Carbon Offset Integrity at a Crossroads
A storm is brewing around carbon offsets, and for good reason. Recent controversy and revoking of the “avoided deforestation” credits under the Australian Carbon Credit Units (ACCU) Scheme has exposed deep flaws in what were once considered reliable offsets by many organisations.
In Australia, an independent review of ACCUs in 2022 found that this offset method was ineffective at reducing emissions, prompting officials to ban it for future projects. Yet tellingly, these questionable credits still made up nearly one-third of all offsets used by companies under Australia’s Safeguard Mechanism last year.
In other words, even in regulated schemes, not all carbon credits are created equal. Independent research has highlighted that a large share of offsets lack integrity – up to 75% of Australian Carbon Credit Units (ACCUs) may not represent real or additional emission cuts. A particularly stark example is the avoided deforestation projects that comprised roughly 1 in 5 ACCUs; many were found to be issuing credits for protecting forests that were never actually going to be cleared. These revelations underscore a pivotal moment: businesses can no longer lean on the status quo of easy offsets and assume their climate obligations are met.
Leaders in sustainability and finance are recognising that offset credibility issues erode trust – with regulators, investors, and the public. Hence, the lesson is clear: simply buying credits to claim “neutrality” is rife with pitfalls and immense scrutiny.
The industry is at a turning point where forward-thinking companies in carbon-intensive sectors are now seeing that proactively deploying resources for reducing emissions in their own operations and supply chains isn’t just ethical, it’s becoming non-negotiable for long-term viability.
Carbon Offset Integrity at a Crossroads
A storm is brewing around carbon offsets, and for good reason. Recent controversy and revoking of the “avoided deforestation” credits under the Australian Carbon Credit Units (ACCU) Scheme has exposed deep flaws in what were once considered reliable offsets by many organisations.
In Australia, an independent review of ACCUs in 2022 found that this offset method was ineffective at reducing emissions, prompting officials to ban it for future projects. Yet tellingly, these questionable credits still made up nearly one-third of all offsets used by companies under Australia’s Safeguard Mechanism last year.
In other words, even in regulated schemes, not all carbon credits are created equal. Independent research has highlighted that a large share of offsets lack integrity – up to 75% of Australian Carbon Credit Units (ACCUs) may not represent real or additional emission cuts. A particularly stark example is the avoided deforestation projects that comprised roughly 1 in 5 ACCUs; many were found to be issuing credits for protecting forests that were never actually going to be cleared. These revelations underscore a pivotal moment: businesses can no longer lean on the status quo of easy offsets and assume their climate obligations are met.
Leaders in sustainability and finance are recognising that offset credibility issues erode trust – with regulators, investors, and the public. Hence, the lesson is clear: simply buying credits to claim “neutrality” is rife with pitfalls and immense scrutiny.
The industry is at a turning point where forward-thinking companies in carbon-intensive sectors are now seeing that proactively deploying resources for reducing emissions in their own operations and supply chains isn’t just ethical, it’s becoming non-negotiable for long-term viability.
Carbon Offset Integrity at a Crossroads
A storm is brewing around carbon offsets, and for good reason. Recent controversy and revoking of the “avoided deforestation” credits under the Australian Carbon Credit Units (ACCU) Scheme has exposed deep flaws in what were once considered reliable offsets by many organisations.
In Australia, an independent review of ACCUs in 2022 found that this offset method was ineffective at reducing emissions, prompting officials to ban it for future projects. Yet tellingly, these questionable credits still made up nearly one-third of all offsets used by companies under Australia’s Safeguard Mechanism last year.
In other words, even in regulated schemes, not all carbon credits are created equal. Independent research has highlighted that a large share of offsets lack integrity – up to 75% of Australian Carbon Credit Units (ACCUs) may not represent real or additional emission cuts. A particularly stark example is the avoided deforestation projects that comprised roughly 1 in 5 ACCUs; many were found to be issuing credits for protecting forests that were never actually going to be cleared. These revelations underscore a pivotal moment: businesses can no longer lean on the status quo of easy offsets and assume their climate obligations are met.
Leaders in sustainability and finance are recognising that offset credibility issues erode trust – with regulators, investors, and the public. Hence, the lesson is clear: simply buying credits to claim “neutrality” is rife with pitfalls and immense scrutiny.
