Much of what we hear on the news and from politicians today about the environment centers on carbon and related issues. Yet, many of the terms used in this discussion center on or revolve around terms unfamiliar to many of us. In fact, when BP, a major multi-national company (No. 4 on the 2009 Global Fortune 500) launches a major branding campaign that includes advertisements asking, “What on earth is a Carbon footprint?,”¹ it is clear that these key issues practically beg to be reviewed.

These terms are especially important since they directly relate to the debate over our changing climate and the economic implications of addressing these changes. In the interest of expanding and informing the debate on these critical climate and economic issues, we will review some of the key carbon terms being discussed.

Carbon: an abundant nonmetallic tetravalent element occurring in three allotropic forms: amorphous carbon and graphite and diamond; occurs in all organic compounds²

Why it is important: Carbon occurs in all organic compounds, and forms the basis for the hydrocarbons (oil, coal, natural gas) that supply 85 percent of America’s energy;³ and is in the building block for the major global warming gases — particularly carbon dioxide (CO₂) and methane (CH₄), which have been linked to our rapidly changing climate.

Carbon Dioxide (CO₂): a heavy, odorless and colorless gas formed during respiration and by the decomposition of organic substances; absorbed from the air by plants in photosynthesis

Why it is important: Carbon dioxide (CO₂) is also the primary greenhouse gas emission responsible from man-made global warming. When carbon contained products are consumed, CO₂ is released into the atmosphere and it serves as a blanket holding in the heat the planet receives from the sun and raising the planet’s temperature.

Carbon Dioxide Equivalent (CO₂e): a measurement unit that tracks the global warming potential of different greenhouse gases by relating them to carbon dioxide⁴

Why it is important: CO₂e measurements underpin any discussion of climate change control strategies as they form the measurable and quantifiable link between the greenhouse gases and therefore provide a value to different greenhouse gas reduction projects. For example, a methane reduction project would have a tremendously larger impact of climate change than a carbon dioxide reduction project because methane has higher global warming potential – 1 ton of methane = 21 tons CO2e while 1 ton of carbon dioxide = 1 CO₂e⁵

Carbon Footprint: the total amount of greenhouse gases that result from a person’s, company’s or country’s daily activities⁶

Why is it important: Calculating carbon footprints form the starting point of any climate change management program as they are the baseline from which carbon reductions are both tracked and measured; they also allow persons, companies or countries to get a magnitude of the carbon consumption; if you want to calculate your own carbon footprint, a number of Web sites will allow you to do this, including: http://www.carbonfootprint.com/calculator.aspx.

Carbon Sink: any process or space which removes carbon dioxide emissions from the atmosphere (i.e. forests)⁷

Why is it important: Carbon sinks are key to removing the carbon dioxide released both through everyday life (i.e. humans breathing) and combustion of carbon-based fuels.

Carbon Avoidance: the act of avoiding carbon dioxide emissions through the changing or modification of behavior (i.e., energy efficiency, fuel-switching, ethanol consumption)

Carbon Removal: the act of removing carbon dioxide emission from the atmosphere (i.e. planting a carbon sink, capturing and storing carbon emissions)

Why are they important: Avoidance and removal are the only ways to reduce carbon dioxide emissions in the environment and by doing so reduce the negative impacts of climate change.

Carbon Credit: a political or financial mechanism created to represent a ton of CO₂e that has either been avoided or removed through a carbon reduction project⁸

Why it is important: Carbon credits are the political and financial mechanisms that require making any non-tax based carbon control system operate. Without some common, calculated and consistent measurement, no functioning non-tax climate change control system could be developed.

Carbon Offsetting: the process by which emissions are matched to emissions reduction somewhere else⁹

Carbon Neutrality: the goal of any person or corporate carbon management program. When a person or company is carbon neutral that means all of the carbon emissions from their activities are offset by carbon reducing programs elsewhere.¹⁰

Why they are important: Carbon offsetting and carbon neutrality are essential to making any long-term control based climate change operate. Climate neutrality provides the goal to which persons, companies and countries aspire and carbon offsetting provides the means for them to achieve the desired carbon neutrality, which in turn will stabilize and eventually reverse the changes to our climate.

Carbon Tax: an alternative form of climate change management under which emitters are charged a set tax rate for each ton of carbon they emit;¹¹

Why it is important: Carbon taxes are gaining significant momentum as practical alternative to the various cap-and-trade legislations making their way through Congress. In fact, many commentators prefer carbon taxes to cap-and-trade programs because carbon taxes “would be quicker and easier to implement, provide greater transparency and certainty of cost to businesses and be less prone to political manipulation.”¹² In fact, carbon tax legislation has been introduced in the United States House of Representatives under H.R. 2380 – the ‘Raise Wages, Cut Carbon’ Act of 2009, which can be viewed here.

With these explanations, it is our hope that you will be able to more actively participate in the climate change dialogue and further investigate the environmental and economic implications of both your own carbon footprint, and the implications of the proposed policies for your company, community and country.