As a tangible response to climate change, stringent policies are required to control greenhouse gas emissions.
Net-zero emissions targets often pose significant challenges, making them difficult to achieve in the short term.
In this context, a carbon-neutral approach is frequently viewed as a more realistic transitional pathway, particularly when integrated with energy sources that have relatively lower emissions, such as Liquefied Natural Gas (LNG).
Why does LNG play such a crucial role? Read on for the full explanation in this article.
What Is Carbon Neutral?
Carbon neutral refers to a condition in which the total greenhouse gas emissions, primarily carbon dioxide expressed in CO₂ equivalent (CO₂e), generated by an entity are balanced through a combination of emission reductions and carbon absorption or compensation mechanisms, resulting in net-zero emissions.
This concept is commonly adopted as a sustainability target by companies, products, or countries. The scope of emissions covered may include direct emissions, energy-related emissions, and other indirect emissions, depending on the standards and commitments applied.
Read More: Can Bioenergy Replace Fossil Fuels?
What Is the Difference Between Carbon Neutral and Net Zero?
Carbon neutral and net zero emissions are often mistaken as identical goals, even though they differ fundamentally in concept, emission scope, and emission reduction approach.
Understanding these differences is essential for companies when developing effective decarbonization strategies.
Emissions Scope
In terms of emissions scope, carbon neutrality generally focuses on balancing greenhouse gas emissions. It typically includes direct emissions and energy-related emissions, and in some cases, value chain emissions, depending on the standards used.
Net zero, on the other hand, takes a more comprehensive approach by targeting all greenhouse gases across the entire value chain. It emphasizes deep emission reductions before neutralizing any remaining emissions that cannot be eliminated.
Emission Reduction Approach
The key distinction between carbon neutral and net zero lies in how emission reductions are achieved and the role of carbon offsets.
Carbon neutrality is relatively more flexible, as it allows emissions to be balanced through offsets without requiring very strict internal reduction measures.
By contrast, net zero adopts a much more rigorous approach, prioritizing internal emission reductions to very low levels. Offsets, particularly those based on carbon removal, are used only to neutralize truly unavoidable residual emissions.
What Does This Mean for Companies?
For companies, carbon neutrality is often seen as a more attainable short- to medium-term target to demonstrate commitment to climate action and serve as an initial step in emissions management.
Net zero, however, is a long-term strategic goal that requires deep emission reductions through business model transformation, investment in low-carbon technologies, and active engagement across the entire value chain.
Read More: Rising Carbon Footprints, LNG as a Potential Solution
How Can Carbon Neutrality Be Achieved?
Achieving carbon neutrality typically involves a combination of three main strategies:
Reducing Emissions from Energy Sources
Emission reductions from energy sources can be achieved through a combination of energy efficiency improvements and a shift to lower-emission energy sources.
Companies can enhance efficiency by adopting technologies and processes that require less energy to deliver the same output.
Additionally, switching fuels from coal to natural gas or renewable energy can significantly reduce emission intensity as part of the journey toward carbon neutrality.
Reducing Operational Emissions
Operational emission reductions involve various internal initiatives aimed at lowering energy consumption and direct emissions. These measures include:
- Conducting energy audits to identify major emission sources
- Optimizing industrial processes to reduce heat and fuel demand
- Gradual electrification of equipment and vehicle fleets
Offsetting Remaining Emissions
Residual emissions that are extremely difficult to eliminate with current technologies can be offset through carbon offset mechanisms, particularly for carbon-neutral claims and, to a limited extent, within net-zero frameworks.
Offsets are achieved by purchasing carbon credits from high-quality projects such as reforestation, sustainable forest management, or technology-based carbon removal initiatives.
The use of credible standards such as Verra (VCS) or Gold Standard is essential to ensure that the credits meet principles of additionality, measurability, and verification.
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What Is the Role of LNG in Achieving Carbon Neutrality?
Although LNG is not a standalone solution, it plays a critical role in accelerating progress toward carbon neutrality, particularly in industrial and energy sectors that still face challenges in fully transitioning to renewable energy.
LNG serves as an interim solution to reduce emission intensity in the short term while preparing for a longer-term transition to renewable energy systems.
Advantages of LNG in a Carbon Neutral Strategy
Compared to conventional fossil fuels, LNG offers several advantages:
- CO₂ emissions are 20–30% lower than oil and 40–50% lower than coal
- Rapid reductions in Scope 1 emissions (quick wins)
- Reliable energy supply to ensure operational continuity
For companies in the early stages of transition, replacing high-emission fuels with LNG represents a practical and realistic approach to achieving carbon neutrality targets in the short term.
Read More: Is Carbon Capture and Storage Just a Green Gimmick?
The Position of LNG in a Carbon Neutral Strategy
It is important to recognize that LNG is not the final solution on the path to net-zero emissions. Instead, LNG functions as a transition fuel (bridge fuel) that supports the shift from high-emission fossil fuels to an energy system dominated by renewables.
The role of LNG is most effective when combined with strong internal emission reduction efforts, such as improved energy efficiency, process electrification, and the deployment of low-carbon technologies.
Within this framework, carbon offsets should be limited to covering residual emissions that are not yet technically feasible to eliminate.
With this approach, the assertion that achieving carbon neutrality without LNG would be difficult for certain industrial sectors in the short term can be considered valid.
LNG provides a pragmatic bridge that enables companies to reduce emissions quickly while allowing time to develop the technologies, infrastructure, and renewable energy systems required to reach net-zero targets in the long term.
References:
- European Parliament. Accessed 2025. What is carbon neutrality and how can it be achieved by 2050?
- ASEAN. Accessed 2025. ASEAN Strategy for Carbon Neutrality
- Kementerian ESDM. Accessed 2025. Menteri ESDM: Implementasi Karbon Netral Harus Transparan dan Akuntabel
- Kementerian ESDM. Accessed 2025. COP ke-26, Menteri ESDM Sampaikan Komitmen Indonesia Capai Net Zero Emission
- IBM. Accessed 2025. What is carbon neutrality?
