The report develops an assessment framework that policy makers can use to determine whether offsets can add value while ensuring the environmental integrity of a compliance system. It uses an assessment framework for these factors to: (1) identify sectors that warrant offsets as cost-containment measures for ambitious climate targets due to emissions that are difficult to reduce; and (2) identify which emissions reductions would otherwise be unachievable, promote sustainable development, and the extent to which they enable transformative sectoral actions that may be considered to provide offsets. This evaluation framework is exemplified in various sectors and technologies.