Insetting versus Offsetting

What is Insetting?

Carbon insetting is a carbon project that occurs within a company’s value chain or in local communities where their supplier operates.

An example would be the use of biofuels to reduce emissions. Biofuel produces lesser emissions than standard low sulfur fuel oil used onboard vessels. Emissions saved are later sold to customers indicating a direct emission reduction.

What is Offsetting?

Carbon offsetting refers to a reduction in GHG emissions by investing in projects outside of the company's value chain, and is in turn used to compensate for emissions that occur within the company's value chain.

Examples may include blue carbon projects, afforestation projects and renewable energy projects.

Difference between insetting and offsetting