REDD+ and Climate Finance: Are we paying to save forests, or just offsetting guilt?

Image - Willian Reis

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Every year, governments and companies pour millions upon millions into ‘offsetting’ their carbon emissions, with many now holding a global influence. One of the largest global carbon trading mechanisms, created by the United Nations in 2007, is something called ‘Reducing Emissions from Deforestation and Forest Degradation’ (REDD+). The concept, in theory, is fairly simple. Individuals, companies or any entity emitting carbon invests in a REDD+ project in the Global South that aims to keep forests standing and slowly reverse the growing global deforestation rates. However, in reality, REDD+ reveals the messy politics of climate finance and the impact this has upon the global political economy.

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While some argue that funding projects in countries such as Peru, Brazil or the Congo Basin in return for ‘carbon neutrality’ is a win-win situation, critics argue that REDD+ is more about finance than equity, a reinforcement of capitalism without consequence.

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As companies largely based in developed nations continue to emit tC02e at alarming rates, reports from both Mongabay and the Guardian suggest that between 90 to 95 percent of the carbon credits claimed through REDD+ projects do not actually represent real reductions. Therefore, companies are gaining a competitive market advantage through their ‘green’ operations while they actually continue to emit the same levels of C02, and these projects allowing them to become ‘green’ do not actually hold any real value.

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While the real value of emissions reductions created through REDD+ projects is continuously up for debate, what is less debatable is the power structures of these projects. The overwhelming reliance on private finance to uphold REDD+ projects has created an imbalance in the overall ambitions of such projects, seeking capitalistic gains over sustainable development. There are cases such as Alto Mayo in Peru where indigenous people, whose cultures are enshrined into these forests, have been forcibly removed from their homes for these projects to be expanded, thus prioritising capitalistic gains over societal preservation.

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Despite these flaws, the UN remain committed to REDD+ and the broader global carbon market through article 5 of the Paris Climate Agreement. Many projects are beginning to include provisional safeguards on Indigenous rights, education and consent between communities and project developers. With the expectation being that carbon markets will continue expanding, and with trillions needed for climate action, it is impossible to ignore private finance. So, is REDD+ a climate lifeline, or just another form of greenwashing? This is not simply a question of tropical forests, but whether the mechanism of climate finance is durable and fixable.