BBC Panorama documentary: “A lot of these offsets that have been sold on the voluntary carbon market are essentially worthless”

A recent Panorama documentary exposes the systemic problems with REDD.

A recent BBC Panorama documentary investigates carbon credits from REDD projects. The documentary team travels to the Kasigau REDD project in Kenya, the Seima REDD project and the Southern Cardamom REDD project in Cambodia.

This post focusses on the systemic problems in the REDD carbon credits industry that the Panorama documentary raises through interviews with academics, a journalist, and industry insiders. In future posts, REDD-Monitor will look at the REDD projects in the documentary.

Dr Friederike Otto, Imperial College London

Panorama speaks to Dr Friederike Otto, Senior Lecturer in climate science, Imperial College London. She points out the fundamental problem underlying all carbon credits:

“Companies want us to buy their stuff and for us to think that therefore we somehow are contributing to solve the climate crisis. Sorry but that’s just bullshit.”

She comments on the heatwave that hit the UK in 2022, when temperatures reached a new record of 40.3°C. 2022 was the hottest year on record. 2023 was even hotter.

“We would never have reached 40°C in the UK without climate change. We will see more and more heat waves like this, and they will get hotter and hotter the more fossil fuels we burn.

“This is only going to get worse. And of course heat waves are not the only dangerous extreme weather events. A warmer atmosphere can hold more water vapour. That comes out as heavy rainfall.

“Our societies are built on hundreds of years of very stable weather and now we’ve shifted the weather very quickly to be quite different. So this is not a problem of the future. This is happening already, here and now.

Jonny Mulligan

Jonny Mulligan previously worked as an environmental adviser to the oil industry. He now works for a company called Martello that provides advice to companies about meeting climate legislation.

Mulligan notes that after the Paris Agreement companies started to look at ways of reducing their emissions. “Companies hit this realisation that it’s really tough, it’s very hard,” he says. “That’s when suddenly you saw kind of a boom in carbon credits.”

“Things had been been brewing I think in carbon markets really from about 2021, and maybe we haven’t really wanted to face up to it, that inconvenient truth that we can’t just go out and buy these things called carbon credits and hope that we can fix the problem.”

Mulligan says that,

There’s a lot of good people who for the most part are trying to do the right thing, but companies and brands don’t tend to do stuff that isn’t going to give a return. Companies definitely realise by appearing greener, you appeal to a certain demographic, a certain audience, and you can sell more products.

Later on in the documentary, Mulligan says that,

“There’s no regulation of carbon credits. There is no global government or a local government who’s setting the rules. People don’t want rules and regulation, and in the vacuum of no regulation you’re reliant on the institutions to do the right thing.”

That’s where carbon certification companies come in. Verra is by far the largest of these. In recent years, Verra has faced serious criticism and in May 2023, the organisation’s CEO, David Antonioli, resigned from his US$428,965-a-year job.

Assistant Professor Thales West, Vrije Universiteit Amsterdam

Thales West is an Assistant Professor at the Vrije Universiteit Amsterdam. He is the lead author of a 2023 paper that examined 26 Verra-certified REDD projects and found that “most projects have not significantly reduced deforestation” and for projects that did reduce deforestation, “reductions were substantially lower than claimed”.

West previously worked for Rainforest Alliance as an auditor of REDD projects.

“Back in the day I was really convinced that what was being done was essentially the best that could be done and I had faith in the system. I was also at the same time falling in love with the idea of doing research, science etc., to look at these projects and to evaluate them. Are they really achieving what they claim to be?”

West talks about his 2023 paper:

“We did find some evidence that some projects were reducing deforestation. It’s just that they were not reducing as much deforestation as they claimed, and that’s also a problem because the more deforestation you avoid the more offsets you can sell.”

West says,

“It’s a waste of money and we’re also to some extent fooling ourselves we think we’re doing something good. We are not and we are not investing in something that can have an actual impact when it comes to mitigating climate change.”

