Jan 10 2008
Talking about Carbon Offsets with Terrapass
KJ and I recently had the opportunity to chat with Erik Blachford, the CEO of Terrapass. I think Terrapass is a fascinating business, in part, because it’s a for-profit enterprise, with a goal of being self-sustaining, rather than relying on donations. It’s a carbon-offset company, whose core value is helping people who want to take responsibility for their contribution to global warming by allowing them to invest in an alternative energy project by purchasing a carbon-mitigating “pass”.
The strategy that Blachford articulated is consumer focused. The philosophy is that using carbon offsets is a personal choice that will have a natural uptake as more and more people use them to offset environmentally unfriendly activities such as car usage and air travel. Presumably, businesses will be impacted by a groundswell of employees and customers who: 1) are concerned with climate change, 2) are taking action to mitigate it, 3) want their employers and vendors to participate.
Terrapass has a new program called “Carbon Balanced Business”. Targeted towards businesses, it is marketed as a way for businesses to keep employees happy. However, most of Terrapass’s current business focus seems to be selling partnersips. Companies like Expedia, car rental companies, retailers, and notably, the Ford Motor Company re-sell the Terrapass carbon offsets as an add-on to their products. Erik indicated that Terrapass will invest in additional salespeople who can build business relationships. I think this is a great idea, because the potential for Terrapass to create one-to-many relationships seems too good to pass up.
But I wonder if Terrapass is missing an opportunity to sell its product directly to businesses for their own use. I’d like to see Terrapass put together some corporate-targeted programs with large companies. Most large companies have sustainability programs or are thinking about them. For companies who know they need to do something, and are not sure where to start, it’s a no-brainer– what could be easier than buying carbon credits? Corporate clients could provide scale and a financial foothold for a fledgling company. Terrapass is an easy way for a company to get started down the path with a relatively small investment and no process change (this, of course, presents its own problems, but that’s another day’s blog).