Carbon Offsetting for Methane Reduction and Capture

Jenna Zhang
AlliedOffsets
Published in
2 min readAug 24, 2021

Unburned methane released into the atmosphere has more than 80 times the warming power of carbon dioxide. Methane gas is unique in that, despite having a shorter lifespan than other greenhouse gases, it’s more effective at trapping heat. However, burned methane is the cleanest burning fossil fuel and when produced from non-fossil sources, it can even remove carbon from the atmosphere.

How do methane projects work?

Methane is emitted from the production and transport of coal, natural gas, and oil, livestock and agricultural practices, and the decay of landfill waste. But, this methane can be captured before it reaches the atmosphere using digesters. Digesters are big tanks that store the products of methane emission, such as manure or trash, and collect the emitted gas produced during decomposition. The collection is then burned to produce heat or generate electricity, utilizing the burned methane benefits as previously mentioned.

How landfill methane projects work — as explained on EPA.gov.

Data deep-dive

We went through the AlliedOffsets database to find all projects that specifically mention ‘methane’ in their name to see how they are distributed among methodologies, countries, and more.

‘Methane’ projects by sector.

The chart above shows the types of projects that fall within the ‘methane’ search criteria. Not surprisingly, waste disposal (primarily landfill gas) accounts for the largest share of such projects. And most of them are on CDM, though there are over 104 projects on Verra that mention ‘methane’ in the title:

CDM leads the way for methane projects.

When it comes to pricing, our estimates put the average wholesale price for credits from a methane project at $2.18 per tCO2e. The chart below showcases the countries with the most expensive carbon credits for these types of projects.

Russia and UK are tied at an average estimated wholesale price of $5.78.

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P.S. Curious to know what Forestry and Land Use project came through in this data? It’s the Verra project System of Root Intensification (SRI) Programme: Reduction of Methane Emissions and Water Consumption in Rice Field of India; it’s never issued or retired any credits.

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