Carbon Neutral or Net Zero?

Carbon neutral or net-zero? The terms and definitions of sustainability goals can vary greatly depending on the organization’s environmental, social, and governance (ESG) initiatives. Buzzwords are commonly used interchangeably, but in reality, the definitions refer to different end goals based on the actions and results.

Carbon Neutral

The term ‘carbon neutral’ (2006 Oxford Dictionaries’ US word of the year) has risen in popularity with recent climate action initiatives. Carbon neutral projects focus on defining and removing the equal amount of carbon emitted into the atmosphere from an organization’s operations. By doing so, an organization balances the impact of its carbon dioxide emissions to zero. The most common and widely accepted solution for balancing is purchasing carbon offsets such as certified carbon credits. These credits typically fund sequestration technology, sustainable forestry, and other decarbonization projects. Carbon credits can be purchased as part of an energy supply agreement or a standalone product. Carbon credits tend to be inexpensive, commonly available, and easy to procure. For organizations just getting started in their ESG journey, this can be a simple and affordable way to demonstrate a clear commitment to sustainability.

Net-Zero

‘Net-zero’ is a science-based term that became a catchphrase of the sustainability movement, starting with the Paris Agreement in 2015. This international pact aims for net-zero global greenhouse gas emissions by 2050. It also seeks to limit the rise of global temperatures below 2° C (ideally below 1.5° C) compared to pre-industrial levels. To put this in perspective, analysts predict that global temperatures reached an estimated 1.19° C in April 2021 and will continue to rise to 1.5° C by March 2034 at current levels. A net-zero goal refers to the aggressive and robust carbon management strategies that support the Paris Agreement, analyzing and reducing every emission type. Typically, this is achieved by significantly reducing carbon and other greenhouse gas emissions across the supply chain and purchasing carbon offsets to balance the remainder.

There are as many sustainability initiatives as there are organizations supporting them. It is important to choose goals and frameworks that best align with your corporate mission and goals. The main message is clear no matter the strategy: both terms reflect a serious commitment to join the fight against climate change and become more sustainable overall.