A recent investigation into Verra, the world's leading carbon credit provider, revealed that over 90% of their rainforest offsets are likely "phantom credits" and do not represent real carbon reductions. What should we think about the Guardian's recent allegations against Verra? Here are 5 key questions.
What is the background of this investigation against Verra?
The nine-month investigation was conducted by the Guardian, the German weekly Die Zeit and SourceMaterial, a non-profit investigative journalism organization.
According to the various studies cited in the survey, the credits Verra verifies are "largely worthless" and are "phantom credits." In detail:
- Only a handful of Verra's rainforest projects showed evidence of reduced deforestation, with further analysis indicating that 94% of credits had no climate benefit.
- The threat to forests had been overestimated by around 400% on average for Verra projects, according to analysis of a 2022 study by Cambridge University.
- Gucci, Salesforce, BHP, Shell, easyJet, Leon, and the Pearl Jam Group were among dozens of companies and organizations that purchased Verra-approved rainforest offsets for environmental claims.
What does Verra say?
In a response, Verra explains that it is "disappointed to see the publication of an article [...] falsely claiming that REDD+ projects consistently and substantially over-issuing carbon credits." In particular, the carbon credit provider explains that these studies reach "erroneous" conclusions because they rely on "synthetic controls" that do not accurately represent pre-project conditions in the project area. The agency notes that "synthetic controls are used effectively by Verra for certain types of projects, such as forest management improvements in North America. However, this approach is not suitable for REDD+ projects due to the difficulty of finding points that match inside and outside the project area at the start of the project."
Should we be surprised by these attacks on carbon credits?
Not really. Accusations of misuse of carbon credits, particularly in projects to stop deforestation, are not as recent as this article and the accompanying buzz would have you believe. Since their inception in 2003 and their creation in 2005, REDD+ projects have been criticized. And, year after year, the criticisms have grown stronger(REDD+: A Scheme Rotten at the Core - World Rainforest Movement, The 'virtual economy' of REDD+ projects: does private certification of REDD+ projects ensure their environmental integrity?, Offsetting CO2 emissions may not be a silver bullet...).
In 2016, Laura Brimont, former coordinator at IDDRI used the example of two REDD+ projects in Madagascar and DRC to explain why these two projects should not have been certified:
- "The certifiers' business model is based on the number of credits certified. It is therefore in their interest not to be too restrictive with project developers, so as not to lose future customers.
- Second, in contexts of political instability and fragile states, as in the case of Madagascar and the DRC, accurately predicting something as complex as deforestation is a task we know is nearly impossible."
So is the carbon credit system to be banned?
For some, everything is to be thrown away in the carbon credit system. Because, not being perfect, the system would leave too much room for abuse.
But the subject is complex and that is why we took the time to write these lines. First of all, we must remember that these systems are virtual. They are based on a reference, a calculation method and a result in agreement with these two elements. What happens if there is a disagreement on the reference or on the calculation method? A disagreement. That's what the Guardian article is about.
Secondly, we must also understand that this carbon credit system is still very limited. It has the merit of existing, but it is fundamentally flawed. As Laura Brimont explained in 2016: "an alternative would be to broaden the definition of performance to include indicators other than carbon credits, which would reflect, in particular, the efforts made by forest countries to reduce the drivers of deforestation (securing land tenure, investing in agricultural transitions that consume less land, improving control of protected areas, etc.)."
In addition to being incomplete, the system is often perceived as incomprehensible or opaque. In France, EcoTree reminds us that "nothing is more vague than a carbon credit from a forestry project. The sequestration of CO2 takes place over decades, throughout the growth of a tree, not at the date of purchase of the credit. Moreover, there is never a guarantee that the stored carbon will remain in place (i.e., in the tree) long enough for the acquired carbon credit to be efficient, as forests are never immune to the vagaries of weather (fires, high winds...) disease or deforestation due to human activity."
Should we stop fighting deforestation and stop our commitment to reforestation?
Of course not. This Guardian article is yet another reminder of the importance of transparency and accountability in the carbon offset market. Treewashing exists and must be fought. Is it normal, for example, that a hectare of non-diversified forest has the same weight in this system as a hectare of diversified forest? The use of carbon contribution to mitigate climate change is a tool, but it must be done in a verifiable, reliable and ultimately effective way. This is why carbon contribution projects must be strongly supervised and used only as a last resort, when no other solution can reduce or eliminate the CO2 emissions of a human activity. The participation of companies in the global carbon contribution is necessary to support projects with a strong social and environmental impact that would not otherwisebe possible... and that will incidentally capture carbon from the atmosphere.
With regard to the carbon credit system, many remind us that we should not necessarily throw everything away at once. The issue is rather to know how to best use this system. Gregoire Guirauden, co-founder of Riverse, a carbon measurement, verification and monetization platform, explains it very well: "The question is not whether carbon credits are good or bad, carbon credits are a tool. It's like saying blockchain is good or bad, insurance good or bad, internet good or bad. There are good and bad uses for each of these tools. Carbon credit is a way for decarbonation projects to find the financing they need, provided VOLUNTARILY by companies that have already started their own reduction trajectory, as French law now implies."
Indeed, reforestation projects are an important tool in the fight against climate change, but it's clear that they must be implemented in a way that truly benefits the environment, its biodiversity and local communities. As players in this chain, we need to hold companies to account for their environmental claims, and demand transparency and accountability in the carbon contribution market. We must also ensure that reforestation projects are implemented in a way that is fair to local communities. Only then can we really have a positive impact on the environment and the fight against climate change.
In conclusion, two reminders:
- There has to be consultation: One of the perverse effects of "greenwashing" is to render any action dubious, open to question. Every piece of research provides solutions and additions. It's up to all of us - technology players, researchers, members of civil society and politicians - to know how to take things apart and move forward together towards a common goal.
- There should be no doubt: The best ton of carbon is the one that is not emitted. It doesn't matter what carbon credit system is used, what reference frame is used or what calculation method is used. Planting trees is never a license to pollute.
