Disclosed are apparatus and methods for compensating for the change in length of an encoder strip due to environmental effects such as temperature and humidity. The apparatus and methods utilize two simple optical sensors spaced apart and mounted on a substrate having a different coefficient of thermal expansion than the encoder strip; the substrate is mounted to the movable component which is to be positioned, such as a printer carriage. Embodiments of the methods utilize information from the two sensors, in conjunction with information from the analog encoder used to position movable component, to compensate for environmental effects.