Apparently one of the reasons all those stars at the Oscars were so pleased with themselves is that they all got a smugness coupon in their gift bags (emphasis added):
Hollywood's wealthy liberals can now avoid any guilt they might feel
for consuming so much non-renewable fossil fuel in their private jets,
their SUVs, and their multiple air-conditioned mansions. This year's
Oscar goodie bag contained gift certificates representing 100,000
pounds of greenhouse gas reductions from TerraPass, which describes
itself as a "carbon offset retailer." The 100,000 pounds "are enough to
balance out an average year in the life of an Academy Award presenter,"
a press release from TerraPass asserts. "For example, 100,000 pounds is
the total amount of carbon dioxide created by 20,000 miles of driving,
40,000 miles on commercial airlines, 20 hours in a private jet and a
large house in Los Angeles. The greenhouse gas reductions will be
accomplished through TerraPass' [program] of verified wind energy, cow
power [collecting methane from manure] and efficiency projects." Voila,
guilt-free consumption! It reminds us of the era when rich Catholics
paid the church for "dispensations" that would shorten their terms in
Purgatory.
Something smells here, and it is not the cow-poop methane. This 100,000 pound coupon retails for $399.75 (5x79.95) on the TerraPass web site. First, this rate implies that all 300 million Americans could offset their CO2 emissions for about $100 billion a year, a ridiculously low figure that would be great news if true.
Lets look at solar, something I know because I live in Arizona and have looked at it a few times. Here is the smallest, cheapest installation I can find. It produces 295 CO2-free Kw-hours in a month if you live in Phoenix, less everywhere else. That is enough to run one PC 24 hours a day -- and nothing else. Or, it is enough to run about 10 75-watt light bulbs 12 hours a day -- and nothing else. In other words, it is way, way, way short of powering up a star's Beverly Hills mansion, not to mention their car and private jet. It would not run one of the air conditioning units on my house. And it costs $12,000! Even with a 20 year life and a 0% discount rate, that still is more than $399.75 a year. For TerraPass's offset claim to be correct, they have to have a technology that is one and probably two orders of magnitude more efficient than solar in Arizona.
[update: Al Gore's house 221,000 kwH last year. Call it 18,400KwH per month, that would require about 62 of these solar installations for $744,000. I don't think $399.75 is really offsetting it]
So if Al Gore and the Hollywood-ites start whipping out these coupons and claiming to be green, be very, very skeptical. My guess is that TerraPass is less like a real carbon offset and more like, say, the International Star Registry, where you get a nice certificate for the wall and the internal glow of having a star named after you (which, officially, it really is not). Both the star registry and TerraPass are selling the exact same thing -- fluff. Actually, TerraPass's certificate is a bit cheaper than the star registry. Smugness on sale! Think of it as the "International Earth Good-Guy Registry."
Update: This type of thing is incredibly amenable to fraud. If you sell more than 100% of an investment, eventually the day of reckoning will come when you can't pay everyone their shares (a la the Producers). But if people are investing in CO2 abatement -- you can sell the same ton over and over and no one will ever know.
Also, this is a brilliant way to finance a power station. Say you want to build a wind power station. Actual regular investors will, you know, want a return paid to them on their investment. But TerraPass has apparently found a way to get capital from people without paying any return. They just give these people a feel-good share of the lack of CO2 emissions and a little certificate for the wall, and TerraPass gets capital they never have to repay to build a power station they likely would have built anyway that they can then in turn sell the power from and not have to give any of the revenues to investors. Smart.
More thoughts: My guess is that TerraPass, when it sells the electricity from these projects to customers, is selling it on the basis that it is earth-friendly and causes no CO2 emissions. This lack of emissions is likely part of the "bundle" sold to electricity customers. But note that this would be selling the same lack of emissions twice -- once to TerraPass certificate holders, and once to the electricity customers. I am sure they are both told they are avoiding X tons of emissions, but it is the same X tons, sold twice (at least). Even Enron didn't try this.
I really wish I had fewer scruples, because this would be a fabulous business model -- free capital, the ability to sell the same goods multiple times to different people, all the while getting lauded for saving the world in the press and getting invited to the Academy Awards.
Update #2: LOL. IowaHawk is offering the same thing, but for the discounted rate of $9.95! And with much better bumper stickers. He also suggests a multi-level marketing approach. Here are just two of many choices: