How Are Carbon Credits Different From Carbon Offsets?

Both are important mechanisms for climate policy, but they are not the same

Climate change may be the theme of the century, but there is still much ambiguity on climate change policy, especially when it comes to the difference between carbon credits and carbon offsets. Both tools are very popular nowadays, as businesses and individuals strive to reduce their carbon footprints. But, although they are often used interchangeably, both terms are quite different.

Understanding how carbon credits and carbon offsets differ and how they work can provide an ample understanding of how governments, private entities, and individuals are joining each other to mitigate climate change — and how you can take part in it, too.

Overall, both carbon credits and carbon offsets can be seen as mechanisms for climate accounting. They are ways to balance the scales of greenhouse gas (GHG) emissions and counteract human contribution to climate change.

They may sound technical in nature, but carbon credits and carbon offsets are pretty straightforward. They follow one basic tenant: the Earth is one. Carbon dioxide and other GHGs produced somewhere on our planet can be counteracted through measures that take place elsewhere. Together, they can yield either…