Frequently Asked Questions For Businesses
Businesses and organizations of all sizes reach out to us with questions that often start with, “How can my business be carbon neutral?” These are our most frequently asked questions about the process. For general FAQs click here.
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Carbon Offsets for Business
- How do businesses and organizations use carbon offsets?
High quality carbon offsets, also known as carbon credits, are a common, credible, and cost-effective tool for reducing climate impact. They fit well within a portfolio of other emission-reducing programs.
Carbon credits counter (“offset”) the impact of greenhouse gas emissions caused by everyday activities. They are measured in metric tons (tonnes) of carbon dioxide equivalents (mtCO₂e). Each tonne emitted can be offset by buying one carbon credit since a carbon credit represents one tonne of emissions that was reduced somewhere else in the world. Laboratory and field testing with third party verification and site visits ensure successful calculation of greenhouse gas reductions in tonnes of carbon dioxide equivalents and enable a project to periodically issue credits.
Cool Effect specifically validates the additionality of the offset.
- How do businesses and organizations become carbon neutral?
- Businesses and organizations use carbon offsets to cancel out the portion of their emissions that cannot otherwise be reduced. This helps them become carbon neutral. Carbon offsets should only be purchased after other steps such as the purchase of renewable energy, conservation measures, changes to supply chains and other mechanisms to reduce emissions have been put in place.
- What are the steps to becoming carbon neutral?
There are 4 steps to becoming carbon neutral:
Step 1: Determine the carbon footprint
There are a variety of approaches to determining a carbon footprint. First, you must decide what approach works for your business or organization. Consider what internal resources do you have to devote to this task? What outcome would you like to communicate to your employees and customers?
Cool Effect works with businesses of all sizes and each has a unique journey to carbon neutrality.
- Large Fortune 500 companies may use a service such as The Climate Registry to help them document their entire operational footprint.
- Small and medium businesses can use The Cool Effect Business Calculator which was designed for organizations under 500 people
- Other businesses and organizations start by offsetting their corporate travel. Some use Cool Effect’s travel calculator and others have tools embedded in their software such as Concur.
- Some organizations want to offset an event
- Some organizations want to offset a specific part of their business such as shipping products.
If you are just getting started, determining your footprint can feel overwhelming. Start with a portion of your business that is manageable, so you are not paralyzed. If you are a large company with public commitments to sustainability goals, documentation will be important.
Step 2: Identify where emissions can be saved
Have you requested renewable energy? Even if it is not available in your area, the act of requesting it will raise demand.
Have you implemented sustainable programs for your employees and customers such as improved recycling, reduction in single-use plastic, paper and other potential waste, meatless meals, employee commuting incentives and conscious business travel?
Step 3: Buy high-quality carbon credits to offset emissions that cannot otherwise be reduced.
There are a range of carbon offsets on the market from low quality to high quality and it is very important that the buyer go to a trusted source to make sure only high-quality credits with true environmental integrity are purchased. For more information, download The Guide to Using Carbon Offsets for free.
Step 4: Share your certificate, badge, and story with employees and customers.
Research shows that others will be influenced by your actions and the planet will realize an even greater reduction in emissions
- What companies work with you?
Cool Effect partners with businesses and organizations of all sizes.
- Salesforce offsets corporate emissions and conferences
- Twitter offsets corporate travel and power usage of their data centers while they convert them to solar power
- Crunchbase offsets each employee and new hire
- American Airlines offers travel offset to their customers
- 3M offsets travel
- Lail Vineyards donates 10% to Cool Effect
- Dyper offsets shipping of each subscription
- Thistle offsets packaging and delivery
- The students of Millbrook School offset through their carbon neutrality committee
- What makes Cool Effect different than other carbon offset suppliers?
- We are a 501(c)3
- Our founders have 20 years of experience in the carbon market.
- We represent carbon offsets that meet our stringent requirements for verified science
- We offer full pricing transparency. No hidden fees. No proprietary trading.
- We offer only 100% additional carbon projects
- We are partners not with the projects we choose.
- We work with a limited number of large clients to ensure the highest quality and ongoing education.
- We are not project developers so we represent any project around the globe that meets our criteria without any conflict of interest.
- What is additionality and why is it so important?
The Environmental Defense Fund (EDF) and The World Wide Fund for Nature (WWF) define additionality as:
In the context of crediting mechanisms, emission reductions or removals from a mitigation activity are additional if the mitigation activity would not have taken place in the absence of the added incentive created by the carbon credits.
