But Market Forces!!! As Emptiness Of Most Carbon Offset Programs Becomes Clear, Global Carbon Prices In Freefall

[hatrack]

EDIT

Just two years ago, the survival of these trees – a crucial elephant habitat – was the basis of a multibillion dollar carbon boom that touched almost every large-scale forest on Earth, underpinning the environmental claims of some of the biggest companies in the world. Netflix and Shell were among the companies that bought millions of credits from Kasigau. The market reached more than $2bn (£1.5bn), propelled by a wave of enthusiasm for offsets as a solution to global heating and biodiversity loss. Each credit represented a tonne of CO2 that was not released into the atmosphere from deforestation, theoretically cancelling out emissions from flying, fashion, food and fossil fuels. During the pandemic, leading investment banks formed trading desks for offsets as prices surged from a few dollars to more than $30 a credit for some schemes.

But today, a large part of the money and enthusiasm for these schemes has dried up after a dramatic market collapse. Crucial flaws in the way credits were calculated indicated that the overwhelming majority of forest protection credits approved by Verra, the world’s leading certifier, massively overstated their impact.

In 2023, a joint Guardian investigation found that, based on analysis of a significant percentage of the projects, more than 90% of offsets did not represent genuine carbon reductions, according to independent research published by journals including Science, PNAS and Conservation Biology. Another paper, published in Science last month, reinforced the finding that there were deep flaws in the Verra system, and another is expected in the coming months. The Washington-based NGO says two of the previous studies have been “discredited” and declined to comment on the latest Science study. Fragility in the market compounded after the re-election of Donald Trump, as banks and big businesses began rolling back their green commitments.

The market downturn wiped hundreds of millions off the market – and along with it, the funding for a number of projects that actually were successfully slowing deforestation – including the handful that were stopping large amounts of forest loss. “The rumour in the community is that the project is dying because there is no money coming in,” says Agnes Kipee, 60, who lives in a village inside the Kasigau project boundaries. “Before, we were getting a lot of stipends from the carbon project. Right now, nothing is coming. We wonder what is happening,” she says.

EDIT

https://www.theguardian.com/environment/2025/nov/06/carbon-offsetting-market-collapses-what-happens-to-the-forests-they-hoped-to-protect-aoe

[FadedMullet]

1. It's four in the morning and I'm pretty tired, too tired to think this one through. Is this a good thing or a bad thing?

[hatrack]

2. It's not good . . .

Shorter version:

1. Carbon offsets have been hyped to an absurd degree.
2. Turns out most of them are full of double-counting, fake accounting and BS.
3. Some, however, have been highly effective.
4. However, since the whole machine runs on a market price for carbon emissions, the collapse of that price is taking the whole thing down, including the small number of effective projects.
5. What could have been an effective approach - with honest oversight - just got the boot.

[FadedMullet]

3. Mr. Hatrack, thenk you for the very helpful, and concise, interpreptation, albeit disheartening as usual.