Should we get a heat stroke or starve instead? Climate disaster or carbon neutrality?

For a quarter of a century now, Gyula I. Simonyi, president of the BOCS Civilization Planning Foundation, has been giving lectures under this title. If we use fossil energy, we will get fried, if we don’t, we will starve. What is the way out of this deadly dilemma?

According to the Hungarian Encyclopaedia of Environment (published in 1993 and 2002), the Bokor Eco-Group, the acronym behind BOCS, began to address the global crisis in 1975. Climate awareness education was added to their repertoire in the context of the 1992 World Conference on the Environment in Rio. In 1994 they were sent the 1,000-page World CO₂ Trends Report from the USA. Below is a paper by Gyula I. Simonyi.

Economic actors can do more than politics

Unfortunately, the climate catastrophe has only worsened in recent decades. This graph shows that the plethora of climate conferences and major international treaties have failed to break the frightening pace of human carbon dioxide emissions growth.

Moreover, it is not just CO₂ that is driving the Earth’s climate crazy, but a wider group of green house gases (GHGs). This includes nitrogen, fluorine and other compounds, and their impact on the atmosphere is expressed in carbon dioxide equivalents (CO₂e). But since the other main contributor to the GHG group, methane, is also a carbon compound, the term carbon neutral is more commonly used than the more accurate climate neutral.

Carbon dioxide dominates emissions in industrialised countries, so climate movements tend to point to industry as the main culprit. But if we look at the overall climate impact, non-industrialised countries also have a significant detrimental impact, e.g. through rice paddies, fertiliser, livestock, population explosion, rising consumption by the widening middle classes, etc.

Quota or credit? Pollution permit or real prevention?

The Kyoto Protocol, launched in Rio in 1992, concluded in Kyoto in 1997 and entered into force in 2005 with ratification by a sufficient number of countries, established a carbon quota and a mandatory market for the world’s major GHG emitters. In Hungary, more than one and a half hundred companies, mainly power plants, are covered. They have to measure and report their emissions and if they do not have enough allowances in a given year, they have to make a mandatory purchase.

Carbon quotas should not be confused with carbon credits. A quota is a free political atmospheric pollution (emissions) permit, of which there are fewer and fewer every year. It is traded by countries and companies on a mandatory market registered with the authorities. Hungary used to have a surplus because the Kyoto baseline date is 1990, and the country’s emissions have fallen significantly with the industrial decline since the fall of communism.

Carbon credits, on the other hand, are a verifiable form of emission avoidance, prevention, reduction and sequestration. The results of countless projects (forest conservation, non-fossil energy, family planning, energy saving, etc.) have been evaluated by independent experts. The certified avoidance, reduction, sequestration of emissions is equivalent to one credit per CO₂e tonne. These credits are held in registries, from which companies, organisations and individuals who voluntarily strive for carbon neutrality can take them to offset their emissions. The voluntary market is the subject of an annual global report, which is now available online and up-to-date.

Issuers are liable to mitigators for the damage they cause

Voluntary carbon neutralisation is in fact the most sensible way of applying the “polluter pays” principle. Money flows from the emitters to the preventers, reducers and sequestrators. This payment really compensates their emissions. It’s like when a factory replaces its lighting with LED bulbs, so they use less electricity, but anyway some emission remains. They have to offset this remainings, for example, by the retrofunding of an already evaluated project that replaced street lighting in a village with LED bulbs and thus reduced electricity use, i.e. emissions.
The word “credit” means credit because the work has already been done, the costs have been advanced. The emitters owe a debt to those who mitigate the damage of their emissions. The purchase of the credit is the post-project financing, which project owners can use to do further climate mitigation work. Another meaning of the word “credit” is trust, but here there is no need for up-front trust, as it is a proven result of work already done.

