Junk carbon offset scheme too good to be true for EV and solar owners

Climate Integrity analysis has revealed that a new carbon credit platform, Aetium, appears to be misleading consumers about the environmental benefits of its carbon credit scheme.

Aetium uses an online platform to issue carbon credits to consumers for using solar panels and electric vehicles they already own, with the prospect of payment. The platform offers carbon credits to buyers, such as individuals and businesses who want to ‘offset’ their emissions. 

The company claims that buyers of the carbon credits listed on its “Exchange” are “supporting a project that actively avoids or removes CO2”, “supporting CO2 reductions that cancel out your CO2 footprint” and that the credits “accurately represent genuine CO2 reductions”.

The carbon credits issued by Aetium are not validated by any third-party certifier of voluntary carbon offsets or independent standards regime, nor are they certified by any government-operated crediting scheme.

Climate Integrity analysis of Aetium’s business has raised serious concerns about these claims, particularly that the platform claims its credits represent genuine C02 reductions when they do not meet the standard for additionality. (Additionality explained in next section)

“An additionality test is a critical integrity safeguard in all major carbon credit standards, it assesses whether a project genuinely creates ‘additional’ emissions reductions, beyond ‘business as usual’ and which would not have occurred in the absence of the incentive,” Claire Snyder, Executive Director of Climate Integrity, said. 

“Aetium’s credits fail to meet an additionality test because consumers signing up to the scheme would have bought and used their EVs or solar panels whether Aetium existed or not.”

To protect consumers from the scheme, Climate Integrity has filed a complaint to the Australian Competition and Consumer Commission outlining how the company may have breached Australian Consumer Law by engaging in misleading and deceptive conduct.

Climate Integrity has also filed a complaint to Ad Standards, stating that Aetium’s claims may be in breach of the Environmental Claims Code administered by the Australian Association of National Advertisers.

“Aetium’s claim that it aligns with the industry code of practice is another example of the integrity crisis in Australia’s carbon market. ” said Ms Snyder.

What is additionality and why does it matter?

Additionality

A key criteria for the creation of carbon credits is the concept of ‘additionality’. 

A project, and the carbon credits it generates, can only be classified as ‘additional’ if the removal of carbon dioxide would not have occurred in the absence of the incentive. A requirement to achieve ‘additionality’ has been adopted by virtually all carbon crediting regimes and by climate scientists and refers to the removal of carbon dioxide from the atmosphere beyond ‘business as usual’ practices.

As Aetium is issuing carbon credits to consumers for their existing solar panels, electric vehicles and for existing forests - the credits issued don’t satisfy the principle of ‘additionality’ and do not represent genuine reductions in carbon emissions. 

Avoided Emissions

Further, the methodologies adopted by Aetium are based on the contentious concept of ‘avoided emissions’. This concept uses a flawed approach of calculating emissions reductions of activities when compared against hypothetical emissions intensive alternatives. ‘Avoided Emissions’ offsets cannot cancel out emissions, and claims of their environmental benefits are likely to mislead consumers.

What happens next?

Climate Integrity engaged lawyers at the Environmental Defenders Office to make the complaints to the ACCC and Ad Standards and looks forward to any response from those two regulatory bodies. 

Climate Integrity also met with Aetium to raise its concerns. Aetium’s response disputed the definition of additionality that exists in the scientific literature and in carbon credit standards such as Verra, IVCM, the Climate Change Authority, characterising the meaning of ‘additionality’ as ‘grey’. Aetium is yet to sell carbon credits to the market. 

Aetium is a signatory of the Carbon Market Institute’s (CMI) industry code of conduct, which states that its mission is; “To enhance the integrity, transparency and accountability of Australia’s carbon industry,...”, Climate Integrity has written to CMI to raise its concerns.

A response from the administrator of the Code of Conduct said that it does not regulate or assess the technical quality of carbon credits and that Climate Integrity’s concerns are outside of the scope of the code and would be more appropriately dealt with by a relevant regulator.