Carbon credits are pollution permits for the rich

A farmer collects sorghum plant after heavy rain in Kournari village, on the outskirts of Ndjamena, Chad October 26, 2022. REUTERS/Mahamat Ramadan

A farmer collects sorghum plant after heavy rain in Kournari village, on the outskirts of Ndjamena, Chad October 26, 2022. REUTERS/Mahamat Ramadan

Offsets allow companies and countries to make ‘carbon neutral’ claims without taking real steps to decarbonise

Mohamed Adow is a climate justice advocate and director of energy and climate think-tank Power Shift Africa.

Carbon credits have long been mistakenly portrayed as a silver bullet that will both reduce greenhouse gas emissions and fund global development. But critics warn they are merely a cover for rich companies and countries to carry on polluting. 

Recently, those critics were proven right again. Reuters reported that a leaked document from staff at a corporate watchdog that audits companies’ climate plans said that “some or most emission reduction credits are ineffective in delivering emissions reductions”.

For years, climate policy experts have warned that carbon credits are dangerous because they allow companies and countries to make claims of being ‘carbon neutral’, or even ‘carbon negative’, while taking no steps to decarbonise their polluting activities.

This undermines climate action around the world by offering free passes to whoever is willing to buy credits. It could result in less action to cut emissions, not more.

A man carries thatch, which he will use for the roof of his hut, back to his campsite which lies deep in the forest near the city of Mbandaka, Democratic Republic of the Congo, April 3, 2018
Go DeeperWith Africa's carbon sinks up for grabs, offset debate heats up
Delegates attend the voluntary auction of carbon credits, with projects in Kenya, Rwanda, Egypt and South Africa, at the auction in Nairobi, Kenya June 14, 2023. REUTERS/Thomas Mukoya
Go DeeperWill the voluntary carbon market survive mistrust and regulation?
Go DeeperClimate disclosure rules are expanding. Companies need to keep up

Carbon credits act as pollution permits for the rich. A high-emitting company in the United States, for example, can avoid genuine efforts to reduce its own emissions by buying cheap carbon credits to ‘offset’ its dirty activity.

The cheap credits effectively pay countries in Africa and other places not to emit greenhouse gases and allow the US company to carry on as before. This payment is a fraction of the true costs the countries will suffer from climate change. 

But these financial crumbs are not bringing transformational development to Africa, nor are they bringing about the structural changes needed for polluting Global North economies to tackle the climate crisis.

That is why they are so enthusiastically backed by rich countries and business interests, who recognise them for what they are: a greenwashing trick to carry on business as usual, without making fundamental changes to reduce emissions. 

Carbon credits falsely assume emissions from burning fossil carbon (currently safely stored deep underground) is interchangeable with carbon temporarily stored in biological systems like trees.

Yet projects such as ‘avoided deforestation’ or tree planting are not permanent. The carbon stored there is released when trees burn or land degrades. As harmful emissions continue, climate change gets worse, leading to more forest fires that release stored carbon – which nullifies offsetting measures. Even a child can understand the difference between carbon stored securely under a seabed and the fragility of carbon stored in a tree.

Getting emissions to actual zero is the only way we are going to secure a safe and prosperous planet. Carbon credits delay that transition and put people in developing countries at greater risk. Delayed action on climate change will hurt us all, but it will cause greatest suffering in the Global South.

These ‘carbon markets’ also fail on delivering development. Africans need food, clean energy, and economic growth. Carbon markets exist as an accounting mechanism to tick off supposed carbon reduction as cheaply as possible. They are not focused on meeting genuine development needs such as food sovereignty, secure energy access and decent work.

Carbon credits are a neo-colonial construct that once again turns Africa and the Global South into a commodity from which the Global North can extract value. They are the tranquilising drug delaying real progress on climate change. We must treat them as such.

When insiders at the corporate climate watchdog admit the carbon credits system is broken, it exposes them for what they really are: a greenwashed bullet, not a silver one.

Any views expressed in this opinion piece are those of the author and not of Context or the Thomson Reuters Foundation.


  • Net-zero
  • Climate policy
  • Carbon offsetting

Get our climate newsletter. Free. Every week.

By providing your email, you agree to our Privacy Policy.

Latest on Context