The industry is at a turning point where forward-thinking companies in carbon-intensive sectors are now seeing that proactively deploying resources for reducing emissions in their own operations and supply chains isn’t just ethical, it’s becoming non-negotiable for long-term viability.
The Hard Truth About Scope 3 Emissions
For companies with high emissions, this pivot points straight to their biggest challenge: Scope 3 emissions, which often take the highest share of a company’s carbon footprint.
Companies know that Scope 3 is hardest to tackle, and hence, easiest to offset. However, with the current problem with the offsets outlined above, it becomes increasingly important to engage with upstream and downstream entities to work together to reduce Scope 3 emissions.
With tightening regulations and reporting standards, companies must shift their focus on full value-chain emissions. By taking on Scope 3 challenges directly, companies can demonstrate a holistic climate strategy – one that goes beyond the low-hanging fruit of operational efficiency and shows true commitment to aligning with a net-zero future.
Circular Economy Innovation
One promising path to genuine emissions reduction is through circular economy innovations – keeping materials in use and out of waste streams, thereby avoiding the emissions of producing new materials. Global Resource Recovery NT (GRR), a chemical recycling firm based out of Darwin, NT, works with major oil and gas operators to recycle key industrial chemicals (like glycol and amines) used in processes such as LNG production.
A New Benchmark: Tokenised Transparency and Trust
Our partnership with GRR showcases how circular economy innovation can combine with blockchain-based tracking and emissions accounting to deliver Scope 3 emissions reductions . By integrating NoviqTech’s Carbon Central platform, GRR tracks every litre of recycled glycol through it’s proprietary process and creates a unique digital token on a blockchain ledger, recording net emissions savings from recycling these chemicals as compared to buying virgin chemicals.
In practice, this means that GRR’s clients who purchase these recycled chemicals also get a verifiable certificate – essentially a Proof of Sustainability – showing exactly how much CO₂ was saved, hence Scope 3 emissions reductions from purchase of goods, with data tracked in real time.
Stakeholders from auditors to investors can independently verify these claims with a few clicks. This level of granularity and trust is a new benchmark for integrity and in emissions reporting. It’s no longer just about doing the right thing; it’s about proving it in a way that withstands scrutiny.
ACCUs vs. Scope 3 Emissions Reductions
The climate impact of Scope 3 emissions reductions is significant. In GRR’s case for example, studies show that producing virgin glycol can emit from 1.8 to 4.5 tonnes of CO₂e more than GRR’s recycled glycol, showing significant emissions reductions through the power of circular operations and technology.
To put this into perspective, consider ACCUs. Each unit has traded in the range of A$35–$42 per ACCU in recent months. If recycling one kilolitre of glycol avoids, say, ~3–4 tonnes of CO₂, that action is effectively worth over A$100–$150 in carbon value at today’s prices – all while directly shrinking a company’s scope 3 emissions and reinforcing circularity. Unlike purchasing offsets, these reductions show up in a company’s own Scope 3 accounts and reporting, strengthening its emissions profile.
Companies can act on these opportunities right now, without waiting on complex new technologies or policy changes. In doing so, they not only cut emissions but also build resilience against future carbon costs and bolster their ESG credibility.
The Hard Truth About Scope 3 Emissions
For companies with high emissions, this pivot points straight to their biggest challenge: Scope 3 emissions, which often take the highest share of a company’s carbon footprint.
Companies know that Scope 3 is hardest to tackle, and hence, easiest to offset. However, with the current problem with the offsets outlined above, it becomes increasingly important to engage with upstream and downstream entities to work together to reduce Scope 3 emissions.
With tightening regulations and reporting standards, companies must shift their focus on full value-chain emissions. By taking on Scope 3 challenges directly, companies can demonstrate a holistic climate strategy – one that goes beyond the low-hanging fruit of operational efficiency and shows true commitment to aligning with a net-zero future.
Circular Economy Innovation
One promising path to genuine emissions reduction is through circular economy innovations – keeping materials in use and out of waste streams, thereby avoiding the emissions of producing new materials. Global Resource Recovery NT (GRR), a chemical recycling firm based out of Darwin, NT, works with major oil and gas operators to recycle key industrial chemicals (like glycol and amines) used in processes such as LNG production.
