Yahoo Finance IETA responds to The Guardian's claims that carbon offsets are 'worthless'
The world cannot wait for “imagined states of perfection”, says the CEO of carbon credit verifier Verra.
The International Emissions Trading Association (IETA) has responded to a Jan 18 article by British daily The Guardian, which alleged that “more than 90%” of rainforest carbon offsets by Verra, the world’s biggest certifier, are “worthless”.
“The Guardian article… raises concerns with the methodologies used to calculate carbon dioxide reductions from a number of projects set up to cut emissions by avoiding deforestation and forest degradation (projects typically referred to as REDD+),” reads IETA’s statement, released on Feb 1.
REDD+ is one of the largest, and therefore most prominent, types of carbon reduction project, says IETA.
The Guardian’s investigation and article take issue with elements of the methodology and the calculations used to determine emissions reductions. The article cites academics that take issue with highly technical elements of the methodologies used to determine the amount of emissions reductions by projects to generate carbon credits.
IETA claims “many other experts support” these contested technical elements. “The article did not fairly represent the views of both sides,” adds the Geneva-headquartered non-profit organisation.
IETA is working in concert with Verra on multiple fronts, with both parties launching an organisation here in Singapore last year.
In December 2022, IETA partnered with the World Bank and the Singapore government to launch the Climate Action Data Trust (CAD Trust), a platform to share information about carbon credits and projects.
CAD Trust links, aggregates and harmonises all carbon credit data from multiple project registries to facilitate transparent reporting.
Major registries like Verra, Gold Standard, American Carbon Registry and Global Carbon Council plan to connect to CAD Trust in 1Q2023, with the first layer of data to be made publicly available at that point.
In response to The Edge Singapore’s queries at the launch of CAD Trust, Simon Henry, director of carbon market development at IETA, says Verra alone certifies some 80% of voluntary carbon credit trading activity worldwide. Together, the share of carbon activity represented on CAD Trust will rise above 90%, he adds.
The Guardian investigation
According to The Guardian, its nine-month investigation also involved the German weekly Die Zeit and SourceMaterial, a non-profit investigative journalism organisation.
The exposé’s main target is the Washington-based Verra, which operates a number of leading environmental standards for climate action and sustainable development, including its verified carbon standard (VCS) that has issued more than 1 billion carbon credits.
Verra’s rainforest protection programme makes up 40% of the credits it approves and was launched before the Paris agreement in 2015 with the aim of generating revenue for protecting ecosystems, reads The Guardian’s piece. “Gucci, Salesforce, BHP, Shell, easyJet, Leon and the band Pearl Jam were among dozens of companies and organisations that have bought rainforest offsets approved by Verra for environmental claims.”
To assess the credits, The Guardian says a team of journalists analysed the findings of three scientific studies that used satellite images to check the results of a number of forest offsetting projects — known as the REDD+ schemes.
“Only a handful of Verra’s rainforest projects showed evidence of deforestation reductions, according to two studies, with further analysis indicating that 94% of the credits had no benefit to the climate… The threat to forests had been overstated by about 400% on average for Verra projects, according to analysis of a 2022 University of Cambridge study,” says The Guardian.
Verra CEO responds
David Antonioli, CEO of Verra, responded on Jan 23, slamming the “sensationalist articles” for containing “outlandish claims”. “These are academically interesting exercises, but they would never pass muster as bona fide carbon crediting methodologies.”
According to his LinkedIn page, Antonioli became principal CEO of Verra in October 2008, a year after its founding by “environmental and business leaders”.
He continues in his statement: “Not all scientists agree, of course, but we do strongly believe that one-sided reporting, with an exclusive focus on a few cherry-picked studies, does not do justice to the realities on the ground and the wide range of opinions on this topic
The debate over REDD is “complicated”, says Antonioli. “Certifying REDD activities is not easy, in part because one has to quantify the risk of forest loss that would occur without the carbon project (i.e., the baseline). In other words, this requires counterfactual analysis, which is a fancy term for looking at a situation and asking what would happen if things were different.”
He adds: “This approach isn’t unique to REDD and is a cornerstone of the impact analyses that government agencies, academics and others around the world use to determine what works, what doesn’t, and how to allocate resources. Counterfactual analysis is, by its nature, impossible to confirm with 100% certainty, but is critical if we are to channel more resources to protecting forests as a critical means of fighting climate change.”
REDD is the abbreviation for “reducing emissions from deforestation and forest degradation”, followed by REDD+, with the “plus” referring to “the role of conservation, sustainable management of forests and enhancement of forest carbon stocks in developing countries”.
Constant improvement is vital for the developing scheme, says Antonioli. According to him, ongoing efforts to update REDD+ include shortening baseline periods to six years, so deforestation estimates are more accurate.
Other updates include allocating robust jurisdictional baselines, consolidating methodologies and digitalising measurement, reporting and verification (DMRV).
Antonioli writes: “REDD projects are not some abstract concept on a piece of paper; they represent real projects on the ground that deliver life-affirming benefits to communities and individuals in the form of agricultural training, education and healthcare — while at the same time protecting forest carbon stocks and preserving critical biodiversity and water resources, to name a few additional benefits.”
‘Imagined states of perfection’
The methodologies that govern carbon reduction calculations are constantly being reviewed, reads IETA’s statement. “International bodies like the Integrity Council for the Voluntary Carbon Market and the Voluntary Carbon Markets Integrity initiative are tasked with further improving the quality and integrity not just of carbon credits, but in the way they are marketed and used.”
Citing rapid climate change, IETA echoes Antonioli’s statement. “We don’t have the time to wait for all the different new and emerging technologies to be economically scalable — we have to do as much as we can, as soon as we can.”
Verra has issued over 1 billion carbon credits, says Antonioli, which have “channelled billions of dollars into climate action and helped forest communities thrive”. “There is simply no other approach if we are going to channel much-needed finance to protect forests under threat.”
He adds: “Instead of waiting for imagined states of perfection, we have chosen to move forward with supporting forest protection projects around the world using these methods, which are constantly under review and continuous improvement. The urgency of the climate and biodiversity crises is too great to ignore this vital tool.”
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