The Federal Trade Commission (“FTC”) is examining the emerging market for carbon offsets and renewable energy certificates (“RECs”) as part of an overall review of its environmental marketing guidelines (the “Green Guides”). This review comes in light of the increased marketing of environmental product and packaging features, and the use of “green” advertising claims, such as “carbon neutral,” “sustainable,” and “bio-based,” which are not currently covered by the Green Guides.

On January 8, 2008, a workshop at the FTC brought official scrutiny to advertising claims relating to carbon offsets and RECs. While no formal conclusions were reached regarding how consumers perceive carbon offset and REC advertising claims or what types of data are required to substantiate such claims, we anticipate that this workshop will be just one of several forums in which the FTC explores these complex issues.

The Advertising Law Practice Group has prepared a client advisory, which discusses these issues further.

FTC Examines Carbon Offsets and RECs