California Attorney General Opinion 24-201

BACKGROUND

As awareness of climate change continues to grow, individuals and businesses are increasingly interested in reducing the greenhouse gas emissions associated with their activities. 1 One instrument used to achieve that goal is a “carbon offset.” A “carbon

1 See, e.g., Assemblymember Jesse Gabriel, Fact Sheet, AB 1305—Voluntary Carbon Offset Transparency (Feb. 27, 2023) (Bill Author Fact Sheet).

1 24-201 offset is when one entity” who wishes to reduce its emissions footprint without altering its activities “pays another entity” to implement emissions reductions. 2 An offset seller might promise to remove existing greenhouse gases from the atmosphere—for example, by growing a forest or installing machines that remove carbon dioxide from the air. 3 Or a seller might promise to prevent future emissions that would otherwise have occurred— for example, by protecting a forest that would otherwise be destroyed.

In California, carbon offsets can be used to satisfy certain state regulatory requirements. Polluters subject to emissions limits under the State’s Cap-and-Trade program, for instance, can comply with a small portion of their legal obligations by purchasing…