b'BACK TO NAVIGATIONGeographic concentrationLowest cost offset (natural carbon solutions) potential is limited to relatively few countries. The volume of supply in these countries is subject to uncertain political commitments and the practicality of operation in these countries.Project risksOffsets projects have accreditation risk and equity risks that impact their feasibility delivery.Available financeThe long timelines and unknown risks are less attractive to finance, and the levels of government financial support are unknown.CHOOSE A GOOD CARBON OFFSETThere are four key ideas and principles to consider that make a reliable carbon offset:AdditionalityEnsure that the project or outcome wouldnt have happened anyway. For example, renewable energy projects often have sound business cases without offset income.Permanencegreenhouse gas emissions need to be removed from the atmosphere in the long term, which may mean new forests requiring ongoing management and protection may be risky permanent carbon sinks.Double-countingYou have to make sure you have an exclusive claim to your emission reductions. If someone purchases an offset, the underlying emissions reduction shouldnt be sold again or left on someone elses balance sheet.LeakageThe collateral issues caused by offsets programs can provide perverse outcomes. For example, suppose a forest is protected to create offsets in one area. In that case, it may create greater pressure on forests that arent subject to protection or may create other environmental and social.Carbon offsets, combined with renewable energy, are critical tools of an organisations carbon-neutral strategy and part of a journey toward Net Zero. We are witnessing a rapid increase in climate targets and Net Zero commitments from countries and companies, which is expected to continue beyond COP26. Demand for carbon credits has doubled over the past three to four years and is forecast to increase by a factor ranging from 20x to 100x by 2050. This has inevitable consequences for the availability, quality and price of carbon offsets. However, there are significant challenges regarding standards for offsets and their quality and certainty of supply. 2022 AusLSA Member PerformanceFollowing the trend from last year, almost one-quarter of AusLSA member firms reduced their net carbon emissions levels through the purchase of renewable electricity and or carbon offsets.The below graph shows that 87 per cent of the reductions from the member firms greenhouse gas nettable reductions were from the purchase of voluntary carbon offsets with 13 per cent from the purchase of renewable energy. This preference for offsets is most likely because the costs of offsets are significantly lower however these comparative costs are likely to narrow significantly over the next 10 years. Offsets can also provide an additional social and environmental value realised from their production which aligns with firms other priorities.After a reduction in the purchase of voluntary offsets in 2021, which was due to low gross greenhouse gas emissions, voluntary offsets grew by 42 per cent this year. The amount of renewable electricity purchased doubled this year growing to a 31 per cent share of total electricity use.71'