Why TEM?

Management of risk in purchasing and retiring carbon offsets should drive a company’s offset procurement strategy. TEM is the largest offset provider in Australia and the team has over 60 years combined experience in global carbon markets. We expertly manage the following risks on behalf of our clients:

  • Counter party risk – We undertake extensive due diligence on the project proponent and on any third-party transactions we provide transparency to the source of the credit supply and integrity of offset purchase.

 

  • Price risk – We have the systems and processes to manage the fluctuation and volatility in offset price over the term of the offset supply contract managed, on individual projects and across portfolios.

 

  • Market risk – we have the experience and capacity to understand the supply and demand dynamics of different carbon markets to secure a predictable supply

 

  • Policy risk – we track the changes to domestic and international government policy, standards, carbon markets and certification schemes that informs future offset purchasing

 

  • Supplier risk – as a specialist buyer of carbon offsets, we have the people, systems and processes to manage client risks and we operate under an AFSL

 

A partnership with TEM delivers so much more than offsets. We thrive on nurturing a relationship that exceeds expectations by developing sophisticated, creative solutions that include bespoke marketing and communications content, strategic stakeholder engagement, consumer insights on sustainability and immersive offset project experiences.

What is a carbon offset?

One carbon offset represents one metric tonne of greenhouse gas emissions reduced or removed from the atmosphere. A carbon offset is created by either a) removing one tonne of emissions from the atmosphere by for example planting forests, or b) preventing one tonne of emissions from reaching the atmosphere by for example replacing a fossil-fuel burning power plant with a wind farm.

What is carbon offsetting?

Carbon offsetting allows individuals and businesses to invest in environmental projects around the world in order to reduce their carbon footprint. Projects are most commonly designed to reduce future emissions, such as through clean energy technology or protecting ancient forests from being cleared.

 

One carbon offset is equal to one metric tonne of carbon dioxide reductions.

 

What is carbon neutral?

An activity, product or organisation is carbon neutral when its greenhouse gas emissions are equal to zero. To become carbon neutral, companies must rigorously calculate their emissions, reduce them as much as possible, then purchase and retire carbon offsets to the equivalent of the remaining emissions.

How does carbon offsetting work for flights?

As planes fly they burn fuel that releases greenhouse gas emissions into the atmosphere. We have calculated the emissions for each flight available on Webjet, and as a passenger you can offset your share of these emissions. We then pass your offset contribution to verified carbon offset projects around the world that mitigate climate change, protect wildlife and nourish communities.

 

How do you know the offset is really happening?

TEM only supports carbon offset projects that are verified at the highest international standards. Of course, it is critical to ensure that the emission reductions generated by these projects are actually occurring. This is the work of accreditors like the VCS Program and the Gold Standard to ensure that once projects have been certified against rigorous criteria, project developers can then be issued tradable carbon offsets.

Where do your offsets come from?

We procure offsets from a diverse portfolio of international and domestic projects, including projects in every State/Territory across Australia and every continent in the world. All of our offsets are compliant under the Australian Government’s Climate Active Carbon Neutral Standard. Our projects are all accredited under a strict third-party verification standard. These standards have a rigorous set of rules and requirements to ensure each project delivers real, permanent, and additional benefits.

What does “additional” mean?

Additionality means that if the emissions reductions were not implemented by an offsetting project, then they would not have occurred anyway. This ensures that offset sales only finance projects that cause additional emissions reductions above business as usual.  Simply put, because the carbon offset project exists, there are less carbon emissions entering or floating around the atmosphere than if the project did not exist.

What does an offset project look like?

Offset projects range from those that avoid emissions with activities like funding renewable energy projects, to those that remove emissions from the atmosphere by doing things like planting trees. All of these projects sequester carbon but also offer other co-benefits to the environment, the community, and local economies.

