Timber companies apply for carbon credits for trees they don’t cut down

As it systematically clears the oldest trees from this stunning wilderness, Madras seems an unlikely seller of carbon credits, a financial instrument that theoretically allows consumers and businesses to offset air travel , ride-hailing apps, fashion shopping and other pollution-generating activities.

The company doesn’t earn points by planting trees to absorb carbon dioxide. The compensation it sells for is based on one assumption: an estimate of the number of existing trees it prevents from being cut down.

There is logic to this. Madras believes that unlike illegal loggers and homesteaders in neighboring countries, the country engages in selective, sustainable logging on its 1,000 square miles of timber concessions to maintain the ecological balance of its forests.

But the approach, known as Reducing Emissions from Deforestation and Degradation (REDD+), raises questions about how to protect the world’s forests, which sequester billions of tonnes of carbon, as well as the booming market for carbon credits. As the window to avoid catastrophic climate change closes, scientists are beginning to question the complex methods used to calculate the profitable counterfactual of avoiding deforestation.

Some warn this could actually accelerate the climate crisis, as consumers, instead of reducing emissions, buy credits that fail to deliver on their green promises.

The stark contrast between Madras’ lush concession and the barren land surrounding it made the benefits of compensation obvious. The forest is surrounded by dusty fields that have been cleared by unregulated forest clearers in their chaotic campaign to colonize this remote area.

Home furnishing brands such as Shell, Southwest Airlines, Disney and Gucci have all used points generated in this way.

Southwest stressed that it offers optional points to passengers but is not using them as part of a net-zero strategy. Shell declined to comment. Disney and Gucci did not respond to requests for comment.

REDD+ accounts for nearly a third of the voluntary carbon market and was worth $2 billion in 2021, but is expected to reach $40 billion annually by 2030, according to S&P Global Commodity Insights.

But Britaldo Soares, a professor at the Federal University of Minas Gerais in Brazil and the developer of the software used in Madras, calls REDD+ a climate scam.

It’s a logging concession, he said. He said he developed the Dinamica EGO program to measure the impact of government policies, not to calculate credits. He said it was the equivalent of using a crystal ball to predict the future.

REDD+ projects around the world are generating virtual credits, said Barbara Haya, director of the carbon trading program at the University of California, Berkeley.

The reason, she says, is simple: Everyone at the table benefits from more points. No matter which direction you turn, there is an excess of trust. Its systematic.

By “everyone,” she means the project developer, the certification company that sets the rules, and the third-party auditors who determine whether the project prevents forest loss.

She stressed that the latter two have an incentive to approve projects because rejecting them could prevent others from contracting for their services.

With some projects generating millions of credits, each representing a ton of carbon, trading for about $1.40, and sometimes more, the temptation to exaggerate avoided emissions is strong.

Verra is a non-profit organization that holds 70% of the global carbon verification market and has issued 1.23 billion credits to date. But it’s not just for authentication. The group also receives 20 cents for each point sold. Haya called it a conflict of interest.

There are questions surrounding the baseline, the projection that deforestation would occur without carbon emissions concessions. These are calculated in a variety of ways, including projections of historical forest loss and comparisons with other parts of the forest.

Maybe they’re deliberately exaggerated, said Erin Hills, an environmental economist at North Carolina State University. But it could also be because project developers are trying to predict the future. That is impossible.

Then there is additionality, which is that in order to avoid emissions, the revenue generated from carbon credits must determine whether a forest is saved or destroyed.

Additionality is difficult to calculate because most carbon projects are built on land’s original uses: sustainable logging like Madras, ecotourism, Brazil nut gathering, and even protected areas where mining is prohibited. Many will already have protective measures in place, such as security or perimeter fencing.

Sears is one of eight researchers studying dozens of forest carbon concessions in Africa, Asia and Latin America. In a paper published last year in the journal Science, they found that most countries had reduced deforestation far less than claimed.

They concluded that of the 89 million carbon credits generated by these projects, only 5.4 million actually reduced emissions.

By the end of 2021, Maderacre had generated nearly 9.7 million points for buyers including Scotiabank and the gas-guzzling Dhaka Rally. The researchers said they found no evidence that the effort had the deforestation effects claimed. (Scotiabank declined to comment; Dhaka Rally did not respond to a request for comment.)

This analysis was supported by Suarez.since it is already a [timber] He said they had concessions, they had an obligation to protect it, there was nothing extra at all.

Maderacre manager Nelson Kroll disagrees. He said wood is wood, not oil or gold. Businesses based solely on logging cannot afford all the costs required to protect forests.

Vera acknowledged that calculating avoided emissions is complex and incomplete, but questioned the researchers’ conclusions. The group stressed that voluntary carbon markets were created by the private sector, driven by consumer demand, and were intended to fill the void left by governments’ failure to set mandatory offset standards in U.N. climate negotiations.

Villa spokesman Joel Finkelstein said the best is yet to come, but the products do make a difference. The organization continually updates its methods, sometimes in response to harsh criticism from academics and environmentalists.

The science of 15 years ago was very different from the science of today, Finkelstein said. At every point, we strive to achieve the best standards.

In the Madras Concession, red and blue macaws circle and sing overhead, and capuchin monkeys frolic in the canopy. Jaguar populations are so dense that the San Diego Zoo Wildlife Alliance has launched a research program on this top predator.

But in neighboring lands, Cebu’s cattle dot the brown fields of low-quality pasture. Teak plantations not native to the Amazon were smaller and in many cases failed and abandoned, ruining the landscape. Pillars of smoke on the horizon.

Ecocide is driven by transoceanic highways. Completed in 2011, the 1,600-mile road was designed to connect Brazilian goods to Peruvian Pacific ports to feed China’s insatiable economic needs.

There is very little freight traffic on the roads now. Former Peruvian President Alejandro Toledo, who co-built the highway with Brazilian President Luiz Incio Lula da Silva, is currently in pretrial detention, accused of accepting $25 million bribe in exchange for a contract to build the highway.

However, the road did pave the way for the destruction of this corner of the Amazon. Madrak at least prevented deforestation from overwhelming its concessions.

Kroll, a forestry engineer who once worked as an Amazon park guard, said deforestation is real and someone has to do the work.

He emphasized that Madracre harvests one tree per hectare every 30 years and only harvests shihuahaco trunks with a diameter of more than 75 centimeters, a stricter standard than the legal minimum diameter of 51 centimeters.

This is not a timber concession. It’s a concession to nature, Kroll said. Until we find ways to make forests economically competitive, they will continue to be destroyed.

Hills believes sweeping changes are needed.

We rely on these offsets to reduce our footprint, but the result is an increase in net emissions, she said. The climate is the real loser.

Reporting for this report was supported by a travel grant from the Pulitzer Center on Crisis Reporting.