carbon Offsets

As of now, consumers who want to support sustainable businesses are left with little information regarding the truth behind a company’s claims of “carbon neutrality” or reduced carbon emissions. And time and time again, consumers unknowingly financially support a business based on misleading sustainability claims.

That is what Element United is working to change. By utilizing blockchain technology, Element is working with mine partners to tokenize their carbon credits. 

This means every carbon credit purchased by a mine partner would  be recorded on the blockchain. This ensures transparency, immutability (no more double-counting or misrepresenting of the amount of carbon credits purchased) and proof of “additionality” within the voluntary carbon market.

Individuals who want to join our mission can purchase an Element Node. Nodes are special pieces of software that verify and record transactions on the blockchain. This makes it possible to confirm and track the validity of tokenized carbon credits. 

You can learn more about Element Nodes here, and make sure to follow us on Twitter and Discord for the latest updates on our projects. 

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Element United Disclaimer 

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The views expressed in this material do not necessarily reflect those of Element United DAO LLC. The information provided is solely for educational purposes and should not be considered as financial advice. We strongly encourage individuals to conduct their own research and exercise independent judgment before making any financial decisions. Element United DAO LLC holds no responsibility for any actions taken based on the information provided.