Professor Julia Jones, Bangor University

Panorama also spoke to Julia Jones who is a professor in Conservation Science at Bangor University. She is a co-author of a 2022 paper that looked at whether REDD projects actually reduce deforestation. She talks about the findings of that paper:

“We found these kind of forest conservation projects have on average slowed deforestation. However, and this is the big but, there are a substantial number of projects that are operating in places with really quite a low background rate of deforestation so perhaps it’s not really surprising that there wasn’t a lot of deforestation to avoid and therefore they haven’t effectively slowed deforestation because there just wasn’t much deforestation going on in the area where they were occurring anyway.”

Jones notes the problems of counterfactual baselines:

“It’s a real challenge to be able to work out how much deforestation would have happened in the absence of a project. It’s a genuine intellectual challenge. So when you buy a carbon credit you believe that one metric ton of carbon has not been emitted that would have otherwise been emitted through deforestation had you not bought that carbon credit. And that’s actually remarkably difficult to demonstrate.”

And Jones says that,

“I think it really reveals something important which is that a lot of these offsets that have been sold on the voluntary carbon market are essentially worthless.”

Patrick Greenfield, The Guardian

Patrick Greenfield is a journalist at The Guardian. For nine months, he worked on an investigation with journalists from Die Zeit and SourceMaterial into REDD projects certified by the Washington DC-based carbon certification company Verra.

“I wanted an answer to what the hell a carbon neutral burger was, for example, or a carbon neutral flight, or a carbon neutral whatever,” Greenfield tells Panorama.

“What we were trying to do was very simply compare what real companies were using for real claims with the findings of these studies.

“We very neatly ended up with a table showing over 90% of these credits were hot air, nothing, total mirage. To begin with I didn’t really believe it to be honest. That meant that many of these carbon neutrality claims were just nonsense.”

The Panorama documentary acknowledges that, “The carbon credit industry now points to another study that rebuts the earlier research. It challenges the calculations used and says there are major flaws. This new paper has been submitted for peer review.”

Toby Janson-Smith, Verra

Toby Janson-Smith is Chief Innovation Officer at Verra. He’s worked at Verra for more than 10 years. Before that, he spent eight years at Conservation International. In 2022, he earned US$320,744.

Janson-Smith tells us that,

“Verra sets standards that allows carbon projects to quantify the climate benefits that they deliver and then to generate carbon credits that can be sold into the carbon market to generate funding to support those projects.”

Verra earns most of its money from a commission on carbon credits. More credits means more money for Verra - and more money for project developers. Asked about this blatant conflict of interest, Janson-Smith replies,

“There’s no incentive for us to generate additional revenue or to make any profits because that doesn’t happen. We’re a non-profit and the money just goes back into managing the programmes to make sure they’re being run in the most efficient and effective way.”

Panorama points out that Verra is a non-profit organisation, but it generates a lot of money. Verra holds reserves of US$52 million. Verra’s top management earn extremely comfortable salaries.

Manuel Estrada, independent climate change consultant

Manuel Estrada has worked in the carbon credit industry since the 1990s.

“At that time it was exciting. It was the future, you know. I was proud of myself, you know. I was thinking yeah, you know, when I have kids I will be so proud saying, ‘Well you know I changed the world.’ Now, 20 years later, it’s like, ‘No really, no.’ It’s like, ‘Sorry kids. I tried my best.’”

In March 2020, Estrada was hired by Verra to look at how developers were calculating the number of carbon credits generated by their projects.

“It could happen that just by switching methodologies the same project with the same activities and the same results would have a different volume of credits. So it was something, it was weird.”

He tells Panorama that some of the developers’ calculations weren’t credible. His team started to work on a more reliable method.

“The idea of this methodology was that it would change everything. That was the idea, but projects may see their potential revenues decrease more than half. We’re talking about investments that may be in the millions of dollars.”

Estrada says that some project developers were pushing back hard against his proposals.

“And I was there, you know. And I can tell you, you can feel that pressure. You had project developers that were like, ‘No we don’t like these changes. Why are you doing this?’ So it was a difficult moment. Because you have a system where everyone benefits, you know, from not being too robust. . . .

“Verra benefits because Verra receives money for each credit that has been issued. Plus you have these relationships with project developers that have grown for the last decade or so. So if this system is working for them then don’t touch it. Why would you change the rules if everyone’s happy?”

---