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Carbon offsetting and certificates. How do they work?

by Powershop on

Carbon offsetting and certificates. How do they work?
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We get asked a lot of questions about carbon offsetting, what we support and how we go about this process. You asked, so let’s get stuck in!

Powershop has been offsetting 100% of the carbon associated with our customers’ energy usage for 5 years. And we’ve been accredited under the government’s Climate Active Carbon Neutral Standard as a carbon neutral business since 2014. Let us step you through why we choose to offset, and the process around it.

Renewable energy and your home

No matter where you buy your electricity from, it all comes from the same central pool called the National Electricity Market (NEM). The energy grid is made up of energy from a variety of sources, including renewable generation (solar, wind, hydro) and coal-fired power.

Image explaining Powershop's carbon offset process
*We commit to using Certified Emission Reduction certificates. These certify that emissions have been reduced by a Clean Development Mechanism project project verified under the Kyoto Protocol.
Why carbon offset?

No matter which energy retailer you buy your electricity from, it all comes from the National Electricity Market (NEM). The energy in the NEM is from a mixure of energy generation types, including fossil fuel power plants (coal, gas, oil) and renewable generators (wind, water, sun).

Because we can’t control which electrons are actually delivered to your home or business, we currently offset 100% of the carbon emissions associated with our customer’s electricity usage (at no additional fee to you).

So what is carbon offsetting?

Carbon offsetting is a process that involves a reduction in emissions of carbon dioxide (or other greenhouse gases) in order to compensate for, or to offset, an emission already made elsewhere. Essentially, we purchase ‘carbon credits’ to offset or counteract the carbon created by your energy usage.

About carbon certificates

At Powershop, our carbon offsetting process involves the purchase of Australian Carbon Credit Units (ACCU) and Certified Emission Reduction (CER) certificates. These are not physical certificates, but are a digital currency traded on the market – much like money.

According to the Clean Energy Regulator website:
“a CER is a tradable unit representing one tonne of carbon dioxide-equivalent (tCO2-e) of emissions abatement or sequestration”. An “ACCU issued represents one tonne of carbon dioxide equivalent (tCO2-e) stored or avoided.”


Our Carbon Certificates

We employ a rigorous selection process when it comes to purchasing our certificates to ensure that they are accredited under the United Nations Framework Convention on Climate Change (UNFCCC) Clean Development Mechanism project verified under the Kyoto Protocol. That’s a mouthful!

Basically, it means we care about what projects we buy certificates from to ensure that they are verified programs which contribute to lowering carbon emissions around the world. We’re not just buying any certificate – it has to meet accredited guidelines.

We select a mixture of both local, national and international projects, including Forests Alive’s Verified Emission Reduction Credits (an Australian based forestry project).

photo of forest

photo of a native forest
Forests Alive Butlers Gorge. Source: Forests Alive website

We do not purchase any certificates from projects which support palm oil, and incorporate other parameters around environmental protection which guide the certificates we purchase.

How can I learn more?

Transparency is incredibly important to us at Powershop, and further information on our certificates can be found on our Carbon Neutral PDS page.

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5 comments on "Carbon offsetting and certificates. How do they work?"
  1. Karen McVean, January 28, 2020:

    Dear Powershop

    Please review your link to Forests Alive.

    Kind regards


    • Powershop, February 5, 2020:

      Hi Karen, thanks so much for bringing this to our attention. We have updated that link. Cheers, Rosie.

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  3. Damon Moloney, April 12, 2022:

    What is the difference between Powershop’s “free” carbon offsetting and an accredited greenpower product? Powershop also offers Greenpower.

    • Powershop, April 12, 2022:

      Hi Damon, great question.

      Carbon offsetting is done through the purchasing of Certified Emission Reduction (CER) certificates. Projects that reduce or remove carbon emissions from the atmosphere receive carbon credits equal to the emissions reduced. These carbon credits can then be bought by organisations or individuals looking to offset their carbon emissions.

      GreenPower is a government accredited program that allows Australians to displace their electricity usage with certified renewable energy done in the form of Renewable Energy Certificates (RECs). The great thing about purchasing GreenPower is you’re assisting GreenPower accredited generators to compete with fossil fuel generators, as the bulk of the premium you pay for GreenPower goes directly back to the GreenPower accredited generators through the REC process.

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