Carbon credits have become a popular tool for companies, governments and individuals looking to reduce their carbon footprint. Carbon credits span a number of different sectors, ranging from Nature-based Solutions (NbS), Renewable Energy, Community Programs and Waste to Energy. Within these categories there are usually two distinct types of carbon credits: removals credits and avoidance credits. Oko focuses on NBS project development. One type of NBS carbon credit is forestry-based removals credits, which involves removing carbon from the atmosphere by planting trees and other vegetation. Another type is avoidance credits, which involve avoiding emissions that would otherwise occur. While both types of carbon credits are valuable, Oko has chosen to focus on reforestation to create removals carbon credits and here’s why:
Forestry-based removals carbon credits are generated by reforestation or afforestation projects that sequester carbon from the atmosphere. Reforestation projects involve planting trees in areas that were previously deforested or degraded, which helps to restore the local ecosystem, promote biodiversity, and provide a habitat for wildlife. Afforestation projects grow new forests on empty areas of land where previously there had been no forests. As trees grow, they absorb carbon dioxide from the atmosphere, storing it in their biomass and in the soil. The carbon credits generated by these projects are based on the amount of carbon that is removed from the atmosphere over a specified period of time.
Avoidance carbon credits, on the other hand, are generated by projects that avoid emissions that would otherwise occur. One example of an avoidance project is REDD+, which stands for Reducing Emissions from Deforestation and Forest Degradation. REDD+ projects involve protecting forests that are at risk of being cleared or degraded, thereby preventing the release of carbon that would have occurred if the forests had been destroyed. The carbon credits generated by REDD+ projects are based on the amount of emissions that are avoided over a specified period of time.
Both forestry-based removals and avoidance carbon credits are valuable tools for mitigating the effects of climate change. However, Oko has chosen to focus on reforestation to create removals carbon credits for several reasons.
Firstly, reforestation is a proactive approach to addressing climate change. By planting trees and creating and restoring new, indigenous forests, we are actively removing carbon from the atmosphere and promoting the restoration of ecosystems. This helps to mitigate the effects of climate change and promote sustainable development.
Secondly, reforestation projects have a wide range of co-benefits beyond carbon sequestration. By creating and restoring new forests,we are promoting biodiversity, providing a habitat for wildlife, and helping to restore degraded ecosystems. Additionally, reforestation projects can provide economic benefits to local communities, such as jobs and income from sustainable forestry practices.
Finally, Oko believes that reforestation is a more transparent and measurable way to generate carbon credits. The carbon removals generated by reforestation projects are relatively easy to quantify, as they are based on the growth and sequestration of trees over time. In contrast,avoidance credits are often more difficult to measure and verify, as they require assumptions about what would have happened in the absence of the project.
But in the world of carbon credits, avoidance credits generated through REDD+ projects have been the industry norm for quite sometime, most likely due to the fact that they have the potential to generate a significant number of carbon credits very quickly, providing a relatively immediate economic incentive for both investors and project developers alike. Removals credits, on the other hand, take years to generate because re-growing a forest takes time and expertise.
Diving deeper into the world of REDD+, the avoidance project methodology has recently come under global scrutiny. So, what’s the issue?
One of the main criticisms of REDD+ carbon credits is that they do not address the root causes of deforestation. Instead of addressing the underlying drivers of deforestation, such as illegal logging, land grabbing, or unsustainable agricultural practices, REDD+ focuses on the preservation of forests as carbon sinks. While this may help to reduce emissions in the short term, it does not address the underlying causes of deforestation, and may even create perverse incentives that encourage deforestation in other areas.
Another criticism of REDD+ is that it may not be effective in reducing emissions. There is evidence to suggest that REDD+ projects may be vulnerable to fraud and double-counting, which could lead to overestimation of the amount of carbon being sequestered. Additionally, there are concerns that REDD+ projects may not be durable, as the forests may be at risk of being cleared or degraded in the future.
A third criticism of REDD+ is that it may have negative impacts on local communities. There are concerns that REDD+ projects may displace indigenous peoples and local communities from their land, and that the financial incentives provided by the program may not be sufficient to compensate for the loss of livelihoods and cultural heritage. Additionally,there are concerns that REDD+ may promote a one-size-fits-all approach to forest management that does not take into account the needs and perspectives of local communities.
In recent years, there have been several high-profile cases of fraud and corruption in REDD+ projects, which have contributed to the negative scrutiny of the program. In 2020, the World Bank cancelled a $15 million REDD+ project in the Democratic Republic of Congo after it was found to have falsified data on deforestation rates. Similarly, in 2019, the Amazon Fund, which supported REDD+ projects in Brazil, was suspended after President Bolsonaro’s administration cut funding and undermined the program.
In conclusion, both forestry-based removals and avoidance carbon credits are valuable tools for mitigating the effects of climate change.In the case of REDD+ avoidance projects, however, while they have the potential to be an effective tool for mitigating climate change and when implemented correctly can be an incredibly impactful carbon emission mitigation tool, it is clear that the program needs to address some key issues in order to be truly effective and to re-gain the trust and support of stakeholders. Oko has chosen to focus on reforestation to create removals carbon credits for its proactive approach, wide range of co-benefits, and transparent and measurable methodology. By investing in reforestation projects, we are working to create a healthier planet for ourselves and future generations.