 

Different types of projects include:

 

  • Renewable energy
  • Community projects
  • Land regeneration
  • Forest conservation and protection
  • Land management
  • Waste-to-energy

 

Each year, we take our partners on-site to an offset project to show you how they work and the real impacts they deliver to people and the planet.

 

Should I only support offset projects in my own country or countries where I do business?

Pollution and emissions do not stay within national borders. CO2 in the atmosphere spreads across the globe and is an international problem. Therefore, you can purchase offsets anywhere in the world and contribute to global emissions reduction. In many cases, carbon offset projects are located in developing countries because community and economic co-benefits from the project will have a bigger impact there. However, you may choose to purchase offsets locally due to the co-benefits that may positively impact your own supply chain or market.

 

Climate change is an international problem that cannot be solved without global support. We need individuals, organizations, and governments around the world to commit to climate action, because just one protected rainforest or carbon zero country cannot solve the problem. This is why supporting projects around the world through carbon offset funding plays a critical role in the solution to climate change.

 

What are the benefits my business will gain by offsetting?

Offsetting plays a critical role across all businesses carbon strategies. Some of the key benefits include:

  • Meeting customer, investor and staff expectations to cut carbon pollution.
  • Enhanced brand reputation and value.
  • Improved brand integrity.
  • Increased customer loyalty and sales.
  • Meeting other strategic business goals, like Reconciliation Action Plan targets and aligning with the Sustainable Development Goals.
  • Establish industry leadership.
  • Market and geographic synergies from project co-benefits.
  • Delivering co-benefits beyond carbon reductions, including biodiversity, gender equality and Indigenous employment.
  • Meet emission-reduction targets while working towards long term sustainability changes.
  • Inspire your workforce to engage in carbon reduction activities in house, in turn reducing your costs and supporting your goals.
What is the price of offsets?

The price of offsets can vary depending on the location, size, certification and type of the project. We can help tailor a portfolio of offsets that meets your budget expectations and delivers against the strategic drivers important to you and your business.

Can we purchase offsets in-line with our budget cycle or does it need to be at the end of the year?

We can retire offsets whenever fits your business cycle. We typically retire on an annual basis, but can also do it more frequently – e.g. monthly, bi-annually.

What if we end up needing more offsets than we originally thought?

We structure our agreements to lock-in a price for the portfolio of offsets. This allows your organisation to be able to purchase additional offsets at the agreed price. This is useful when you might need to ‘true-up’ additional offsets at the end of a cycle.

 

What is meant by the ‘vintage’ of a carbon offset?

Just like wine, the ‘vintage’ of an offset indicates the year the offset was created. For example, a 2016 offset from a forest conservation project denotes the tonne of carbon measured and independently verified through the additional growth of the forest in that year.

Are older vintages cheaper?

The price of an offset depends on a range of factors, including the location, size, verification standard and value of the non-carbon benefits (e.g. ecosystem health and employment). The vintage of the offset can sometimes influence the price, but is part of a much larger picture.

Isn’t buying old offsets for current carbon neutral claims disingenuous?

Carbon offset projects typically continue over multiple years and generate offsets that can remain unsold in a given year, leaving them available to buy in future years. At TEM, we work with our clients to build offsets into their climate strategy to ensure that any purchase of previous year’s offsets are done to support the forward expansion and creation of new emission reduction projects. This helps to stimulate new climate finance in this critical decade, but also recognises the value of emissions reductions (and the other benefits delivered through the project) of climate finance that has been invested in prior years. We also procure offsets from projects still in operation i.e. they are a present continuous operation so the offset finance helps the project continue to sequester or avoid emissions.

Our business won’t need offsets until all emissions reduction activities are exhausted.

Offsetting belongs as a critical part of any climate risk management strategy, not just at the tail end once all other options are exhausted. Building in offsets today has the advantage of (i) building internal capacity in carbon markets (ii) prices in the cost of carbon into doing business today (iii) helps drive further investments into much needed climate finance (iv) demonstrates sound risk management in view of new regulatory operating environments, including TCFD.