You can’t carbon neutralise at the cost of a booby prize, it’s greenwashing. One tonne of CO₂e emitted is currently estimated to cause between USD 120 and 180 in social damage. Although the market price of quotas and the carbon taxes levied in some countries do not reach this amount today, polluters must at least mitigate a significant part of the damage caused. Companies, organisations and individuals should not use cheap greenwashing to lie about carbon neutrality, but should actually pay the international market price for quality carbon credits.

Carbon offsetting can’t be done by promises (e.g. planting trees)

Planting trees to neutralise carbon is a common misconception. They estimate in advance how much carbon will be sequestered in ten to twenty years by the trees they plant. But it will only be possible to assess how much carbon the tree plantation has actually sequestered in ten to twenty years, and the credits verified as having been generated can only be used for carbon neutralisation in ten to twenty years’ time.

Of course, tree planting and, in particular, much more efficient forest conservation, has many benefits. But it is only suitable for carbon neutralisation under specific commitments and conditions. The carbon credits generated by planting and forest conservation can be destroyed later, depending on the fate of the forest. This is why it is called “endangered credit” and the revenue generated when it is used for carbon neutralisation is called “carbon mortgage”. This is because, when the credit is destroyed, this revenue (which is in fact a loan) must be used to buy a carbon credit to replace the destroyed one.

Carbon sequestered in forests and soils is threatened by a number of hazards. In addition to non-origination (in the case of tree planting) and cutting, in the event of felling, drying, forest fires, flooding, pests, rotting, damage by game, etc., the CO₂ sequestered is released back into the atmosphere. In such cases, the carbon credits used for carbon neutralisation are destroyed and the carbon neutralisation is invalidated. If, in 20 or even 50 years, the CO₂ sequestered in the forest is released back into the atmosphere, this is not climate protection.

An organisation that carbon neutralises by deforestation and tree planting must therefore assume a perpetual obligation, which is passed on to the future owners/maintainers of the forest, to replace from other sources the carbon credits already used for carbon neutralisation but which are destroyed as the forest’s CO₂ balance is reduced, i.e. to carbon neutralise the negative carbon balance and CO₂ emissions of the forest.

The five steps of carbon neutralisation

Step zero is, of course, to make the decision.

The first step is to calculate the carbon footprint of the company, organisation, person or event, for example. This can be done by anyone, for example by using the calculator on the BOCS website, which has forms for entering data on buildings, transport, internet use, waste, diet, lifestyle choices and even pets.

The second step is the potential reduction of emissions. Going through the items in the calculation can give you a number of ideas for streamlining your company’s operations in ways that can reduce emissions and even costs.

There is often considerable scope for reducing emissions, as shown for example by the current savings in gas consumption in Europe. The Human Development Index (HDI) is the most widely used measure of the quality of life in society. This is a number between 0 and 1, above 0.7 is considered high, above 0.8 very high. Some countries can achieve a very high HDI of 0.8 with two-thirds of the Hungarian ecological footprint. This shows that it is possible to save up to a third of consumption without compromising quality of life, through innovation and by reducing waste and carelessness.

Reducing emissions can often be said to be “money thrown in”. For example, using less energy can also reduce costs. This reflection also helps to prepare for the climate crisis and the risks from GHG emissions.

The third step is to buy carbon credits to offset the emissions we have not yet been able to reduce. We can do this bit by bit, starting with just carbon neutralising your company’s website, or your fleet of vehicles, or a key product. The latter could be because we are a supplier and our products are required to be carbon neutral, or because the customers of a particular product are particularly climate conscious.

The fourth step is to communicate our carbon neutrality to all stakeholders, both externally (customers, clients …) and internally (managers, employees, owners …). This can not only improve public perception and increase market results, but also the loyalty of employees and business partners, and the satisfaction of investors with our sustainability reporting.

The fifth step is to make carbon offsetting a part of the annual routine and to look forward with a calmer conscience to better compliance with any future government measures or tender requirements.

Last but not least, it feels good to have done something significant for the future of ourselves and our loved ones. It will be appreciated by young people, children, future generations and the whole living world.

Gyula I. Simonyi, BOCS Civilization Planning Foundation