Verra disputes Guardian findings on 'worthless' REDD credits
Quantum Commodity Intelligence - US-based standard Verra has strongly rebuffed findings by the Guardian newspaper that avoided deforestation (REDD) carbon credits are "largely worthless" because they are based on a scenario that overestimates carbon reductions.
The UK newspaper published Wednesday an article titled "Revealed: more than 90% of rainforest carbon offsets by biggest provider are worthless, analysis shows", which was inspired by academic papers published in 2020, 2022 and 2023.
The study finds that just eight out of 29 Verra-approved projects where analysis was possible showed evidence of reduced deforestation, using "synthetic controls" that compare regional deforestation to claimed project deforestation rates.
The Guardian, which worked on the project with German paper Die Zeit and SourceMaterial, also found that credits from 21 projects had no climate benefit, seven had between 98% and 52% fewer than claimed using Verra's system, and one had 80% more impact.
The left-leaning paper said its findings are "likely to pose serious questions for companies that are depending on offsets as part of their net zero strategies".
The heart of the debate is the so-called emissions baseline used by carbon projects to measure their impact, which is a counterfactual – ie, projects must cut carbon dioxide in addition to what normally would have occurred.
This scenario is, by definition, open to criticism.
Verra, which administers the world's largest registry for REDD+ projects, said the methodology used by the Guardian is unsuitable to assess individual projects.
"Although these studies provide data that is a useful contribution to the wider work on optimizing methodologies for forest carbon projects, they have limited utility for assessing the impact of REDD+ projects because they do not consider site-specific drivers of deforestation," says Verra.
"Specifically, they reach incorrect conclusions because they rely on synthetic controls that do not accurately represent the pre-project conditions in the project area, as the studies' authors themselves acknowledge."
"REDD+ projects are not randomly located; local factors that mean a particular area is at acute risk of deforestation are a major determinant for selecting project areas."
The US registry says it asks that developers update REDD project baselines every six years, instead of every 10 years previously, to take political changes and other recent drivers of deforestation into account.
Synthetic controls are used by Verra for certain types of projects, such as Improved Forest Management (IFM) in North America, but the registry says the approach is not suitable for REDD+ projects because of the difficulty in finding points that match inside and outside the project area at the start of the project.
Disingenuous
"All the studies found next-to-no or no deforestation within the REDD+ project areas looked at, which is a success: these projects have successfully stopped deforestation," says Ed Mitchard, a forest expert and co-founder of forest biomass analytics company Space Intelligence, who calls the Guardian article "disingenuous".
"The arguments are about how much deforestation would have happened without the projects: but in a world where we've repeatedly said we're going to stop tropical deforestation and failed to do so, these projects have taken private-sector money from the west and spent it in developing countries to conserve forests, normally with good community/development outcomes as well as carbon and biodiversity outcomes," Mitchard says.
"At minimum, these REDD+ projects, which are all located in areas that independent assessors agreed were at significant risk of deforestation or degradation at the time of project starting (or they would not have been validated and verified), have succeeded in doing better than the average hectare of tropical forest," he adds.
Last October, Verra published draft guidelines for REDD+ projects that seek to harmonise rules across methodologies and avoid cheating by developers.
The new guidelines include standardised procedures for activity data generation, baseline development, monitoring and leakage, which can greatly affect a carbon project's feasibility.
"I'm sure there are projects that have inflated their baselines a little. Predicting the future is hard, projects have choices, and they will choose the options that make their project more viable. This is why Verra is moving to remove choice with the Consolidated REDD+ Methodology," says Mitchard.
Nature-based prices appeared little affected by the latest Guardian article, with the December 2023 Nature-based Global Emissions Offset (N-GEO) futures contract trading at $4.40/tCO2e in the European afternoon, up from $4.35 on Tuesday.
The article is part of a long series of stories criticising the carbon offset market for claiming inflated carbon benefits or disenfranchising local populations.
