Feel less than green? Buy back your pollution

By ANDREA JAMES
P-I REPORTER

It sounds simple. Buy a cross-country flight, and pay extra to "offset" the greenhouse gases generated by the airplane. Or buy a pair of skis -- and add 50 cents to your purchase to clean the environment, too. Just like that, you're carbon-neutral.

A couple of years ago, most people had never even heard of a carbon footprint -- the amount of pollution generated through electrical use and travel. Today, it seems everyone from the Dave Matthews Band to Ford Motor Co. is throwing dollars at environmental firms that promise to help Americans go "carbon-neutral."

The trend is taking off in Seattle and around the country as increasing numbers buy "carbon offsets" -- intangible financial transactions that subsidize renewable energy projects, or pay for tree planting or some other eco-friendly activity. The U.S. plays only a small role in the global carbon trading market -- which has more than doubled to $22 billion in the first nine months of 2006, according to The World Bank.

Corporations of all types are getting involved. For example, Seattle non-profit NetGreen has joined with local real estate companies to offer "carbon-neutral mortgages," billed as the first of their kind in the country. For $180 per year, homeowners can offset the pollutants generated from heating the house.

Recently, Bellevue-based Expedia.com began allowing consumers to "fly green" at $6 for a short flight to $30 for international travel.

And just last week, Seattle-based EvoGear began allowing customers to add 50 cents to their online purchase to offset the carbon dioxide generated by shipping ski equipment.

"We do ship so many packages, and that does have an environmental impact," said Nathan Decker, EvoGear's senior manager of e-commerce. "The concept of offsetting one's carbon footprint is such an effective way to spread awareness and get people thinking about how they are making an environmental impact with their choices."

The business of climate change is heating up -- along with the planet -- so fast that many ordinary folks are left wanting to do right but wondering where their money goes. The emerging carbon-offset industry has little oversight or transparency, so it's difficult for consumers to see if they are really being a "hero" by going "zero" -- as Travelocity preaches on its Web site -- or being suckered.

There's no quick and easy way for consumers to see exactly how the money is spent.

"One challenge in this arena is we're still developing the infrastructure for consumers to have confidence that they're getting something good," said Dale Bryk, a senior attorney at the Natural Resources Defense Council in New York.

There won't be much oversight until the federal government limits emissions through a cap and trade program -- like the Regional Greenhouse Gas Initiative that's already being developed in the Northeast, she said.

But in the meantime, the public is frustrated as it watches Earth's temperature rise. Companies such as EvoGear are tapping into that frustration to give people a way -- albeit small -- to get involved.


Saving the planet -- sort of

Just because someone pays to offset a ton of carbon pollution doesn't mean that a ton is taken out of the atmosphere. Also, offsetting a ton of carbon dioxide doesn't even mean that is the gas being offset. Everything is converted to carbon -- meaning that one molecule of methane, a really bad gas -- is equal to 23 molecules of carbon dioxide -- a somewhat bad gas.

Companies such as Expedia.com and EvoGear pass 100 percent of donations to another firm that sells carbon offsets. Such firms can be either for- or non-profit and charge between $4 and $30 to offset 1 metric ton of carbon.

After the money leaves an individual's hands, it is routed through a complex network of financial transactions, some through the Chicago Climate Exchange, until some portion ends up paying for something such as a wind farm in South Dakota or a solar home in Chicago.

In the past six years, the number of firms selling carbon offsets has grown from a few to about 40 worldwide, based on estimates from people in the industry. The number of new firms popping up has outpaced the infant industry's ability to regulate them or create a universal carbon-offset standard.

"Sometime after Hurricane Katrina -- although I don't know that that was the event -- everything changed," said Eric Carlson, executive director of Carbonfund.org. "Everyone acknowledges climate change is happening."

The Silver Spring, Md.-based non-profit has seen its revenue jump tenfold in the past year to $700,000, said Carlson, who attended the University of Puget Sound.

"It's been crazy," he said. "The ability to reduce your climate impact to zero is empowering people at a very basic level."

To date, the non-profit says it has offset 220 million pounds of carbon dioxide, the equivalent of taking 20,000 cars off the road, he said. Some people have even offset their entire lives -- which costs about $4,000.

Expedia.com customers also have jumped on board.

"It's been really successful. It's surpassed our expectations," said Expedia.com spokeswoman Katie Deines. Cumulatively, the travel Web site's customers have offset more than 11 million pounds of carbon-based emissions.

But none of that really means that millions of pounds of carbon dioxide are gone from the air -- those gases are still up there trapping the sun's rays and heating the planet.

Instead, it means that steps have been taken to reduce emissions in the future, including investment in technologies that are supposed to decrease dependency on coal-generated power. The goal isn't to clean the air right now, but rather to reduce future emissions by making cleaner energy cheaper to produce, Carbonfund.org's Carlson said.