A New Benchmark: Tokenised Transparency and Trust
Our partnership with GRR showcases how circular economy innovation can combine with blockchain-based tracking and emissions accounting to deliver Scope 3 emissions reductions . By integrating NoviqTech’s Carbon Central platform, GRR tracks every litre of recycled glycol through it’s proprietary process and creates a unique digital token on a blockchain ledger, recording net emissions savings from recycling these chemicals as compared to buying virgin chemicals.
In practice, this means that GRR’s clients who purchase these recycled chemicals also get a verifiable certificate – essentially a Proof of Sustainability – showing exactly how much CO₂ was saved, hence Scope 3 emissions reductions from purchase of goods, with data tracked in real time.
Stakeholders from auditors to investors can independently verify these claims with a few clicks. This level of granularity and trust is a new benchmark for integrity and in emissions reporting. It’s no longer just about doing the right thing; it’s about proving it in a way that withstands scrutiny.
ACCUs vs. Scope 3 Emissions Reductions
The climate impact of Scope 3 emissions reductions is significant. In GRR’s case for example, studies show that producing virgin glycol can emit from 1.8 to 4.5 tonnes of CO₂e more than GRR’s recycled glycol, showing significant emissions reductions through the power of circular operations and technology.
To put this into perspective, consider ACCUs. Each unit has traded in the range of A$35–$42 per ACCU in recent months. If recycling one kilolitre of glycol avoids, say, ~3–4 tonnes of CO₂, that action is effectively worth over A$100–$150 in carbon value at today’s prices – all while directly shrinking a company’s scope 3 emissions and reinforcing circularity. Unlike purchasing offsets, these reductions show up in a company’s own Scope 3 accounts and reporting, strengthening its emissions profile.
Companies can act on these opportunities right now, without waiting on complex new technologies or policy changes. In doing so, they not only cut emissions but also build resilience against future carbon costs and bolster their ESG credibility.
The Hard Truth About Scope 3 Emissions
For companies with high emissions, this pivot points straight to their biggest challenge: Scope 3 emissions, which often take the highest share of a company’s carbon footprint.
Companies know that Scope 3 is hardest to tackle, and hence, easiest to offset. However, with the current problem with the offsets outlined above, it becomes increasingly important to engage with upstream and downstream entities to work together to reduce Scope 3 emissions.
With tightening regulations and reporting standards, companies must shift their focus on full value-chain emissions. By taking on Scope 3 challenges directly, companies can demonstrate a holistic climate strategy – one that goes beyond the low-hanging fruit of operational efficiency and shows true commitment to aligning with a net-zero future.
Circular Economy Innovation
One promising path to genuine emissions reduction is through circular economy innovations – keeping materials in use and out of waste streams, thereby avoiding the emissions of producing new materials. Global Resource Recovery NT (GRR), a chemical recycling firm based out of Darwin, NT, works with major oil and gas operators to recycle key industrial chemicals (like glycol and amines) used in processes such as LNG production.
A New Benchmark: Tokenised Transparency and Trust
Our partnership with GRR showcases how circular economy innovation can combine with blockchain-based tracking and emissions accounting to deliver Scope 3 emissions reductions . By integrating NoviqTech’s Carbon Central platform, GRR tracks every litre of recycled glycol through it’s proprietary process and creates a unique digital token on a blockchain ledger, recording net emissions savings from recycling these chemicals as compared to buying virgin chemicals.
In practice, this means that GRR’s clients who purchase these recycled chemicals also get a verifiable certificate – essentially a Proof of Sustainability – showing exactly how much CO₂ was saved, hence Scope 3 emissions reductions from purchase of goods, with data tracked in real time.
Stakeholders from auditors to investors can independently verify these claims with a few clicks. This level of granularity and trust is a new benchmark for integrity and in emissions reporting. It’s no longer just about doing the right thing; it’s about proving it in a way that withstands scrutiny.
ACCUs vs. Scope 3 Emissions Reductions
The climate impact of Scope 3 emissions reductions is significant. In GRR’s case for example, studies show that producing virgin glycol can emit from 1.8 to 4.5 tonnes of CO₂e more than GRR’s recycled glycol, showing significant emissions reductions through the power of circular operations and technology.
To put this into perspective, consider ACCUs. Each unit has traded in the range of A$35–$42 per ACCU in recent months. If recycling one kilolitre of glycol avoids, say, ~3–4 tonnes of CO₂, that action is effectively worth over A$100–$150 in carbon value at today’s prices – all while directly shrinking a company’s scope 3 emissions and reinforcing circularity. Unlike purchasing offsets, these reductions show up in a company’s own Scope 3 accounts and reporting, strengthening its emissions profile.
