Aid agencies plan CO2 offsets that also help poor

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London, Sep 2: From fuel-efficient stoves for displaced Congolese families to drought-resistant cashew trees in Brazil, some aid agencies offering carbon offset schemes want to marry emissions savings with help for people living with climate change.

A London-based coalition is launching a new funding scheme to address concerns about existing trade in carbon credits - primarily that this excludes the world's poorest communities, which are most at risk from the impact of global warming.

"This is very much not a minor absolution for your carbon sins, but is honestly a compensation payment for the impact you know your personal carbon emissions will have," said Andrew Simms, policy director at the New Economics Foundation (NEF), coordinating the initiative with the International Institute for Environment and Development (IIED).

The consortium says its scheme differs from conventional carbon offsetting - which has focused mostly on promoting renewable energy - because it will also help vulnerable people cope with phenomena such as more severe droughts and floods.

In the jargon, it will fuse mitigation - measures to curb carbon dioxide emissions -- with adaptation - activities enabling people to deal with climate-related problems they are already experiencing. Over the coming year, the approach will be tested in regions expected to be worst and soonest hit by climate change in Africa, Asia and Latin America.

Pilot projects will prioritise adaptation: for example teaching Indian children to swim so they can survive floods, and planting the drought-resistant cashew trees whose fruit pulp families plan to sell to schools for income.

But they will also include mitigation steps such as providing solar-powered lighting for girls in Mauritania to do their homework after dark, and solar-powered freezers to store the Brazilian cashew apple pulp which makes juice. The partners - including the UN Children's Fund (UNICEF), Greenpeace, CARE International and Trocaire -- describe the scheme as a way for charities, business and individuals to take responsibility for the damage caused by their carbon emissions in the short term.

They call people who help fund the scheme investors, rather than donors: the capital involved is human as well as financial.

"It connects me with a human being at the other end of the world who's being affected by my pollution, and I then invest in that person and relate to that person, and feel there is solidarity between us," said Saleemul Huq, head of the climate change group at IIED.

"It's not buying and selling -- it is much more investing in people."

Some existing projects backed with money from unregulated or so-called voluntary carbon emissions trading have been accused of not delivering promised environmental and social benefits. Critics also say carbon credits offer polluters a guilt-free way to carry on emitting damaging greenhouse gases. "Offsetting is something that people have little faith in because they don't know where the money goes," said Betsy Joseph of aid agency Mercy Corps, which has launched a separate initiative aimed at strengthening the relationship between carbon offsetting and poverty reduction.

Its "Cool Carbon" Web site invites individuals and businesses to calculate the cost of their carbon usage and donate that amount to carbon-neutral projects that also create jobs. In Bosnia, for example, it is partnering with a pastry manufacturer to convert used cooking oil into biodiesel that could power city buses in Tuzla.

"People can look at the progress of the projects online, and this should give them more faith that their money is going somewhere tangible, with more of a connection to those they are helping," said Joseph. The UN has called for around $86 billion in new financing by 2015 to help the world's poor cope with climate change. But so far funds from governments and a levy on UN-regulated carbon trading amount to a fraction of what aid agencies say is needed. A growing number regard the sale of voluntary carbon offsets as one way to fill the gap.