Voluntary carbon offsetting and its contribution to sustainable development
File(s)
Author(s)
Tan Loh, E Feng
Type
Thesis
Abstract
Over the last decade, an increasing number of organisations are voluntarily offsetting their greenhouse gas (GHG) emissions through the voluntary carbon market (VCM). By investing in offset projects that deliver a range of co-benefits such as technology transfer, poverty alleviation and environmental conservation, voluntary carbon offsetting also helps promote sustainable development (SD). Proponents of the VCM often claim that the unregulated nature of the market, coupled with the unique motivations of its buyers provide it a greater capacity than the compliance Clean Development Mechanism (CDM) in promoting SD. However, these presumptions are yet to be empirical demonstrated. The purpose of this study is to assess the demand and supply of SD co-benefits in the VCM in order to challenge or validate these presumptions.
On the demand-side, stated preference (SP) survey results show substantial willingness-to-pay (WTP) exist among organisations for offset co-benefits, in the order of co-benefit verification, social co-benefit, economic co-benefit and environmental co-benefit. Furthermore, the WTP of organisations that are offset users are stable over a period of two and a half years (except for their WTP for environmental co-benefit, which has increased over the period). Significant WTP for offset co-benefits also exist among organisations that are offset non-users, thus promotion of offset co-benefits can encourage their future participation.
On the supply-side, based on a novel database of voluntary projects, this study found despite the VCM promotes a range of offset projects, it is at risk of being dominated by a few large-scale Land Use, Land Use Change and Forestry (LULUCF) projects. As SD contributions of LULUCF projects are uncertain, whether the VCM promotes SD remains inconclusive. This study also found the VCM is supporting a great number of pre-CDM projects, which undermines its capacity in mobilising further climate finance beyond compliance regimes to promote SD.
On the demand-side, stated preference (SP) survey results show substantial willingness-to-pay (WTP) exist among organisations for offset co-benefits, in the order of co-benefit verification, social co-benefit, economic co-benefit and environmental co-benefit. Furthermore, the WTP of organisations that are offset users are stable over a period of two and a half years (except for their WTP for environmental co-benefit, which has increased over the period). Significant WTP for offset co-benefits also exist among organisations that are offset non-users, thus promotion of offset co-benefits can encourage their future participation.
On the supply-side, based on a novel database of voluntary projects, this study found despite the VCM promotes a range of offset projects, it is at risk of being dominated by a few large-scale Land Use, Land Use Change and Forestry (LULUCF) projects. As SD contributions of LULUCF projects are uncertain, whether the VCM promotes SD remains inconclusive. This study also found the VCM is supporting a great number of pre-CDM projects, which undermines its capacity in mobilising further climate finance beyond compliance regimes to promote SD.
Version
Open Access
Date Issued
2018-04
Date Awarded
2018-10
Advisor
Kountouris, Ioannis
Sponsor
International Carbon Reduction and Offset Alliance (ICROA)
Publisher Department
Centre for Environmental Policy
Publisher Institution
Imperial College London
Qualification Level
Doctoral
Qualification Name
Doctor of Philosophy (PhD)