Carbon offsetting, along with emerging carbon capture and storage technologies, are being widely relied on to meet net-zero CO2 targets.
Although many businesses have made some commitment to reaching net-zero by 2050, many are relying on carbon offsetting rather than directly reducing their own emissions.
The PwC report estimates that in 2022, FTSE 350 companies publicly reported purchases of voluntary carbon offsets totalling £38m. Based on current pricing models, PwC has calculated that by 2030, this same volume of offsets would cost companies more than £135m. This is then expected to continue to rise until 2050, when the cost of the same volume of offsets may peak at £365m.
The report also identifies that 80 per cent of the volume of offsets reported to have been purchased in 2022 were classed as avoidance offsets, derived from projects such as avoided deforestation. There is growing momentum that only removal offsets (those generated from projects...