Peer-reviewed study concludes that 94% of deforestation credits claimed by the largest offset provider are worthless. (Vyacheslav Argenberg CC BY 4.0 via Wikimedia Commons)
by Chris Lang
Editor, REDD-Monitor
In January 2023, The Guardian, Die Zeit, and SourceMaterial published the results of a nine month investigation into forest carbon offsets. They found massive overestimates of the number of carbon offsets generated from the projects.
The research focused on Verra, the world’s largest carbon standard, and found that “94% of the credits had no benefit to the climate.”
The investigation used the analysis in a preprint paper that had not yet been peer reviewed. The paper has now been peer reviewed and published in the journal Science.
The authors looked at 26 REDD projects in six countries on three continents and found that “most projects have not significantly reduced deforestation.” Some of the projects did reduce deforestation, but “reductions were substantially lower than claimed.”
Keerti Gopal, a journalist with Inside Climate News sums up the findings of the Science paper:
“Only 18 of the 26 projects had sufficient publicly available information to determine the number of offsets they were projected to produce. From project implementation until 2020, those 18 projects were expected to generate up to 89 million carbon offsets to be sold in the global carbon market. But researchers estimate that only 5.4 million of the 89 million, or 6.1 percent, would be associated with actual carbon emission reductions.”
Counterfactual baselines
The problem is the counterfactual baseline, which is a story made up about what would have happened in the absence of a particular REDD project. It’s impossible to check whether the story is accurate or not, because the project did go ahead.
Even REDD proponents agree that this is the case. Everland is a company created by Wildlife Works Carbon, a REDD project developer, to market REDD credits. Obviously, Everland claims that REDD is effective. But Everland also acknowledges that, “fundamentally it is impossible to ‘validate’ a counterfactual simply because by definition it is what did not happen.”
In other words, Everland admits that Verra has been creating carbon offsets out of hot air since it was set up in 2007.
Writing in 2016, Larry Lohmann, who writes about climate justice at The Corner House, highlighted the problem with baselines Lohmann emphasized that this is not a problem with particular REDD projects, but with REDD and all other offsets:
“So when academic and policy authors say that this or that REDD project is bogus or a fraud because it is non-additional, they are talking nonsense. No REDD project could ever be either additional OR non-additional. To put it yet another way, the problem is not ‘bad baselines’ but the concept of counterfactual baselines itself. That reality does more than invalidate any particular REDD project. It invalidates REDD (and all other offsets) as a whole.”
Predictably enough, Verra disagrees with the claims of worthless carbon offsets made by The Guardian, Die Zeit, and SourceMaterial. But not long after the investigations were published, David Antonioli announced that he would be resigning from his US$345,272-a-year job as CEO of Verra.
Prices and sales of REDD carbon offsets have crashed this year. A recent report from Barclays found that the price of carbon offsets has fallen to about US$2, down from about US$9 at the start of 2022. According to Barclays, the overall value of the voluntary carbon market this year is US$500 million, down from US$2 billion in 2021.
The Guardian reported on the Science paper under the headline “Carbon credit speculators could lose billions as offsets deemed ‘worthless’.”
Naomi Klein commented that, “Speculators may lose billions but the rest of us have lost decades to these predictably scam-laden ‘market’ ‘solutions’.”
Human rights and REDD
But it’s not only dodgy baselines, phony carbon offsets, and hot air that bedevil REDD projects. There are also reports of human rights abuses in REDD projects.
In 2017, the Centre for International Forestry Research put out a paper looking at allegations of human rights abuse in relation to REDD. The paper found “multiple allegations of abuses of the rights of Indigenous Peoples in the context of Reducing Emissions from Deforestation and forest Degradation (REDD+) readiness and implementation.”
CIFOR’s paper also noted that, “grassroots and international movements (and related media like REDD-Monitor) have successfully publicized claims of rights abuses, likely preventing others.”
In June 2023, Verra stopped the issuance of carbon credits from the Southern Cardamom REDD project in Cambodia. The suspension followed a letter from Human Rights Watch about the brutal form of fortress conservation imposed by Wildlife Alliance, the project developer, on local communities living in the project area.
Trafigura Group is a multinational commodity trading company incorporated in Singapore. It’s the largest metal trader and the second largest oil trader in the world. It is also the world’s largest trader of carbon removal credits.
Bloomberg reports that Trafigura recently bought carbon credits from the Southern Cardamom REDD project. Trafigura had a contract to sell these to a large retailer.
As a result of the human rights allegations, Trafigura offered its client the option of buying credits from a different project. The client accepted, leaving Trafigura with the Southern Cardamon REDD credits stranded on its books.
Hannah Hauman has been Trafigura’s global head of carbon trading since April 2021. Before that, she was an oil trader, working for Shell, Puma Energy and other oil companies. She joined Trafigura in 2019 as a crude oil trader. She told Patrick Greenfield of The Guardian that, “coming from oil trading, it is strange to see units in carbon markets become invalid overnight. But I think it is in their nature to be constantly evolving with science. It is inherent in the asset class.”
But carbon offsets are not “constantly evolving with science.” They don’t become “invalid overnight.” All carbon offsets are always invalid. Always have been and always will be. It’s time to scrap this dangerous false solution.
Reposted, with permission, from REDD-Monitor, August 25, 2023