Companies can act on these opportunities right now, without waiting on complex new technologies or policy changes. In doing so, they not only cut emissions but also build resilience against future carbon costs and bolster their ESG credibility.
Leading the Next Generation of Climate Action
The upshot of this turning point is a call to proactive climate leadership. Sustainability and finance leaders at oil & gas companies, mining firms, and other heavy emitters have a choice: stick to the familiar playbook of buying offsets and hoping for the best, or embrace the new paradigm of verifiable, high-impact emissions reduction.
The latter is about setting bold strategies – investing in circular resource recovery, collaborating on value-chain decarbonisation, and adopting cutting-edge tools to track progress. It’s a strategy steeped in pragmatism and credibility. Regulators are more likely to trust (and favour) companies that can demonstrate real emissions cuts backed by data. Investors, too, are increasingly adept at seeing through carbon accounting smoke and mirrors; they’re directing capital toward businesses that combine profitability with genuine decarbonisation plans.
In this new landscape, offsets aren’t disappearing, but their role is rightly diminishing to a supporting act. Traditional credits like ACCUs may still have a place, particularly for emissions that are truly infeasible to eliminate in the short term. However, the companies that thrive will be those who treat offsets as a last resort, not a first line of defence. By prioritisng actual emission reductions (especially the tough Scope 3) and transparently showcasing those achievements, businesses can rebuild trust and stay ahead of evolving compliance demands.
The example of GRR and Carbon Central is proof that high-integrity solutions are already at hand – solutions that turn sustainability from an abstract promise to real-world impact.
Leading the Next Generation of Climate Action
The upshot of this turning point is a call to proactive climate leadership. Sustainability and finance leaders at oil & gas companies, mining firms, and other heavy emitters have a choice: stick to the familiar playbook of buying offsets and hoping for the best, or embrace the new paradigm of verifiable, high-impact emissions reduction.
The latter is about setting bold strategies – investing in circular resource recovery, collaborating on value-chain decarbonisation, and adopting cutting-edge tools to track progress. It’s a strategy steeped in pragmatism and credibility. Regulators are more likely to trust (and favour) companies that can demonstrate real emissions cuts backed by data. Investors, too, are increasingly adept at seeing through carbon accounting smoke and mirrors; they’re directing capital toward businesses that combine profitability with genuine decarbonisation plans.
In this new landscape, offsets aren’t disappearing, but their role is rightly diminishing to a supporting act. Traditional credits like ACCUs may still have a place, particularly for emissions that are truly infeasible to eliminate in the short term. However, the companies that thrive will be those who treat offsets as a last resort, not a first line of defence. By prioritisng actual emission reductions (especially the tough Scope 3) and transparently showcasing those achievements, businesses can rebuild trust and stay ahead of evolving compliance demands.
The example of GRR and Carbon Central is proof that high-integrity solutions are already at hand – solutions that turn sustainability from an abstract promise to real-world impact.
Leading the Next Generation of Climate Action
The upshot of this turning point is a call to proactive climate leadership. Sustainability and finance leaders at oil & gas companies, mining firms, and other heavy emitters have a choice: stick to the familiar playbook of buying offsets and hoping for the best, or embrace the new paradigm of verifiable, high-impact emissions reduction.
The latter is about setting bold strategies – investing in circular resource recovery, collaborating on value-chain decarbonisation, and adopting cutting-edge tools to track progress. It’s a strategy steeped in pragmatism and credibility. Regulators are more likely to trust (and favour) companies that can demonstrate real emissions cuts backed by data. Investors, too, are increasingly adept at seeing through carbon accounting smoke and mirrors; they’re directing capital toward businesses that combine profitability with genuine decarbonisation plans.
In this new landscape, offsets aren’t disappearing, but their role is rightly diminishing to a supporting act. Traditional credits like ACCUs may still have a place, particularly for emissions that are truly infeasible to eliminate in the short term. However, the companies that thrive will be those who treat offsets as a last resort, not a first line of defence. By prioritisng actual emission reductions (especially the tough Scope 3) and transparently showcasing those achievements, businesses can rebuild trust and stay ahead of evolving compliance demands.
The example of GRR and Carbon Central is proof that high-integrity solutions are already at hand – solutions that turn sustainability from an abstract promise to real-world impact.
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