Carbon-compensation involves a company purchasing and retiring a volume of voluntary carbon credits to compensate for (or offset) greenhouse gas (GHG) emissions. This can be applied to the energy products that oil and gas companies sell to their customers such as those used in fuels for transportation and heating. Products, whereby part of their life cycle GHG emissions have been compensated for, provide an effective transitional solution while lower emission technology and energy sources scale up.
- Ipieca members support the use of carbon-compensated products that align with the GHG emissions mitigation hierarchy. Priority is given to avoiding and reducing emissions within the product value chain.
- Carbon-compensated products can enable businesses to extend mitigation action beyond their value chains.
- Over time, offsetting should be shifted towards carbon removal and permanent storage.
- Offsets should be verified by well-recognized, independent international or national carbon standards and transparently accounted for.
- For carbon offsets and carbon-compensated products to be most effective, all stakeholders should collaborate.