Climate impact of carbon credits is substantially overestimated

14.11.2024 – 11:00 Öko-Institut e.

V. Press Release Berlin, 14 November 2024 Climate impact of carbon credits is substantially overestimated In a systematic assessment of more than 60 empirical studies, a new meta-study concludes that the actual emission reductions of the mitigation projects analysed are, on average, about six times lower than claimed. The study “Systematic assessment of the achieved emission reductions of carbon crediting projects,” which was published today in the journal Nature Communications and in which Dr Lambert Schneider of Oeko-Institut was involved, reveals major shortcomings in the quality of carbon credits.



Limited climate impact of carbon credits The mitigation projects analysed account for around a fifth of the credit volume issued to date – equivalent to almost one billion tonnes of CO2 emissions. All project types, such as the avoidance of deforestation and the use of efficient cookstoves, have systemic quality problems. For some projects, such as improved forest management, no statistically significant emission reductions could be proven at all.

Cookstove projects – in which conventional cookers are replaced by more fuel-efficient ones – only achieved around 11% of the emission reductions for which carbon credits were issued. In the case of the destruction of the potent greenhouse gas SF6, the actual emission reductions amounted to only 16 percent of the claimed emission reductions. Market reform urgently needed "This study shows that there are systemic problems in quantifying emission reductions.

In addition, some projects are not dependent on the revenue from the sale of carbon credits, but are implemented anyway," says Lambert Schneider, Research Coordinator for International Climate Policy at Oeko-Institut and co-author of the study. “The methodological approaches and rules of carbon crediting mechanisms urgently need to be improved.” There are many reasons for the overestimation of emission reductions.

"The rules of the carbon crediting programmes often give project developers too much flexibility. This can lead to unrealistic assumptions being made or inaccurate data being used, resulting in an overestimation of reductions," says Lambert Schneider. In projects destroying the waste gases hydrofluorocarbon (HFC)−23 and sulphur hexafluoride (SF6) in industry, the data shows that waste gas generation increased when plant operators were able to generate carbon credits.

The carbon crediting programmes have a particular responsibility to improve the quality of the carbon credits. They should improve their approaches to assessing projects and calculating emission reductions. It is crucial that more conservative assumptions are made and that data based on the latest scientific evidence is used.

Analyses by the Carbon Credit Quality Initiative confirm results Various initiatives are striving to improve the integrity of carbon credits associated with mitigation projects. Along with the Environmental Defense Fund (EDF) and World Wildlife Fund for Nature (WWF-US), Oeko-Institut founded the Carbon Credit Quality Initiative (CCQI) . The CCQI independently assesses the quality risks of various types of carbon credits.

“The CCQI’s analyses confirm that the project types examined in the study have high integrity risks,” adds Lambert Schneider. Meta-study in Nature Communications ‘Systematic assessment of the achieved emission reductions of carbon crediting projects’ Contact at Oeko-Institut Dr Lambert Schneider Research Coordinator for International Climate Policy Energy & Climate Division Oeko-Institut, Berlin office Phone: +49 30 405085-304 Email: l.schneider@oeko.

de Oeko-Institut is a leading independent European research and consultancy institute working for a sustainable future. Founded in 1977, the institute develops principles and strategies for ways in which the vision of sustainable development can be realised globally, nationally and locally. It has offices in three cities in Germany: Freiburg, Darmstadt and Berlin.

oeko.de | blog | X | mastodon | instagram | magazine.