By Terrence McCoy, Júlia Ledur and Marina Dias | July 24, 2024 at 6:00 p.m.
A six-month investigation reveals that many carbon credit ventures reap profits from public lands they have no right to and fail to share revenue with those protecting the forest.
Much of the Brazilian Amazon rainforest is safeguarded behind a green shield of publicly protected land. In recent years, companies have launched preservation projects in search of a lucrative commodity known as carbon credits. But a Washington Post investigation found that most of the projects — which have generated tens of millions of dollars — overlapped with public lands.
When added together, the ventures claimed enough public land to cover the state of Maryland — six times.
PORTEL, Brazil — Over the past two decades, a new financial commodity known as carbon credits has become one of the world’s most important tools in the fight against climate change. Companies and organizations seeking to offset their emission of carbon have spent billions of dollars on them.
The Amazon rainforest, because of its size and global environmental importance, has increasingly drawn those pursuing carbon credits. Here, these people are called “carbon cowboys.”
They’ve launched preservation projects across the region, generating carbon credits worth hundreds of millions of dollars. Those credits, in turn, have been purchased by some of the world’s largest corporations. The projects have helped transform the Brazilian Amazon into an epicenter of a largely unaccountable global industry with sales, according to market research, of nearly $11 billion.
But a six-month Washington Post investigation shows that many of the private ventures have repeatedly and, authorities say, illegally laid claim to publicly protected lands, generating enormous profits from territory they have no legal right to and then failing to share the revenue with those who protected or lived on the land. The use of such lands to sell credits also contributes little to reducing carbon emissions.
The frequency with which these projects make use of public property, the amount of land involved and the value of the credits generated have not been previously reported.
The Post found that more than half of all carbon credit forest preservation projects in the Brazilian Amazon overlapped with public territories. The amount of public land claimed by these private ventures was more than 78,000 square miles, six times the size of Maryland. The businesses that purchased the carbon credits from the private land ventures to offset emissions included major international companies: Netflix, Air France, Delta Air Lines, Salesforce, PricewaterhouseCoopers, Airbnb, Takeda Pharmaceutical Co., Boston Consulting Group, Spotify, Boeing.
The Post’s investigation is based on a review of thousands of pages of corporate and court records, interviews with dozens of people across the forest, and a geospatial analysis of carbon credit projects in the Amazon. In performing the geospatial analysis — the most extensive to date — The Post compared the boundaries of 101 private preservation projects submitted to the two international certifiers, Verra and Cercarbono, that operate at the center of the global carbon credit marketplace, with government maps of publicly protected areas in the Amazon. (Four ventures were eliminated from the analysis because their map files malfunctioned.)
A majority of the projects are still in line to be certified. But 35 have been certified. And among those, most — 29 — overlapped with public lands. The ventures have so far generated more than 80 million carbon credits, at least 30 million of which have been sold.
It’s unclear how much was made on the initial sales, since detailed transaction information is not publicly available. But their estimated value at the time that purchasers used them to offset emissions was more than $212 million, according to an analysis based on annual market rates.
The Post analysis found no evidence that the purchasers acted improperly. Nine companies identified in this article responded to a request for comment, saying they seek to ensure the carbon credits they purchase are of high quality or that they were reducing their use of credits.
In a country without any laws regulating the trade in carbon credits, the private ventures routinely proceed without government review. The Post could identify only two projects that had received government authorization. Asked for comment, several project owners disputed the accuracy of government maps used in The Post’s analysis.
Brazilian authorities are starting to investigate. Three projects were targeted last month by federal police, who issued five arrest warrants and alleged that nearly two dozen companies had conspired to improperly net nearly $35 million in carbon credit sales.
In this opaque global market, some projects earn carbon credits by increasing the use of renewable energies. Others recycle waste or plant trees or improve agricultural practices. But in the Brazilian Amazon, the approach that has been most popular — and profitable — is known as “avoided deforestation” ventures. These projects win credits by essentially maintaining the status quo — by preserving forests seen to be at risk.
The Post’s investigation not only exposes failings in the global system for vetting such ventures but also calls into question the value of some projects in addressing global warming. Much of the Brazilian Amazon is safeguarded by a green shield of publicly protected lands: national forests, Indigenous territory, federal and state reserves. But when polluting companies buy credits generated by supposedly preserving land that was already protected, their money contributes next to nothing.
“The system is very gameable,” said Joseph Romm, a climate researcher at the University of Pennsylvania. “And the victim is the planet, and all of humanity who suffers because we’re not reducing emissions, but get to pretend we are.”
Spanning the Amazon
One of the biggest actors in the Amazon’s carbon credit rush is American businessman Michael Greene, a brash Midwesterner given to bold proclamations. “I’m the biggest carbon credit [preservation] project developer in Latin America,” he boasted in a 2022 letter to officials in one Amazon city. “I’m so big that my business is 50 percent of Brazil’s carbon credit market.” On LinkedIn, his company, Agfor, has described itself as the world’s “largest” forest preservation carbon credit developer.
The Post identified 19 projects overseen by Greene and his companies. They all overlapped with public lands either partially or completely, according to The Post’s geospatial analysis. Ten have been certified, winning 45 million carbon credits. The projects have spanned the Amazon, but several have been centered in the impoverished river town of Portel. (Click here for the entire article.)
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