New study deems carbon credit 'worthless', raises concerns about their effectiveness in forest preservation
New scientific evidence shows many carbon offsets have no environmental worth, have become stranded assets and that some offsetting could make global heating worse
Millions of carbon credits are being generated by significantly overestimating the levels of deforestation they prevent, according to a study published in the journal Science.
This means that many of the "carbon credits" bought by companies to balance out emissions are not tied to real-world forest preservation as claimed.
Carbon credits, also known as carbon offsets, are permits that allow the owner to emit a certain amount of carbon dioxide or other greenhouse gases.
An international team of scientists and economists led by the University of Cambridge in the UK and Vrije Universiteit Amsterdam in the Netherlands found that millions of carbon credits are based on crude calculations that inflate the conservation successes of voluntary REDD+ projects.
Consequently, many tons of greenhouse gas emissions considered "offset" by trees that would not otherwise exist have, in fact, only added to our planetary carbon debt, the researchers said.
REDD+ schemes generate carbon credits by investing in the protection of sections of the world's most important forests -- from the Congo to the Amazon basin. These credits represent the carbon that will no longer be released through deforestation.
Organisations and individuals can then offset their own carbon footprint by purchasing credits equivalent to a given quantity of emissions.
Carbon credit markets have exploded in recent years. Over 150 million credits originated from voluntary REDD+ projects in 2021, with a value of U.S. USD 1.3 billion. Some companies use carbon offsetting to claim progress towards "net zero" while doing little to reduce greenhouse gases, the researchers said.
The study authors argue that the booming trade in carbon credits may already be a type of "lemons market": where buyers have no way of distinguishing quality, so some sellers flood the market with bad products, leading to a breakdown of trust and ultimately market collapse.
"Carbon credits provide major polluters with some semblance of climate credentials. Yet we can see that claims of saving vast swathes of forest from the chainsaw to balance emissions are overblown," said study senior author Professor Andreas Kontoleon, from Cambridge's Department of Land Economy.
"These carbon credits are essentially predicting whether someone will chop down a tree, and selling that prediction. If you exaggerate or get it wrong, intentionally or not, you are selling hot air," Kontoleon said.