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Carbon Offset VS Carbon Inset- What's the Difference?

Purchasing a carbon offset that sequesters carbon is one approach to counteract the amount of net greenhouse gas emissions emitted into the atmosphere. However, the business of carbon offsets is a multidimensional marketplace that differs in strategy, goal, and impact (from concept to delivery).  

While carbon offsets facilitate a quantifiable and standardized framework for organizations to confront and redress their carbon emissions, as climate change continues to cause dramatic peaks and drops in data points, the interplay between business and environment is becoming more convoluted than ever. This calls for an additional measure, i.e., carbon insetting.  

What is Carbon Insetting?  

Carbon insetting is a notion that holds a different route to carbon offsetting assisting businesses in meeting their emission reduction targets with a different approach. As opposed to offsetting which involves the creation and sale of tradable assets, carbon insetting is a proactive strategy for lowering emissions firsthand and measuring the cutbacks within the company's internal carbon footprint. Insetting involves evaluating, lowering, and offsetting the carbon footprint of a company by generating significant socio-environmental programs well within its value chain and employing them to establish a sustainable setting. Inset, in a nutshell, is the process of aligning businesses with nature within the internal operations of the organization itself.  

  • Securing supply chain and procurement.  
  • Resources and ecological footprint management.  
  • Strengthening organizational goals  
  • Empowering employee  
  • Improving product quality  
  • Involving & engaging with customers/ clients/ suppliers.   

Carbon insetting makes use of corporate investment to encourage sustainability initiatives and directly lower an organization’s carbon emissions. Among the most used approaches in carbon insetting initiatives includes pro-diversity steps such as environmental protection, agroforestry-related, etc.  

What is The Process of Carbon Offsetting?

 

Carbon insetting occurs in regenerative agriculture when farmers employ practices that trap carbon in the soil and lower carbon footprint. The employment of agricultural methods such as cover crops, reforestation, low or no-till farming, nitrogen delivery, etc., contribute to carbon sequestration. Meaning, smallholder farmers help trap atmospheric carbon from the atmosphere, sequestering carbon and reducing GHG (greenhouse gas) emissions. But, of course, farmers receive funds in exchange for providing raw ingredients to the investment organization and producing demonstrable socio-environmental outcomes in their areas. However, farming communities are a diverse group of small businesses, each with its carbon footprint— scalable and innovative systems are required to effectively integrate carbon insetting. 

 


What is The Process of Carbon Offsetting?

 

Carbon insetting occurs in regenerative agriculture when farmers employ practices that trap carbon in the soil and lower carbon footprint. The employment of agricultural methods such as cover crops, reforestation, low or no-till farming, nitrogen delivery, etc., contribute to carbon sequestration. Meaning, smallholder farmers help trap atmospheric carbon from the atmosphere, sequestering carbon and reducing GHG (greenhouse gas) emissions. But, of course, farmers receive funds in exchange for providing raw ingredients to the investment organization and producing demonstrable socio-environmental outcomes in their areas. However, farming communities are a diverse group of small businesses, each with its carbon footprint— scalable and innovative systems are required to effectively integrate carbon insetting. 

 

The Difference Between Carbon Insetting and Carbon Offsetting

Carbon offsetting and carbon insetting are related, but in a “sisters not twins” way. Carbon insetting is where business operations that result in a lower carbon footprint occur inside the framework of the value chain. Carbon offsetting, on the other hand, is where organizations purchase carbon offsets to compensate for their carbon emissions. 

  • Carbon offsetting refers to greenhouse gas emissions reductions that are not inextricably linked to a company's active or passive activities. 
  • Carbon insetting refers to GHG reductions that are directly attributable to a company's active or passive operational processes. 

For the longest time, businesses have been utilizing carbon offsets to counterbalance their inevitable greenhouse gas (GHG) emissions through carbon offsetting. However, during the last few years, a concept known as 'insetting' has emerged as a way of resolving an organization's carbon emissions within its distribution network. 

Carbon insetting entails far more than simply lowering a company's carbon footprint. It is companies investing in the ecosystems that their suppliers rely on to boost their sustainability. It is also about giving social facilitation and demonstrable benefits to the communities that encompass the value chain.

Organizations, today, see insetting as a realistic and beneficial approach for meeting global climate targets of 1.5 degrees Celsius, net-zero emissions, and the Sustainable Development Goals.

 The other differences:

  • Carbon offsetting refers to the carbon market as a whole, whereas carbon insetting projects are built by developers for individual firms after looking into their supply chain and Gas (GHG) emissions.
  • The buyer and the offset supplier are usually separate companies in carbon offsetting projects. Carbon insetting projects are a combined effort between the organization and partner suppliers. 
  • Carbon offsetting agreements mention the pricing and deliverables, emphasizing potentially reducible tonnes through the programs. Carbon insetting initiatives may use an external consultant to measure progress. 
  • Carbon insetting is aimed towards building emission control capacity— the overall sum of emission cuts may not be specific. 

Conclusion: Taking Command Over The Supply Chain Carbon Emissions

Carbon insetting projects assist in addressing some of the long-term performance issues of carbon offsetting projects. Given that carbon inset programs are directly integrated within the parameters of the contributing enterprise, they are more likely to be maintained in the long run. The concept of insetting provides several co-benefits that offsets do not. As a long-term investment, insetting can bring an organization nearer to carbon neutrality while also increasing productivity, enhancing supply chain trust and transparency, and strengthening communities. 

Insetting encourages businesses to analyze their supply chains from a broad perspective, taking into account their influence further than farmgate to how environments interface with socio-economic systems. Companies all across the world are working to cut greenhouse gas emissions. Plus, green credentials on the value chain also help companies establish a better image not just in relation to environmental leadership but as leaders of the emerging sustainable future.