What is carbon insetting and what opportunities does it offer?

Last updated: 6th April 2023

Carbon insetting is a form of direct investment which reduces greenhouse gas (GHG) emissions within the value chain of an organisation. How does it differ from offsetting? Where are the opportunities? Our experts answer these and other questions in this short article and factsheet.

Carbon insetting is a form of direct investment which reduces greenhouse gas (GHG) emissions within the value chain of an organisation. This could be upstream within the suppliers, or downstream in the emissions footprint which passes out of the organisation like waste and transportation.

These projects have measurable reductions in the GHG footprint of the organisation, and may have additional economic, social, health or environmental benefits within the supply chain and the communities with which they are connected.


How is it different from offsetting?

Most of the characteristics and process are the same (see our Carbon Offsetting factsheet), but instead of buying verified carbon credits from an unrelated third party source, the organisation is involved in developing the GHG reduction within its sphere of influence.

The GHG emissions reductions are still verified by an independent auditor, but instead of trading the credits they are taken on by the organisation and balanced directly against their unavoidable emissions.


Where are the opportunities?

To determine your organisation’s opportunities for insetting, you first need to calculate your GHG emissions, with particular emphasis on Scope 3 (indirect emissions from the value chain). This will tell you what types of activities, done by others on your behalf, represent the highest proportion of emissions. 

For many organisations this will be in Purchased Goods and Services (category 1 of Scope 3), but transportation, waste and other categories may be significant for your individual organisation.

In supply chain operations:

Changes to equipment, infrastructure, facilities or processes could have great potential for reducing GHG emissions but be impossible for suppliers to implement swiftly without outside investment. 

If many organisations are using the same supplier, you could collaborate on an emissions reduction project, spreading the investment and sharing in the emissions reductions. 

In supply chain communities:

Depending where your value chains are located geographically, you may be able to identify locations or communities which are part of your value chain’s connected environment. Examples could include agricultural areas you purchase from, the neighbourhood of a key supplier factory, the community from which a supplier’s employees are drawn. 

The opportunities for GHG emissions reduction (or removal) within a geographical zone would be determined by a consultation with the community to agree on both the types of projects which would be suitable and the perimeter of the zone which is influenced by your organisation and its value chain.

If you’d like to find out more about insetting, including answers to questions such as: 

•   How do we know what will make a difference?

•   How is it measured?

•   Do we have to do it all ourselves?

•   Why not just offset?

Please request our insetting factsheet here.

Call now to discuss how insetting fits into your Net Zero plans: 0800 6127 567 or email george.richards@jrpsolutions.com.


N.B. The information contained in this entry is provided by the above supplier, and does not necessarily reflect the views and opinions of the publisher

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