In an eco-sensitive world, Reckitt Benckiser PLC, the globe's largest manufacturer of cleaning products, wanted to spruce up its image. The U.K.-based company set out to offset the carbon dioxide (CO{-2}) emissions it produces in its manufacturing processes.
Who would have thought the company would find a green solution in the wilds of beautiful British Columbia?
By planting 2 million lodgepole pine, Douglas fir and white spruce trees on 15 square kilometres of once-forested land in northern B.C., the manufacturer of Lysol and Electrasol buffed its environmental credentials. However, like most manufacturers, the company continues to create the primary greenhouse gas that drives global warming.
"Canada, and B.C. specifically, was the right place at the right time in terms of best meeting our needs for the project and, we believe, making a positive contribution to the local economy and the environment," says Edward Butt, environmental director for Reckitt Group.
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The goal was to make the company "carbon neutral" by planting enough trees to absorb more than 1 million tons of CO{-2} over the next 80 to 100 years -- though over the next century the trees will offset only two years' of carbon output from Reckitt Benckiser factories. The company says it has also taken steps to reduce the carbon emissions it produces in the manufacturing process.
Reckitt is one of a growing number of companies and organizations that are declaring themselves carbon neutral by buying carbon-offset credits -- equal to the amount of CO{-2} they produce -- that result in tree planting or the support of renewable energy and energy efficiency projects.
BskyB Ltd., a British satellite-television company chaired by Rupert Murdoch and run by his son, James, recently declared itself carbon-neutral. The Olympics, World Cup soccer, the Super Bowl and other major sporting events have done the same. Even the World Bank has committed to the label.
Airlines are offering customers the option to offset the greenhouse gases produced during their flights. Hotels are providing carbon-neutral accommodations. Even rock bands such as the Rolling Stones and Coldplay have offset the emissions associated with their concerts and albums.
However, the fact remains: Companies that call themselves carbon neutral might actually be belching CO{-2} into the environment. Some environmentalists say carbon trading is a shell game that allows industries to avoid reducing their own carbon emissions.
Others say it's a good thing.
At least, "it's the start of a good thing," says Ron Dembo, co-author of the soon-to-be-released book Everything You Wanted to Know About Offsetting But Were Afraid to Ask. He is also president of ZeroFootPrint Inc., a non-profit organization based in Toronto that provides information and services to companies seeking to reduce their environmental impact.
"Carbon offsetting isn't the long-term solution to climate change -- stopping the burning of fossil fuels and deforestation is," Mr. Dembo says. "But offsetting offers an interim solution that can have a significant impact on global warming."
Even the Reckitt Group's Mr. Butt agrees that carbon offsets aren't a panacea. "Whilst we're very proud of our Trees for Change project, it's important for people to understand that planting trees to offset emissions is not the answer to tackling climate change," he says. "We are taking real action to tackle climate change at source, both across our business and in consumer use of our products."
For example, since 2000, the company has reduced CO{-2} emissions from its manufacturing facilities by about 20 per cent per unit of production, and has installed solar panels on its factories in Italy and Korea. Three of its factories in Europe are powered by high-efficiency, combined-heat-and-power energy plants.
Because offset schemes cost money to set up and maintain, they put a clear price on carbon emissions. That, Mr. Dembo says, "is one of the most important contributions that offsetting can make in the long-term struggle against climate change."
Carbon offsets are a practical way to do something about emissions, says the David Suzuki Foundation, a Vancouver-based environmental group. In addition, purchasing offsets from projects such as wind farms helps support the transition to a sustainable or renewable energy economy.
However, the foundation does not want voluntary offset programs to be seen as a substitute for comprehensive government regulations designed to reduce greenhouse gases.
Carbon offset credits can be traded on the open market. According to the World Bank, transactions in the first nine months of 2006 totalled more than $21.4-billion (U.S.), almost double the amount in all of 2005.
While Reckitt can offset carbon credits by planting trees in British Columbia, Canadian companies are not allowed to participate in international emissions trading. The federal government is, however, considering allowing participation in the Kyoto accord's clean-development mechanism, which allows companies to gain offset credits by investing in developing countries to give them access to environmental technologies, says Environment Minister John Baird.
Some Canadian businesses are jumping on the green bandwagon nonetheless.
Wedgewood Hotel & Spa in Vancouver recently entered into an agreement with Planktos Inc., an eco-restoration firm in San Francisco, to purchase sufficient carbon credits to make the Wedgewood carbon neutral. Planktos, a for-profit company, generates carbon offsets by restoring plankton populations in the world's oceans and by planting new forest parks.
Each Planktos carbon credit represents one tonne of CO{-2} that has been removed from the environment, and Wedgewood has contracted to purchase 5,000 tonnes, a 10-year supply, of carbon credits.
In 2003, the Monterey Inn Resort, an Ottawa hotel and conference facility, was certified as Canada's first carbon-neutral company. The hotel calculated the energy used for heating, electricity and employee commutes, then converted the figures into tonnes of carbon dioxide. The Tree Canada Foundation calculated the carbon offset: the planting of 1,000 trees. The hotel had 5,500 trees planted.
With the pressure on companies to go green, Mr. Dembo says, we will see an increase in "greenwashing," companies pretending to be environmentally friendly when in fact they are not. But he warns that companies will be exposed and will feel a public backlash if they attempt to deceive consumers.
"We've reached a green tipping point. Green has become 'in' but not in a fad way," Mr. Dembo says. "The business of this century is turning the world green. Instead of putting our head in the tar sands, let's embrace it."
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Going carbon neutral
Companies achieve carbon-neutral status by reducing emissions through energy conservation and transportation adjustments, then offsetting any remaining greenhouse gases by purchasing carbon credits. For instance, if a company adds carbon emissions to the atmosphere, it can "subtract" them by financially supporting wind farms, solar energy installations, tree planting or other projects. This is done on the carbon trading market and often involves investing in projects in other countries. If a company purchases credits equal to the carbon it produces, it can declare itself carbon neutral.
PAUL LIMA