Additionality is the concept that without income from carbon credits the project could not exist. Quality credits (credits with environmental integrity) are real, permanent, correctly calculated, independently verified, and beyond a business-as-usual scenario. A project can only be considered to be additional if:
- it is not already legally required to do what it is doing
- it is not profitable without revenue from carbon offsets
- there are barriers that prevent its implementation regardless of profitability
- It does not employ technologies that are already in common use
For this reason, every Cool Effect project is extensively reviewed by experts in carbon project verification prior to its admission to the platform. Cool Effect even makes site visits to our projects to confirm project documentation.
- What is the process to work with Cool Effect?
One of our goals is to make climate action simple while also promoting sound science and full pricing transparency. Once you have your footprint, you can offset directly on the website or write to us email@example.com if you need an invoice.
We currently accept credit cards, Apply Pay, Google Pay and PayPal. You can also mail us a check or send an ACH or wire transfer. Once your payment is received, you will receive a payment confirmation and a personalize certificate which is yours to share as you chose.
- Do you offer bulk discounts?
- Cool Effect uses the power of our community to negotiate the best prices which represent bulk discounting. Then we offer those prices to everyone via our website. If you are interested in one-time purchases of 20,000 tonnes or more, some projects will offer a bulk discount or may have older vintages available that they are willing to sell for a discount. Please write to us at firstname.lastname@example.org for more details.
- Can you help us calculate our carbon footprint?
- Cool Effect has a variety of tools such as our Business Operations Calculator and our Travel Calculators. If these tools do not meet your needs, we recommend The Climate Registry for more detailed carbon footprints and documentation.
- Will you retire credits in our name?
- For purchases over 10,000 tonnes, we can request that the project retire the tranche with a reference to a specific name. It will read, “Retired by Cool Effect on behalf of [name].
- Do you sell RECs?
- No. We only offer high-quality carbon offsets.
- Can I buy credits and resell them to my customers?
- No. Once a purchase is made, the credit is retired to ensure no double counting. The carbon reduction belongs to the buyer.
- Why do businesses need carbon offsets?
- High-quality carbon offsets are an excellent means to reduce Scope 3 emissions (definition below) and can also assist in reaching corporate emission reduction goals while more substantive changes to operations are made. High-quality carbon offsets also offer multiple secondary benefits to local communities such as poverty reduction, sanitation, improved health, jobs and biodiversity.
- What are the definitions of Scope 1, Scope 2 and Scope 3 emissions?
These are emissions that arise directly from sources that are owned or controlled by the organization: for example, from fuels used in boilers or the vehicles that departments and facilities management own. These emissions can be avoided or reduced through improvements in efficiency and conservation.
These are the emissions generated by purchased electricity consumed by the organization. These emissions can be eliminated by switching to renewable (zero carbon) sources of energy.
These emissions are a consequence of the activities of an organization but occur from sources not owned or controlled by the organization. They include emissions associated with waste, water, business travel (including air travel, commuting, purchased goods and services and fuel) and energy-related activities not included in Scope 1 or 2. These emissions are generally not avoidable in any other ways and can be eliminated by offsetting.
- How much do carbon offsets cost? Why does each project charge a different amount for a tonne of carbon?
Carbon credits range from less than $1 to $45 per tonne of carbon dioxide equivalent (CO₂e). Most prices for well managed and regularly verified projects tend to be between $4 and $14 per tonne. In purely technical terms, a carbon offset is expected to reflect the costs to implement the project by US landowners, the amount of infrastructure required to execute the project or whether real, additional reductions of GHG emissions, and only that. However, the price can sometimes reflect whether or not additional benefits are included in your purchase. Prices will vary based on additional benefits that are included such as project social and environmental benefits as well as project location, age of credits and project type.
If projects are selling credits to the California Compliance market, minimum prices will be high due to the scarcity of these kinds of credits. Projects of consistent quality often command higher prices too. If a project sells for less than a few dollars per tonne it is hard to see how the sale of carbon credits can have a real impact on the project operations and buyers should beware of true additionality. For this reason, unless the reason for the low price is explicitly stated, we recommend skepticism for very cheap credits. However, Cool Effect has a stable of high-quality projects offering very competitive prices.
- What is Climate Neutral, Net Zero and Carbon Neutral? How does the IPCC define them?
A state in which human activities result in no net effect on the climate system (all GHGs + radiative forcing).
Net zero emissions (including emissions beyond carbon dioxide) are balanced by anthropogenic removals over a specified period of time (all GHGs).
Carbon Neutral or Net Zero CO2
When anthropogenic CO2 emissions are balanced globally by anthropogenic CO2 removal over a specified period of time.