Joel Makower has a must-read post on the intricacies of so-called climate neutrality.
Say Company X manufactures a material; one day, it figures out how to manufacture the material more efficiently, or make it lighter, or some such.
The material is used by Company Y to make a product. With X’s more-efficient, lighter material, Y is able to make its product lighter and more efficient, and thus reduce the product’s CO2 emissions.
Who gets credit for the carbon reduction? A or B?
Now that CO2 emissions credits are a tradable commodity — that is, worth money — this is not an academic question. Figuring out just how credits are allocated is going to become a more and more pressing matter in coming years.
And, as Joel’s post illustrates, it’s going to be anything but a simple undertaking.