On the potential for strategic behavior in jurisdictional REDD

Area of Science:

• Environmental Science
• Climate Change Mitigation
• Forestry Management

Background:

• Voluntary carbon markets are shifting from project-based to jurisdictional approaches for REDD+ credits due to credibility concerns.
• ART TREES has seen over $3 billion in committed credit purchases, highlighting the market's scale and need for reliable credit sources.

Purpose of the Study:

• To assess whether current jurisdictional REDD+ baseline methodologies incentivize strategic behavior that could compromise carbon credit additionality.
• To identify vulnerabilities in jurisdictional REDD+ approaches that could lead to the generation of non-additional credits.

Main Methods:

• Utilized global, remotely sensed forest change data for all eligible REDD+ jurisdictions.
• Analyzed existing jurisdictional baseline approaches to identify opportunities for strategic behavior and potential errors.
• Examined deforestation trends in relation to crediting periods and enrollment decisions.

Main Results:

• Jurisdictional approaches present opportunities for credit generation without new policy actions and discourage enrollment of high-deforestation areas.
• Two metrics predict over 30% of baseline errors; strategic enrollment could yield millions of non-additional credits.
• While systematic exploitation is not evident, nearly half of enrolled jurisdictions show increased deforestation before crediting, suggesting anticipatory clearing.

Conclusions:

• Jurisdictional REDD+ exhibits both positive governance outcomes and critical vulnerabilities that necessitate methodological reforms.
• Anticipatory deforestation by private landowners is a concern, indicating potential loopholes in current REDD+ frameworks.
• Reforms are crucial as jurisdictional REDD+ credits gain prominence in voluntary carbon markets to ensure environmental integrity.