CARBON offsetting is widely promoted as a tool to combat climate change. In theory, it allows companies and individuals to balance their own emissions by supporting projects that reduce or remove greenhouse gases elsewhere. However, recent analysis shows that, in practice, carbon offsetting often fails to deliver on its promises.
A major review published on October 6, 2025, in Annual Reviews found that carbon offset schemes largely fall short in curbing global warming due to deep, systemic flaws.
These issues include over-crediting, a lack of real additional benefit, impermanent results, leakage (where saving emissions in one location causes more emissions elsewhere) and double counting of benefits.
These problems are not isolated; rather, they reflect fundamental weaknesses in the voluntary carbon market. The review concluded that only about 16 per cent of offset credits lead to genuine emissions reductions.
This finding is consistent with earlier research. A meta-analysis in Nature Communications reported the same 16% success rate for carbon credits, raising serious concerns about relying on offsetting as a comprehensive climate solution.
One of the most popular types of offsets clean cookstove project has also been criticized. A study reported by The Guardian in January 2024 found that the climate benefits of these projects were overstated by an average of 1,000 per cent, meaning their true impact is just one-tenth of what is claimed. The researchers argue that current rules allow for overestimation of both stove usage and environmental benefits, which inflates the value of these credits.
Rainforest protection projects have proven equally problematic. An investigation in January 2023 revealed that over 90% of rainforest carbon credits certified by Verra the largest offset certifier are likely “phantom credits” that do not deliver real carbon reductions. These credits often rely on exaggerated assumptions about deforestation threats and fail to achieve meaningful impact.
Similarly, a September 2023 report found that rainforest schemes frequently fail on key quality measures, such as baseline accuracy, leakage, durability, and community safeguards. Many projects overstate their effectiveness and sometimes even harm vulnerable forest communities.
The negative findings have had real market consequences. Between 2022 and 2023, the value of rainforest offsets dropped by 62%, and the overall voluntary carbon market shrank by 61%—from $1.9 billion to $723 million. This collapse was driven, in part, by scientific and media scrutiny revealing the ineffectiveness of many offset schemes.
More than 60 climate scientists have warned that using ineffective offsets may actually delay the transition to true emissions reductions. They argue that offsetting can prolong high-carbon activities and distract from the urgent need to cut emissions directly. The scientists stress that “real zero” achieved through direct emission cuts is the only way to prevent worsening climate impacts.
In Australia, a study of the “human-induced regeneration” method designed to regrow forests in arid areas found that nearly 80% of projects failed to increase tree cover between 2015 and 2022. As a result, most offsets issued under this program did not reduce emissions as promised. These critical findings have led to calls for reform. The Climate Crisis Advisory Group, led by former UK chief scientific adviser Sir David King, has warned that the voluntary carbon market must either reform or “go out of business.” The group recommends rigorous scientific standards, guaranteed benefits for local communities, and a focus on projects that actually remove CO₂ from the atmosphere.
Prof. Azlizam Bin Aziz, Dean of the Faculty of Forestry and Environment, Universiti Putra Malaysia, stated regarding offsetting projects: “Effective carbon offset programs necessitate collaboration among scientists, local communities and policymakers to guarantee outcomes that are both environmentally and socially responsible.”
Prof. Azlizam Bin Aziz, Dean, Faculty of Forestry and Environment, UPM
The Science Based Targets initiative (SBTi), which guides corporate climate goals, has also limited its support for offsets. In mid-2024, SBTi released research showing that only 12–33% of carbon credits deliver the expected benefits. The organization now advises that offsets should account for no more than 10% of a company’s emissions, with real reductions required for the remainder. New standards are expected by late 2025.
Despite these challenges, some offset projects still show promise. For example, the Annual Reviews study noted that clean cookstove and landfill gas capture projects may hold potential, even if they currently fall short.
“For forest carbon offsets to have a significant impact, they need to show quantifiable outcomes on the ground and go beyond paperwork,” said Associate Professor Dr. Nazre Bin Saleh of the Faculty of Forestry and Environment, UPM.
In London, some councils have used offset funds to support genuinely innovative local climate projects. For instance, the Bunhill heat and power network in Islington captures warm air from underground train tunnels to provide affordable, low-carbon heating to homes and public buildings. Other councils have used offset revenue to retrofit schools and community buildings with efficient heat pumps and insulation.
In summary, while many carbon offsetting projects are flawed and fail to deliver real climate benefits, some targeted efforts especially those that reduce emissions or remove carbon at the local level can still make a positive contribution. The key is to approach offsetting with skepticism, demand transparency and scientific rigor, and prioritize direct emission reductions alongside high-quality removal projects.
The views expressed here are those of the writer and do not necessarily represent the views of Sarawak Tribune. The writer can be reached at khanwaseem@upm.edu.my.
