06 Oct 2022

Going net zero now and the problem with the mitigation hierarchy

Net Zero Hierarchy

It could be time to completely flatten the concept of the carbon ‘mitigation hierarchy’ if we are to move towards what’s truly needed: net-zero now. By seeing emissions avoidance, reductions and offsets as activities that need to be invested in simultaneously rather than in a ‘one before the other’ approach, business will do well in creating a new leadership platform of net-zero while better managing price, technology and physical climate risk going forward.

Mitigation hierarchies have been defined for over a century in the field of natural resource management. More recently in the last few decades, the concept has been applied in the global shift behind cutting carbon emissions.

Put simply, it suggests that an organisation work through a process of prioritising efforts that avoid carbon emissions, and progressing through stages of minimising emissions before balancing out residual emissions through carbon offsetting as a last resort. The underlying intention is for emission reductions to be made at the source, and to ensure that carbon offsets do not lead to delaying the global decarbonisation effort.

While the concept provides a simple and logical pathway to follow, the resulting rhetoric is one that diminishes the necessary role of carbon crediting projects as one string in the bow needed to combat runaway climate change. The interpretation of the mitigation hierarchy in corporate climate change agendas has recently served to create a false sense that we have time to stage these approaches to meet the ultimate goal of net zero emissions as soon as possible.

The latest IPCC Report reminds us that we need to urgently peak global emissions, which requires “rapid and deep and in most cases immediate GHG emission reductions in all sectors”. The IPCC finds that achieving net zero emissions in the energy sector for example, which represents 34% of net anthropogenic GHG emissions, requires significant structural and technological changes, and that carbon dioxide removals “will be needed to counterbalance residual emissions.” Similarly, “negative emissions are likely needed” to counteract emissions from the transport sector (representing 15% of global emissions)[1].

The corporate leadership the world needs involves a mature and holistic understanding of this multifaceted challenge. A new frame of leadership would see a compression of the mitigation hierarchy from the traditional pyramid of priority actions over time, to a ‘foot to the floor’ straight line of simultaneous climate action. To achieve this, corporates need to work together with concerted urgency.

Some of the best corporate climate strategies have already started to do this. Australia is peppered with examples of organisations who are making strategic investments into fuel changes, technology shifts and efficiency gains side-by-side with offsetting the emissions they are responsible for today.

The carbon offsetting component of these strategies achieves a number of things:

  1. they offset the emissions associated with doing business today
  2. they are building in a real carbon price into the way they do business, regardless of Government policy
  3. they are making investments into ways to cut their emissions today, while investing in longer-term carbon mitigation options that reduce the reliance on offsets in future
  4. they manage forward policy, price and physical climate risk better than if they were to rely on one of the elements of the mitigation hierarchy on its own.

An example of how finding the balance between options under the mitigation hierarchy can be challenging is illustrated through a British airline which has recently moved from a position of 100% customer emissions offsetting since 2019, to stopping automatic purchases of offsets for the airline from 2023. This jump from one end of the hierarchy to another has not only been a public credibility challenge for the airline, but illustrates the risks associated with a binary view of ‘no offsets’ versus ‘only offsets’.

Aviation is one example of a sector that requires emissions removals and offsets in order to reach net zero. The IPCC’s consensus is that for such sectors, removals are “unavoidable”. Actions like this also perpetuate a public misconception that channelling finance into carbon projects is somehow at odds with the goals of the Paris Agreement.

A balanced approach would be to see the organisation adopt an ‘all of the above’ approach to its targets. This would recognise the continued barriers to financing decarbonisation in developing countries – ranging from in community and domestic settings (e.g., shifting away from toxic cooking methods) to national-scale electricity grid decarbonisation (e.g., channelling finance into deployment of renewables). This is not only needed to avoid future publicity and financial risks associated with their targets, but it’s what is necessary for the planet to avoid heating beyond 1.5 degrees.

So, let’s stop pushing our targets up a steep hierarchy-hill and instead put the foot down on climate action by seeing emissions avoidance, reduction and compensation as complementary actions that need rapid, deep and immediate action today.


Adrian Enright is General Manager Corporate; passionate about surfing, family and the unrelenting quest for a healthier future planet.
Georgia Cox is TEM’s Policy and Regulatory Manager. She loves getting active in nature, and exploring new cultures and languages.