New research has found that only a small fraction of forest-based carbon credits purchased to offset greenhouse gas emissions actually contribute to preventing deforestation. A study examined nearly 20 UN-backed offset projects in central Africa, South America, and Southeast Asia and found that out of 89 million credits, only 5.4 million resulted in carbon reduction through forest preservation. This accounts for approximately six percent of the credits. Carbon credits represent one tonne of CO2 either removed from the atmosphere through tree growth or prevented from entering through avoided deforestation.
Burning fossil fuels and deforestation emit about 40 billion tonnes of CO2 annually, contributing to global warming. As pressure increases for corporations and countries to reduce emissions, the market for carbon credits has grown. In 2021 alone, over 150 million credits valued at $1.3 billion originated in the voluntary carbon market under the UN’s REDD+ system, which aims to reduce emissions from deforestation and forest degradation in developing countries.
However, carbon offset schemes have faced criticism for lack of transparency, questionable accounting practices, and conflicts of interest. Additionally, the recent increase in wildfires in regions with forests supporting carbon credit schemes has raised concerns about the permanence of these offsets under UN rules. Earlier this year, Zimbabwe announced that it would appropriate half of the revenue generated from offsets on its land, further exposing vulnerabilities in the forest-based offset market.
The findings of this study highlight the need for greater scrutiny and accountability in the carbon offset market. It suggests that many companies and governments may be purchasing credits that do not effectively contribute to reducing deforestation and greenhouse gas emissions. To address this issue, it is crucial to establish transparent and reliable verification systems for forest-based carbon credits, ensuring their integrity and effectiveness in combating climate change. Failure to do so could undermine the credibility and impact of carbon offset initiatives, hindering global efforts to mitigate climate change.
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