"We're making it easy and affordable for any individual or business to reduce their climate impact," Carlson said. "If we're able to drive the price of wind energy below that of coal, you'll see this groundswell of investment into clean technology, not because of the environmental benefit, but because of straight economics."


A different view in Europe

The carbon-offset industry has many skeptics -- particularly in Europe, where the government caps emissions and offsets are seen as buying indulgences.

One critic says it's a con because carbon neutrality is a scientific farce, according to Adam Ma'anit, co-editor of British publication New Internationalist Magazine, which dedicated an issue to the subject called CO2nned.

"For about $150 you could make a Hummer a zero-emissions vehicle just by buying offsets," he said.

"Of course, the reality is you are still driving an insanely inefficient car and belching carbon like you were a finalist at the Texas annual chili eating festival every time you pop down to the local Wal-Mart for some Hot Pockets."

A recently released book in Sweden criticizes the carbon-trading method used under the Kyoto Protocol and in the European Union, saying that it prolongs the world's dependence on oil, coal and gas.

Those groups oppose the concept because carbon offsets don't clean the environment directly.


Anyone in charge?

The carbon-offset industry has little official oversight. The Environmental Protection Agency doesn't specifically endorse carbon offsetting, though it runs a climate program in which companies can buy offsets in lieu of reducing emissions.

But many carbon-offset sellers want regulations to reassure the public, according to Tom Arnold, chief environmental officer at Menlo Park, Calif.-based TerraPass, which has partnerships with Expedia.com and Ford.

Many carbon-offset groups also buy and retire carbon dioxide emissions reductions from the Chicago Climate Exchange. Retiring the credits means that an industrial polluter can never buy them, said Billy Connelly, spokesman for Charlotte, Vt.-based NativeEnergy, whose customers include Al Gore and Dave Matthews.

Right now, the retired credits are meaningless in the U.S., because the country doesn't cap its total emissions output. But if regulations are put in place -- it's only a matter of time, experts say -- the retired credits will prevent polluters from buying allowances, and they would have to reduce their emissions.

Also, independent auditing groups are evolving. The San Francisco-based Center for Resource Solutions is developing a certification program for carbon reductions similar to its Green-e program that is used to verify renewable energy certificates.

The group hopes to have a standard complete by early 2007, said Lars Kvale, an analyst with CRC. The certification will assure consumers that their purchase is valid.

Encouraging people to buy offsets raises awareness -- which is half the battle, proponents say.

Fremont real estate agent Ryan Neff has bought into the carbon-offset craze and maintains that he's not someone who's been suckered. At first he struggled with the concept of buying out his own pollution. "I've always considered myself to be an environmentalist," Neff said. "I didn't like the fact that a large part of my job involved driving around."

Neff, 35, and his team of Windermere agents donate a portion of their commissions to Carbonfund.org.

"I certainly don't think you can buy some carbon offsets, feel good about yourself and forget about the problem," said Neff, who has a master of business administration degree from the University of Washington. Neff has installed a more efficient furnace and water heater at home. "What I can't eliminate, I can offset."


WHAT IS THE CHICAGO CLIMATE EXCHANGE?
The United States, the world's largest polluter, does not put a limit on its emissions. In the business world, that means there's not much financial incentive to limit emissions, and big polluters don't have to buy allowances as they do in other nations.

However, an entire financial industry has sprung up around the cap and trade model through the Chicago Climate Exchange.

Hundreds of corporations, organizations, states, counties and cities have signed legally binding agreements promising to limit their emissions by 2010. Thus, they've created a voluntary cap and trade system that functions the same way a government regulation would.

The Chicago Climate Exchange, or CCX, is regulated by the NASD, the world's largest private body that regulates financial services. Polluters, clean-energy companies and everyone in between can trade carbon offsets and allowances similar to stocks in the stock market.

King County is a member of the CCX, meaning that it has promised to reduce emissions by 6 percent by 2010. If it does, it can sell credits. If it doesn't, it will have to buy allowances. The city of Seattle has not signed on.


GREENHOUSE GASES
Industry experts sometimes use the term "carbon" to describe a variety of greenhouse gases, though not all of them are carbon-based. The main greenhouse gases generated by humans are:


Carbon dioxide: Produced by burning oil, natural gas and coal, solid waste, wood products and in chemical reactions. It can be removed from the atmosphere by plant absorption.

Methane: Emitted in the production and transport of coal, natural gas and oil. Also comes from organic decay and from livestock.

Nitrous oxide: Emitted in agricultural and industrial activities and through fossil fuel and solid-waste combustion.

Fluorinated gases such as hydrofluorocarbons, perfluorocarbons and sulfur hexafluoride: Synthetic greenhouse gases emitted from industrial processes. They also deplete the ozone layer.
Source: Environmental Protection Agency


P-I reporter Andrea James can be reached at 206-448-8124 or andreajames@seattlepi.com.