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Carbon Neutral Car Insurance
In June 2006, the UK saw the launch of ibuyeco, a service from Budget Insurance offering "100% Carbon Neutral" car insurance. The idea follows on from most conventional car insurance comparison websites, with a value added CO2 offset offered via The Carbon Neutral Company, whose clients include: Silverjet, Avis Europe, American Express, Honda, Berkley Homes, Barclays Bank, BSkyB, Royal & Sun Alliance, Volvo, and Bovis Lend Lease. Emissions are calculated by using details provided in the quotation process (ie car, CO2 emissions and annual mileage). For example a person travelling 10 000 miles annually in a small car would likely according to the quote process, emit 2.6 tonnes of CO2. This would cost approximately £20 to offset, a cheap price for a clear conscience, right?.
I have stated before I am not an advocate of carbon offsetting, however I can see the benefit of such a scheme. On the downside users would have to be prepared initially to offset their emissions to use this scheme, otherwise you could simply purchase the insurance from an alternate provider for the insurance only cost. Users are trusted to be honest, in general this is not the case with some users reducing the annual mileage as a way to reduce the insurance cost, and thus providing a proportionate reduction in offset carbon. Users may become complacent, offsetting before reducing (driving by car 0.5 mile because it offset, rather than walking).
Carbon offsets are a short term fix to reducing CO2 emissions, they do work if the projects are legitimate and projects managed correctly. But are they unsustainable in the long term? There are only so many residents of developing countries you can give energy saving bulbs to offset emissions. For example Climate Care estimate that energy saving bulbs have a net offset of 20kg of CO2 per year. The average person in the UK offsetting all their emissions would need to supply 450 bulbs through such schemes over a period of five years. Investment into renewable energy technology, has potentially a longer life and will most likely provide the realistic offsets of the future. As well as this we could see more wind farm co-operatives being developed.
Since lauching ibuyeco have, in their first three months offset over 18 000 tonnes of CO2 (0.02% of all emissions from road travel in the UK), certainly not an achievement to be scorned at.
As I have been negative about carbon offsets lately, there are positives of such projects. In the short term they provide independent financial backing for projects, which in many cases would not have been carried out otherwise, providing immediate reductions in CO2 emissions. This also is helping government meet renewable energy targets within the UK, where projects fund such developments. It would be encouraging to see more carbon offset companies using revenue to support renewable energy projects in the UK, especially large scale wind. Many companies support projects in developing countries where, it makes more sense ethically and financially to invest, and rates per tonne of CO2 are substantially lower than that in the UK, but is this at the cost of the quality of life within the United Kingdom, through increased death, hospital admissions and short term illness caused by air pollution, offset projects in the UK could potentially lead to savings of billions in taxpayer revenues.
Summarising, I think I am coming around to carbon offsets as a short term fix (within reason, like a bridging loan) but in the longer term energy efficiency and carbon offsets focused in the United Kingdom are what is needed to "fuel" a low carbon economy, providing real financial backing for renewable energy projects, and could prove to be financially beneficial to the government and its people.
Is ibuyeco good or bad? What is your opinion?
I have stated before I am not an advocate of carbon offsetting, however I can see the benefit of such a scheme. On the downside users would have to be prepared initially to offset their emissions to use this scheme, otherwise you could simply purchase the insurance from an alternate provider for the insurance only cost. Users are trusted to be honest, in general this is not the case with some users reducing the annual mileage as a way to reduce the insurance cost, and thus providing a proportionate reduction in offset carbon. Users may become complacent, offsetting before reducing (driving by car 0.5 mile because it offset, rather than walking).
Carbon offsets are a short term fix to reducing CO2 emissions, they do work if the projects are legitimate and projects managed correctly. But are they unsustainable in the long term? There are only so many residents of developing countries you can give energy saving bulbs to offset emissions. For example Climate Care estimate that energy saving bulbs have a net offset of 20kg of CO2 per year. The average person in the UK offsetting all their emissions would need to supply 450 bulbs through such schemes over a period of five years. Investment into renewable energy technology, has potentially a longer life and will most likely provide the realistic offsets of the future. As well as this we could see more wind farm co-operatives being developed.
Since lauching ibuyeco have, in their first three months offset over 18 000 tonnes of CO2 (0.02% of all emissions from road travel in the UK), certainly not an achievement to be scorned at.
As I have been negative about carbon offsets lately, there are positives of such projects. In the short term they provide independent financial backing for projects, which in many cases would not have been carried out otherwise, providing immediate reductions in CO2 emissions. This also is helping government meet renewable energy targets within the UK, where projects fund such developments. It would be encouraging to see more carbon offset companies using revenue to support renewable energy projects in the UK, especially large scale wind. Many companies support projects in developing countries where, it makes more sense ethically and financially to invest, and rates per tonne of CO2 are substantially lower than that in the UK, but is this at the cost of the quality of life within the United Kingdom, through increased death, hospital admissions and short term illness caused by air pollution, offset projects in the UK could potentially lead to savings of billions in taxpayer revenues.
Summarising, I think I am coming around to carbon offsets as a short term fix (within reason, like a bridging loan) but in the longer term energy efficiency and carbon offsets focused in the United Kingdom are what is needed to "fuel" a low carbon economy, providing real financial backing for renewable energy projects, and could prove to be financially beneficial to the government and its people.
Is ibuyeco good or bad? What is your opinion?
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