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EGYPT 2022


Net Zero vs. Carbon Neutral

November 15th, 2022
net zero

Net Zero vs. Carbon Neutral  

The terms net zero and carbon neutral have gained traction since the 21st United Nations Climate Conference of the Parties, commonly referred to as COP21. This 2015 conference resulted in the Paris Agreement, an international treaty that recognizes climate change issues and provides a framework to start combating them. The main goal outlined in this agreement is to keep the total global temperature warming within 1.5 degrees Celsius compared to pre-industrial levels. 194 parties have signed the agreement since its inception. However, this number is made up of mostly governmental organizations or countries, and it doesn’t recognize the vast number of companies making climate commitments, many through carbon-neutral or net-zero pledges.  

Carbon neutral refers to an entity that reabsorbs the same quantity of carbon back into the atmosphere as it produces. Net-zero emissions follow a similar idea but encompass all greenhouse gases. Since the Paris Agreement, many companies have begun setting their own environmental, social, and governance (ESG) goals relating to carbon neutrality and net-zero emissions to help ensure a more sustainable future for themselves and for the planet.

What is Carbon Neutral? 

Carbon neutral means that the amount of carbon emissions produced is equivalent to the amount of emissions absorbed or “sunk” back into the atmosphere. Carbon sinks are entities that absorb more carbon dioxide than they produce. Earth’s largest natural carbon sinks are oceans, forests, soils, and wetlands. Carbon neutrality is an important landmark on the path to net zero because carbon dioxide is the most ubiquitous greenhouse gas (GHG) and accounts for approximately 80% of all GHG emissions produced from human activities in the U.S.  


The most common way businesses become carbon neutral is through purchasing carbon offsets. These carbon offsets are typically carbon sinks and can be achieved by planting trees or restoring land. Although offsetting emissions can be controversial as it can be used as a way for companies to “buy” neutrality, it is still an important part of the solution as an investment in the fight against climate change. 

What is Net Zero? 

Net zero relates to all GHG emissions. This includes ozone (O3), methane (CH4), water vapor (H2O), chlorofluorocarbons (CFCs), and carbon dioxide (CO2). Net zero can seem intimidating when looking at the large goal of producing zero emissions. Absolute zero is a term reserved for the rare and impressive occasion that a company is able to omit all GHG emissions. However, net-zero emissions means reducing all GHG emissions down as close to zero as possible and offsetting. The first step on the path to net zero is finding where unnecessary emissions are being produced and eliminating them as soon as possible. Emission calculators can be helpful when trying to figure out where and how to start the journey to net zero. And for businesses looking to accomplish net-zero emissions, becoming carbon neutral is a big step in the right direction. 

Becoming Net Zero or Carbon Neutral in Business 

In order to achieve a global temperature increase of less than 1.5 degrees Celsius, all greenhouse gas emissions would need to decrease by 45% by 2030, and we would need to reach net zero by 2050. A comprehensive study of net-zero goals for all nations, all large cities (with populations over 500,000), and all companies in the Forbes Global 2000 list found that almost 20% of these entities have net-zero goals in place. While 20% may not seem like much, many of these goals cover scope 2 emissions (emissions from purchased electricity, steam, or heat) and scope 3 emissions (such as supply chain emissions). Taking these measurements into account, this 20% covers over 60% of global GHG emissions and over half of the world’s population. 

The private sector is uniquely positioned to make a positive global change. Many businesses have pledged to become carbon neutral or achieve net-zero emissions within the decade, setting goals sooner than their public counterparts. These goals can do more than just help the planet. They can help businesses become more energy independent, appeal to conscious customers, and appeal to investors who are considering ESG initiatives and rankings more and more every year. 


Carbon neutrality and net zero are both aspirational climate goals. Reaching net zero does not mean every ton of GHG emissions is cut; it just means getting as close to that as possible and responsibly offsetting the rest. Carbon offsets or carbon credits are necessary for the majority of businesses aspiring to become carbon neutral. The Paris Agreement popularized the goal of net zero and helped provide a framework and direction for governments, countries, and other similar entities wanting to make a difference. The private sector has also used this framework and direction. Over 21% of the Forbes Global 2000 list has net-zero goals, representing sales of nearly $14 trillion.  

It may not always be clear what path to take toward achieving these goals, so getting expert assistance is key. That’s where World Kinect comes in. From comprehensive energy audits and sourcing renewable energy and fuel options to helping you decide which carbon offsets are the most impactful and reputable for your business, count on us to help. Wherever you are on your Sustainability Journey, connect with our World Kinect energy experts today